A major insurance company says it loses $25 million from its bottom line for each one percent drop in its customer retention rate. What’s more, many formerly mutual (policyholder-owned)-turned-stockholder-owned companies are under increased pressure to keep earnings healthy. Add to that a customer base only a mouse-click away from competing insurers, and a picture emerges of an industry where enterprises are trying harder than ever to keep and obtain customers.
Enter integration, an increasingly important player in managing relationships between insurers and their policyholders. And in that sense, insurance might be viewed as a microcosm of what’s happening throughout the business world.
During the expoQ webinar Integration Improves Relationship Management in the Insurance Industry, Software AG Senior Vice President Bill Ruh and the company’s Financial Services Practice Director, John Stone, took a close look at how integration is helping insurance companies retain customers. The webinar is part of the Integrating Customer Touch-Points for Improved CRM series, sponsored by Software AG.
Paper bills and claim forms remain the most frequent types of communication between insurance companies and policyholders, so it’s no wonder opening up more channels to and from customers is paramount. Especially electronic channels, far less costly than paper ones.
Ruh noted that insurers can also use integration software to generate new revenue streams by flagging up-sell and cross-sell opportunities, and he pointed to integration as a ticket to trimming operational costs.
Still, insurers face challenges companies in other industries might not, making effective insurance CRM all the more daunting: Agents, frequently the middlemen between insurers and customers, must be kept in the loop. Insurance is a complex product “with a terminology and that doesn’t lend itself to e-business in the same way as buying a CD or book,” Stone said. And insurance can be hard to sell: “People will respond to a call from an insurance agent, but will not beat a path to their door,” Stone observed.
But Ruh stressed that carriers, agents and customers alike can be empowered by the integration of disparate content and data. And he detailed the architectural components of a system to accomplish that.