The impact of loyalty on insurance
Vikki Jefferies is proposition director at PRIMIS and Personal Touch Financial Services
Loyalty is a term we use to describe your feelings for our favourite football team, our friends, or a particular brand. Many people also stay loyal to their bank and other financial services providers.
But in an increasingly competitive environment, with a huge array of providers and products available to clients, what role does loyalty play in today’s insurance market for brokers and consumers?
A client’s sense of loyalty
For clients, loyalty to a particular provider is often driven by inertia, apathy or a lack of understanding of the range of insurance products available.
Research from Which? indicated that 70% of insurance customers had been with the same provider for longer than a year. As a result, some consumers may have seen their policy renewal price rise over time. Other clients whose requirements have changed in those 12 months could also find that their insurance does not necessarily match their new circumstances.
Regulation introduced in 2015 has made some headway in encouraging homeowners to consider shopping around for their insurance needs. This legislation mandated insurers to proactively tell buyers at the renewal stage what their premium was the year before.
However, it is still the case that many consumers do not reassess their insurance requirements regularly enough.
This is where a broker can play a valuable role – taking care of the cover needs of their clients and highlighting bespoke solutions for home, motor, contents and other policies, as well as highlighting any potential cost savings.
For brokers, loyalty with clients is created by building the relationship, understanding their needs and proactively highlighting products and services to fit their lifestyle and requirements.
By speaking to their clients regularly (and not just at renewal season) brokers can build up a better picture of how their needs may change over time. They may be moving to a new house, have had a child or be doing an extension that requires extra insurance.
Brokers can advise on the best solution for all of these circumstances. After all, every client is different – and what they needed last year can be very different from what they need today.
It is vitally important that all clients are made aware of the importance of insurance cover, as well as the various benefits and options available in the market.
At PRIMIS and Personal Touch Financial Services, we realise that no two clients are the same and our panel of providers has been selected to provide coverage across the market.
We also have a range of tools and content to help reinforce the benefits of getting the right cover, whether it be buildings, contents or a property portfolio.
These tools allow the broker to quickly and easily compare household insurance products and premiums from a panel of providers, cementing that loyalty and helping clients feel at ease with their insurance provisions.