Rethinking consumerism in insurance business

Almost all insurance practitioners talked to, on why insurance penetration in Nigeria has remained low have said and re-echoed that it was lack of awareness on the part of the insuring public. While a new school of thought, which perhaps could be more correct have said it is due lack of communication and in most cases communication in technical terms.

Whichever is more correct, the average consumer believes he has not been adequately cared for by his provider (insurer), not necessarily when claims arise but in between the contract period.

Analysts believe that more need to be done to win the interests of consumers and retain their patronage in the insurance contract.   

Here comes the experience of insurance consumer who thinks there is a huge big communication gap in the insurance contract.

At first, he was being persistently pursued. Eventually he paid attention, the marketer sounding strange, began to make meaning midway because he was just marketed about insurance for the first time and alas he was talked into appreciating insurance.

At a second meeting he parted with money as premium for a life insurance cover, having been promised that should anything happen to him, his dependants would be taken care of by the insurance company.

With this, the consumer sleeps and wakes assured that his family will have a cushion should the worst happen. The consumer paid this premium consistently for four years, during which period the agent was coming for his money and phoning in regularly to greet and enquire about his client’s family. But incidentally he changes job.

The fifth year came without any staff of the company or replacement of the agent asking for the usual premium. The sixth year came, it was the same thing and the insured who was newly converted did not either understand the implication of the premium not paid regularly, or where to go and pay the premium.

If eventually the policy matures, may be as a result of death of the policy holder, what will be the fate of the insured’s dependants? Why wouldn’t the insurance companies find a way to relate more closely with their customers? Is it not proper that the insurers find ways to monitor their customers profile and notify each customer particularly when their policy is due and requires renewal?

Unlike in insurance, the banks through alerts or customer service unit, call to inform their customer that a particular account with the bank is going dormant, not funded and all that. This is where customer service in insurance is weak.

Customer service according to experts is the provision of service to customers before, during and after a purchase.  It is also described as a series of activities designed to enhance the level of customer satisfaction – that is, the feeling that a product or service has met the customer expectation.

The essence of insurance is to meet the consumers’ expectation in terms of claims payment when it arises, but the consumer will lose confidence in the relationship should his policy elapse not out of his own volition, but as a result of the ineptitude of the insurance company. So, customers expect the insurance companies to live up to their promise by ensuring that the supposed ignorant customer is not left in the dark in terms of correspondence and relationship management.

The importance of customer relationship in establishing a good business transaction between the insurance industry and the insuring public cannot be taken for granted in the effort to bring about a positive image and increase insurance penetration in Nigeria.

A positive report by one consumer about insurance is capable of converting another ten people into taking insurance, just as a bad report about insurance is capable of discouraging more than 20 people from taking insurance.

Now is the time for the nation’s insurance industry to redefine its position and strategy to improve its’ relationship with the insured and the insuring public.

This has to start with the kind of people insurance companies would hand their identity cards and product pamphlets to sell to the public. These people must be trained and have requisite knowledge about insurance, as findings have shown that many of the insurance marketers ,including the agents are not knowledgeable enough and can hardly answer salient questions raised by potential customers.

The importance of customer service may vary by product or service, industry and customer. The perception of the success of such interactions depended on employees who can adjust themselves to the personality of the guest.

From the point of view of an overall sales process engineering effort, customer service plays an important role in an organization’s ability to generate income and revenue.

From that perspective, customer service should be included in the overall approach to systematic improvement. A customer service experience can change the entire perception a customer about an organisation or industry.

An insurance company representative was asked the name of his managing director and the answer did not come. Then how do you convince the potential customer that understand the company whose product you are selling? How will he believe you and part with his money? How capable are you to assist him get out his claim in the company when you do not even know the name of the chief executive officer? This is where we are; what do you expect the potential client to do?

Also important for insurance companies to take seriously is the issue of agent marketing. Companies must ensure that they assign new agents to replace any one going, in order to ensure effective follow up on existing customers.

But where a company has deployed direct debit approach to collecting its premium from clients, they should as well monitor inflows on specific accounts to ensure that some accounts are no longer functional or funded by the customer. This will help revive such relationships or understand the client and help resolve any possible issue.

It is a fact that insurance companies are in business to make money, and so rely on technical mistakes of customers to reduce claims payments, but if the desire of the industry regulator, the National Insurance Commission (NAICOM) and the operators to increase market penetration and insurance density among the Nigerian people are anything to go by, then the attitude has to change.

Modestus  Anaesoronye