Only 13% of consumers trust their current preferred insurance provider and only 8% have been loyal to their insurer for more than 3 years, according to new research from Ello Group.
The nationwide 1,000 consumer survey also revealed 42% are not loyal to their home, car or life/health insurance providers, just a 2% improvement on last year when 44% confirmed they weren’t loyal to their provider. This is despite new Financial Conduct Authority (FCA) regulation to protect loyal customers from paying more coming into play earlier this year.
In January of this year, the FCA introduced new rules to tackle price walking and the act of continuously increasing prices for loyal customers across the home and motor insurance sectors. However, the current economic crisis the UK is facing is making it increasingly more challenging for insurers to honour/reduce pricing on previous years.
The UK’s cost of living crisis is also leading to a rise in brand switching amongst consumers, with many expecting the brands they frequently purchase from to help alleviate this pressure. In fact, on being asked what would improve their trust in insurers, close to one in five (17%) said brands absorbing some of the increasing costs throughout supply chains, to help with the rising cost of living. While 16% said brands offering discounts at relevant places to help offset some of the rising cost of living and a further 14% said the brands they purchase from showcasing they listen/know their customers.
TRUST CAN BE EARNED, GOOD SERVICE MAKES A DIFFERENCE
Michael Kalli, managing director of Ello, commented: “It’s no secret the insurance sector has long struggled with customer retention and our last two pieces of research have solidified the fact the sector is amongst the worst performers on the customer loyalty front.
“While things are slowly but surely heading in the right direction, there’s more insurers could be doing to improve trust amongst their customers, in turn instilling loyalty and retention.”
On the key factors influencing a consumer’s decision to stick with an insurance provider long-term, the data revealed these are the top areas of importance:
- Price (38%)
- Good customer service (19%)
- Reliability (17%)
- Trust (17%)
- Quality of product service (16%)
For more insights, download Ello’s full ‘driving customer connections during challenging times’ report here: https://www.ellogroup.co.uk/driving-customer-connections-during-challenging-times
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