Consultancy: Reinsurance

Author: Krishane Patel | 29/05/2024

Background

The problem brief

The claims experience is a critical component of the insurance value proposition. It represents the moment of truth for policyholders—when the promise of financial protection is put into practice. For many customers, there is a perception that insurance companies are untrustworthy because they fail to pay out most of their claims.

This is a common misconception that insurance companies rarely pay out claims. In reality, most insurers pay over 90% of claims, according to the Financial Conduct Authority (2022). Despite this, the perception persists that insurance companies engage in profit-seeking behaviors at the expense of claimants, often fueled by anecdotal reports of denied claims. Even with high payout rates, many people still experience poor claims processes. Recognizing this issue, the client is keen on formulating a better claims journey for their customers, aiming to enhance the overall claims experience and rectify these negative perceptions.

Approach

Using behavioural science to diagnose, optimise and evaluate

This piece of research consisted of a behavioural diagnosis along with impact and evaluation of various treatments.

Behavioural diagnosis:

To understand the fundamental factors behind poor claims experience, multiple approaches were integrated, including customer journey mapping with a literature review , behavioural audit , qualitative interviews and survey research . These approaches were intergrated to ideate a unified set of drivers that led to poor claims experiences for customers.

Treatment ideation and evaluation:

Different solutions were generated based on the drivers identified in the behavioural diagnosis. These solutions were then evaluated using online experiments to understand their impact on customer experience.

Outcome

The experiments revealed how simple changes in the customer journey were able to improve the customer experience, increasing Net Promoter Scores by 8% .

Furthermore generated an additional 9% in repeat purchases. By adopting a more coherent view of customers, the client was able to extract a better understanding of their customers concerns and needs. This in turn translated to a better customer experience.

By adopting the insights generated from the behavioural diagnosis and the experiments the client was able to generate a more streamlined customer journey, removing friction and uncertainty as much as possible whilst managing expectations.