CRM in Insurance: Capitalizing on the Customer Service Opportunity
For insurance companies today, focusing on the customer is more important than ever. Getting closer to customers and effectively responding to their needs is a great way to boost their loyalty and encourage deeper business relationships and additional spending—and it is also a much more strategic route to success than cutting costs and improving efficiency.
Insurance buyers have many more options for the ways in which they purchase insurance and interact with their insurance suppliers. They can work through agencies. They can work directly through insurance companies or brokers. They can purchase insurance through online sites or exchanges. And, no matter which approach is used, customers are now demanding multiple channels through which to interact with their providers—including face-to-face contact, phone, Web sites, e-mail, mobile devices, etc.
This new business climate has elevated the role of customer relationship management (CRM) technologies into a highly strategic position within the insurance industry. CRM technologies focus on managing all interactions that the organization has with its customers, maintaining contact information and customer status in order to leverage the data in a variety of business applications.
Clearly, vendors of CRM products are in a great position to capitalize on the customer service opportunity. Insurers know that if they can't get their customer service acts together, they'll lose customers to the competition.
And there's no shortage of CRM products to choose from. The problem is, the CRM market—just like the definition of the term "CRM"—is so broad that all sorts of different software products fall under its umbrella. For example, sales and field force automation, marketing analytics, e-mail response management, campaign management, personalization, and customer service are all legitimate application areas, and there are a variety of CRM products on the market that handle one or more of these functions.
Prioritizing Customer Service
Of these areas, customer service is the biggest priority for many insurance organizations. While many CRM technologies can handle a range of applications, including sales force automation and marketing analytics, those that handle customer service applications are worth special attention because they are at the center of the customer's interaction with the business.
Channels Are Expanding
Customer service is a tough area to tackle, especially as the channels of customer interaction have expanded from face-to-face or phone contact to include automated telephony systems, the Web, fax, e-mail, and even wireless devices and voice-over-IP. Consequently, many organizations are transforming their customer service centers from call centers into "virtual contact centers" that handle the myriad channels of contact in an integrated fashion. The goal is for the customer to have a consistent experience across multiple channels, and for the organization to have a common view of each customer's interactions and contact histories.
Call centers are labor-intensive environments that have traditionally struggled with providing their customer service representatives with access to all the customer information and related information needed to quickly service incoming requests. For example, a customer service representative (CSR) may need access to customer records, policy information, billing systems, and other information that may be stored in disparate back-end systems and data sources. What's more, many customers now want to help themselves to that information.
CRM products can help insurers serve their customers better by allowing CSRs or the customers themselves to access any information they need, whenever they need it, via whatever mechanism they choose. Customer service should be viewed as a comprehensive process applied across multiple e-business applications, rather than as an isolated process. Success depends on how well a customer service application enables an insurance company to change customer-centric processes as emerging trends, customer demand, and requirements change.
From a CRM product perspective, these customer service needs translate into a wide variety of functional requirements, including:
Support for multiple contact channels, with the ability to create a common view of the customer across all channels—From the CSR's perspective, it is important to have a single view of the customer. This means tracking the various channels through which the customer interacts with the carrier, understanding the information requests at each point, tracking the current status of any pending requests, and reporting on contact histories. With a common, unified view of the customer, the company can ensure consistent service and follow-up, no matter which combination of interaction channels the customer chooses to employ.
Support for customer self service—Many customers want to help themselves to information rather than talk with a customer service representative. These users need access to a wealth of content to satisfy their requests, such as frequently asked questions (FAQs), recent bills and statements, policies and product documentation. By providing rich content around customer transactions and self-service activities, organizations can increase the value of their customer service operations to their customers. Many CRM systems provide a central online "knowledge base" to support customer self-service, while others rely on integrating the disparate back-end systems that may exist within the organization (see table on page I14).
Integration with back-end systems and repositories of content and data—The content that customers may require often resides in disparate systems or repositories. A good CRM solution should provide a means to integrate this information for easy access by customers and CSRs alike.
Ability to automate the business processes required to deliver customer service—While many call centers already utilize technology for queue management and routing in order to effectively handle incoming inquiries, such capabilities must also be provided for the myriad electronic contact channels that customers may choose to use. A good CRM system should provide a unified mechanism for automating customer service processes and workflows across all channels.
Personalization—Customer service applications should provide customers with content that is related to their current activities or navigation. For example, a customer that has recently moved and is looking at information for a new homeowners insurance policy should also be presented with information about a new life insurance policy. Personalization enables organizations to reach their customers with more impact, and to generate new revenue through cross-selling and up-selling.
Detailed reporting and analytics—These capabilities allow organizations to leverage the information contained in their back-end systems, as well as in the CRM system itself, to identify key data such as customer trends, demographics, tendencies, and preferences—data that can be leveraged in personalization and marketing efforts.
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