Customer loyalty in insurance market with respect to product and services has improved, said a study by market research firm IMRB International. In its annual syndicated study 'Insurance India', it said that life insurance sector has constantly evolved in the last few years owing to regulatory changes, emerging players, product innovation and improved distribution network.
The pan India customer loyalty study in the life insurance sector said that these improvements have in turn has created customer driven reforms impacting the customer experience at multiple levels.
The study said that customer driven reforms and guidelines set by the insurance regulator (Insurance Regulatory and Development Authority of India), including key turnaround time (TAT) are working in the favor of the customers. It added that customer perceptions on TATs with respect to issue of policy, acknowledging and resolving grievances have improved significantly.
According to the study, customers are also happier on other services like timeliness of the alerts/ reminders for premium due dates, timeliness of receiving the premium receipts for payments made and other related aspects. Improvements in the area of products and services have contributed to securing higher customer loyalty levels for many players over the last year.
However, agency is a channel where more focus may be required. Findings show that compared to other channels like Bancassurance (insurance companies using bank sales channels), customers who bought through agents have weaker perceptions and experiences about the companies.
Praveen Nijhara, VP, CSMM, IMRB International said, "IRDAI regulations have had a significant impact on the way insurance players have ramped up their products and services. More and more companies are looking at better customer engagement and ways to increase customer loyalty. At a macro level this year there has been significant growth of Truly Loyal customers as per the Loyalty Matrix, which should be good news for the entire industry."
Here, Truly Loyal are those customers who are loyal towards your brand and certain to buy more. The 2015 Insurance India report shows that close to 60 per cent of the customers are Truly Loyal to their insurance providers, which is significantly better than 2014. The proportion of High Risk customers (those who are unlikely to continue with / choose their existing life insurance providers the next time) have halved over the last two years.
However, there are still 26 per cent of the customers, who mention that they are unlikely to choose the same insurance provider next time. It was found that amongst the new customers who bought from agent, have given lower ratings on 'Ease of using the website for transacting'.
New customer loyalty highest when purchased online followed by agent and bancassurance.The study also showed that awareness of the 'online' payment option has increased significantly over last year and number of customers using the 'online' channel to make payments has also shown sharp growth.