Coronavirus has changed everything. Fewer insurance conferences and shows, home-working as the default setting for many companies and much more use of technology to understand risk, develop new products, sell cover, update customer details and settle claims. Forrester has taken an in-depth look at the immediate impact and has a stack of idas regarding the way forward for the industry. It is well worth reading.
There will be a surge in claim activity — for example, UK insurer Aviva has already received £500,000 in travel insurance claims related to coronavirus from 500 customers — so how is the insurance industry gearing up to address this? We scanned the market and learned that insurers and their distribution networks are preparing by:
Making resources available and prominent. Smart carriers and their agent/broker partners have already stepped up with statements on what customers should do in the event of claims and how they’re ensuring the safety of their eld adjusters. Chubb not only has stepped up with a prominent COVID-19 statement on its home page; it has embedded a helpful link above the fold so that customers can see claim reporting options, including claim submission, tools, and claim resources including legal advice.
Small business blind spots.
A lot of US small business customers are going to be disappointed in their coverage — and their agents. From 2014 to 2018, small business owners who said they had business interruption coverage went from 19% to 28%. But these policies mostly exclude business interruption due to new and emerging diseases or only cover against direct physical loss like property damage, which is unlikely in the case of COVID-19. Call centres and agents will be tied up explaining coverage limits that should have been made obvious at the time of purchase.
Preparing for tough negotiations with their corporate clients.
In the case of insurance coverage T&Cs, the large print gives, the small print takes away. And the lawyers have beaten a lot of insurers to the punch. One attorney we talked to said that for even large business clients, “It doesn’t cost you anything to lodge a claim,” giving both parties the opportunity to negotiate grey areas. Insurers will need both analytics chops and diplomatic adjusters and customer service reps to triage the legitimate from at least the frivolous.
Limiting future exposure.
In order to protect existing customers and limit future losses and because COVID-19 is now a known event, many UK insurers have removed cancellation cover from any new travel insurance policies or won’t cover any claims related to COVID19. Admiral, Aviva, Churchill and Direct Line, and LV= have gone further to suspend sales of all new travel insurance policies.
From social distancing to toilet paper and pasta stockpiling, the psychological impact of COVID-19 is becoming clear. In times of uncertainty and risk, people want reassurance and are looking for help and guidance to adapt to and mitigate risk. However, many
insurers haven’t stepped up to this challenge, telling customers travelling overseas that their travel insurance policies are void or not offering enough information about coverage of COVID-19. Worse still, some insurers are capitalizing on consumer fears to push private health cover. This results in stress and anxiety, particularly for those who are financially vulnerable.
Now is the time for insurers to demonstrate their customer advocacy. It’s the right thing to do and will benefit companies further down the line. That’s because the perception on the part of the customer that a firm does what’s best for them, not just what’s best for the firm’s own bottom line is a key driver of loyalty and future purchase intent.
Insurers should communicate regularly, reassure consumers and stakeholders, and be proactive with their communities by:
Focusing on providing accurate and trusted guidance and help. In the US, CVS Health has sent an email to customers with links to stay informed about COVID-19; the healthcare company has opened crisis response lines for all Aetna and Caremark members who
may be experiencing anxiety related to COVID-19, provides video chats with health experts, and a 24/7 nurse medical line. A growing number of US health insurers including Aetna (CVS), Blue Cross and Blue Shield of Texas, and Oscar Insurance have also begun to waive cost-sharing for medically necessary testing of COVID-19.
Being transparent about coverage.
Consumers are confused and anxious because of the lack of clarity around policy coverage. Although claims due to epidemics are generally not covered, Allianz has demonstrated goodwill by accepting claims specific to COVID19 for emergency medical care and transportation, trip cancellation, or interruption while customers are on their trip. For those who for various reasons still need to travel overseas, Seven Corners in the US is providing up-to-date information on its website about policy coverage — for instance, medical expenses or emergency medical evacuation — specific to COVID-19, and its contact center responds to queries within 24 hours.
Proactively offering explicit coverage.
Consumers are anxious about what’s going to happen if they are infected by COVID-19. In
Singapore, NTUC Income, AIA Singapore, Manulife Singapore, and DBS Bank (in collaboration with Chubb Insurance) have announced free benefits for policyholders who are diagnosed with COVID-19. NTUC Income has rolled out COVID-19 benefits — on top of existing benefits — for various groups of policyholders. DBS Bank announced complimentary insurance coverage in relation to COVID-19 for all 5 million of its customers.
Now Is The Moment To Promote And Teach Customers To Use Your Digital Insurance Services
Throughout the decade after the introduction of the smartphone, insurers built assorted mobile apps, sites, and tools. But because engagement with insurers was often rare, customers didn’t download or learn to use them, instead preferring to both file and check claim status more often via human channels. For example, Forrester Analytics data shows that a negligible 3% of UK online adults and 4% of French online adults engage with their insurers through chatbots today. But in the new era of social distancing and call centre wait times wrought by COVID-19, now’s the time to showcase those investments; customers will be more likely or even have no alternative but
use them.
Now’s the time to show what the digital functionality does, not just what it is. Benjamin Franklin is purported to have said “Tell me and I forget, teach me and I may remember, involve me and I learn”. It’s too late to set up that “genius bar” that would have let consumers have some hands-on experience for moments like now. But you still can take a cue from MetLife’s MyDirect site and post demo videos that tout how easy the mobile site features are to use. Allstate and other insurers have plenty of YouTube videos that show off the DIY features of their photo claiming capabilities.
Enlist your human and IVR resources.
If you’ve not done so yet, change that hold time message to promote those digital services that save your customers time and let you focus on the harder stuff. Measure and incentivise your customer service reps who pitch these helpful digital tools, and if you’re looking for a way to keep underutilized field resources now working on a desk or at home, recruit some of them to act as virtual “genius,” setting up on-demand, how-to webinars, and “on call” times for live interactions.
Start or keep training your voice assistants. Insurers such as Lemonade and Zurich have invested in chatbots to handle claims. But those chatbots probably haven’t had much, if any, training for COVID-19 claims. Now’s the time to get your voice assistants on the front lines for at least listening to calls and developing skills, especially if COVID-19 outbreaks extend into the autumn or worsen.
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