Insurers that develop new digital customer journeys for life insurance find themselves balancing a whole set of moving parts. Very often, these rest on assumptions around our customers’ preferences. Do customers first want information about our products, or do they want to go straight to prices? How long are they willing to spend in our online journeys? How many underwriting questions would be too much – or too few?
Fundamentally, this often depends on how “ready” a customer is to take out a policy. After all, if our customers know the type of policy they want and the exact amount of coverage desired, then a 5 minute digital journey is appropriate. But what if they don’t even know how life insurance works, and whether they need it?
We wanted to find out what our customers’ “big question” was when they arrive on our websites. To answer this, my colleague William Trump and I ran a quick pulse check with an online panel of 200 UK adults.
The big question
So what’s the first question that needs answering? Turns out – it’s not price!
We quickly realised that insurers assume consumers know more about life insurance than they actually do. First, we asked individuals without life insurance to tell us in their own words what their biggest question is when it comes to this purchase. Responses we received include “How does it work?”, “Is it to pay for a funeral?”, “How much is a payout?”, and “What is the process?”. Clearly, consumers have big questions about life insurance before even thinking about price.
We then asked the same individuals to pick a category that their question would fall into — 25% of respondents said that their question focused on whether they need life insurance, and 24% wanted to know how life insurance works. Put these two together and that’s roughly half of respondents asking fundamental questions about the “basics” of life insurance!
Even those who already own a life insurance policy gave similar feedback. When we asked what their biggest question was before buying their policy – 23% of respondents said that they wanted to know how life insurance worked, and 42% wanted to know how much cover they needed.
These insights tell us that most customers don’t have a clear understanding of how life insurance works. And that’s okay – it’s our job, as insurers, to help customers understand what life insurance is, what it does, and the value in owning a policy. It seems that we need to prioritize answering questions like these rather than purely focusing on monthly premium in our digital journeys.
Is journey length as important as we think it is?
In short: no.
When we asked individuals without life insurance how long they would be willing to speak to a financial advisor either over the phone or through a live chat, the typical answer was… 30minutes. Only 21% of individuals said it would need to be done in less than 10 minutes. In contrast, almost a third are willing to spend up to an hour. With 8 out of 10 respondents saying they are willing to spend more than 10 minutes working this out, this should make us stop and think.
Maybe we don’t necessarily have to put all our energy in developing online journeys that can be completed in minutes. Sure, timeliness is an attractive benefit but can we be sure that we’re answering all the questions that our customers might have? Life insurance is a big purchase and for the most part it is something that is purchased only once. Our results tell us that individuals recognise that this is an important decision. Three quarters of individuals without life insurance said that they’d be happy to spend a decent amount of time using an online needs assessment tool if it means that they’d get a personalised recommendation about what type of coverage they’d need. This is in contrast to only a quarter who said that they’d want to buy life insurance in as few steps as possible.
So, do individuals want a helping hand?
The overwhelming response is yes!
When we asked individuals without life insurance if they would know how much coverage they’d need, 71% said that they would need help to work it out, compared to 29% that said they could do this on their own. We asked this same question to individuals with life insurance, 51% said that they received help from either an advisor or an online tool in working out their coverage. More specifically, younger adults aged between 25 and 34 years received help. Younger adults are likely to be less familiar with life insurance, and so help is particularly sought after by this segment.
Finally, we asked individuals if they’d be interested in getting the same personalised advice that they’d expect from chatting to an insurance broker but through an app. Turns out people really like this concept, whether it be for advice in general or simply to get reassurance about what they’re buying. 6 out of 10 people who currently don’t have life insurance said that they’d be really interested in using this type of tool to find out if they needed life insurance. What’s more, 7 out of 10 customers with life insurance said that they’d like to use such a tool to see if they have the right level of coverage in place.
That’s why iptiQ is partnering with Anorak. Their regulated needs analysis tool provides personalised needs-based advice that individuals can access online and from the comfort of their home. Based on their recommendation, customers can choose to buy a policy there and then. Easy, stress-free and convenient.
What are our takeaways?
In a nutshell, individuals both with and without life insurance policies have big questions that they want answering. It’s crucial to include a helping hand in our journeys – even if they are moving online.
Interested in partnering with us? At iptiQ we’re on mission to protect people and their families with easy and engaging insurance. We view the customer experience as a vital element of this. If you do too, then get in touch and let’s work on something together.