The one thing life insurers should be telling their customers right now
I’ve lost count of the number of companies that have got in touch with me with updates about the corona-virus. My magazine subscriptions, broadband provider, even my local brewery!
For the most part, these messages have been useful, as they provide a relevant update on what the company can – or can’t – offer me at this time.
But I haven’t yet heard from my life insurer (a point my colleague Roberto also makes here)
So why aren’t life insurers contacting their customers? One reason could be because they don’t feel there is any need to do so, or because they don’t know what to say.
For starters, I don’t think there is much point in life insurers simply repeating the information that is already in the public domain – for example around prevention measures, tips etc. There is a danger that this just creates information overload, and is not deemed relevant.
However, in my opinion there is something life insurers definitely should be doing.
And that is: reassuring their customers that they’re covered, even if the worst were to happen and the corona virus takes their life. Now I know that in some countries, epidemics are a standard exclusion on life insurance contracts – but in most countries they aren’t, meaning that a death claim due to corona-virus is as valid as any other.
You may think that telling people about this is unnecessary – and that no life insurance customer is in any doubt about whether they’re covered (this is exactly what one insurer said to me recently).
But it’s not what customers are telling us.
Over the past few weeks, we ran a couple of online surveys with around over a thousand members of the general population in the US and UK, two markets where epidemics are not a standard exclusion on life insurance contracts.
When asked if their life insurer would pay out if a policy-holder died of corona-virus, 45% of existing life insurance customer said “no” or “not sure”. In the US, this was 33%. This is a staggering number.
Some of the verbatim comments are quite scathing: “They will find an excuse not to. That the person didn’t take avoidable precautions”
Or this one: “Insurers do their best to not pay out. They will call this an Act of God.”
These comments are a sobering reminder that, despite all the good that life insurers do in people’s time of need, a strong perception of our industry remains one of distrust.
Given this “perception gap”, surely now is the time to reach out to our customers to reassure them about the coverage they have, and that we will pay out if the worst were to happen.
Here at iptiQ, we’re working with our partners to make sure customers are aware of the coverage they have in place. In some cases this has included sending proactive communication to customers, reassuring them that they are covered.
Many people have taken the right step to protect their families with their life insurance. We stand by them and will honour the trust they placed in us.