New Data Shows Life & Annuity Insurers Are Fumbling Digital Sales & Claims

What happens when you take dramatically changing customer expectations spurred by emerging Insurtech challengers, major factors reshaping the Life and Annuity (L&A) market, and add the impact of the coronavirus pandemic? You get a new mobile-first insurance customer that expects to open up a policy or file a claim with their carrier or broker quickly, digitally, and as seamlessly as when they’re purchasing their favorite products on Amazon. A life event is a Moment of Truth, both for prospects browsing an insurer’s site, or customers needing to complete a request for benefits or death notification form. Customers are often dealing with significant pain and anxiety and can be dealing with health and other complications when they turn to their insurer. That’s why the digital customer experience is so make or break for insurers: If it adds more pain and complexity to the customer, their trust and loyalty are lost for good and they’ll take their business to a competitor. Are insurer’s current L&A sales and claims passing or failing these moments of truth with their customers?

How Digital Are Life & Annuity Insurance Sales & Claims?

Lightico recently surveyed insurance professionals across the United States to assess first-hand how their company is currently managing new policy sales and existing customer claims processes.

Phone & Face-to-face Still Dominate L&A Sales

And while mobile experience has become table stakes for consumers, many carriers and brokers are still not equipped to provide it. Only 14% of new L&A insurance policies are completed via mobile, with only 14% more completed on the web. 35% of policy sales are still done in-person at the office, while 28% are handled over the phone with an agent. These numbers show that digitally closing L&A insurance sales still trails customer expectations significantly.

Failed Mobile Claims Processes End Up Clogging Call Centers

When it comes to existing customers, no scenario tests loyalty, longevity and likelihood to refer more than processing claims. Yet mobile adoption - or more to the point - effective solutions seem to be even more lacking here, with a mere 9% of customers submitting a claim on mobile. Claims are crucial moments of truth for customer relationships. It will be critical for L&A insurers to deliver digital and mobile solutions that assess customer claims accurately and resolve pay them quickly.

L&A Claims Are Full of Friction & Delays

Lack of completely digital and mobile CX leads to slower completion times and increased touchpoints. Over half of professionals indicated that it takes 2 weeks or more to process a customer’s claim.

Investment & Effort Wasted on Multiple Touchpoints Per Policy

3-4 touchpoints are still needed today to process a customer claim for the majority of insurance employees we surveyed, while another 20% shared that completing a claim takes them 5 days or more. Multiple touchpoints and slow completion times are directly the result of siloed digital solutions and paper-heavy legacy processes, which exhaust and frustrate both employees and customers. Despite insurance companies’ pouring in investment to digitally transform their back end core systems, their customer-facing experience is typically sewn together using several digital solutions that are not integrated resulting in high-effort, multi-step, customer interactions. Legacy processes - like email, PDF-based forms, printers, fax, and scanning machines - needlessly add more touchpoints for customers, who may start a process digitally, but are then bounced offline, forced to print out lengthy forms and use outdated machinery just to fax or scan forms and required documents back to their insurance company. The damage is felt on both sides, with higher call volumes inflating Average Handle Time (AHT) for agents, customer satisfaction and loyalty taking the fall due to sub-par CX.

The Time is Now to Accelerate Digital Complete L&A Insurance Journeys

65% of insurance professionals believe that cutting the time it takes to complete new policy sales and customer claims in half would significantly improve customer experience. Digital Completion is designed to eliminate the digital silos and legacy processes and replace lengthy and broken insurance journeys with one seamless digital session that guides customers from beginning to end, be it applying for a new L&A policy, or making a claim. Stay ahead of the digital curve - get the full survey report to find out more insights straight from insurance professionals to help future-proof your customer experiences.