South Africans doubt insurers will be there for them during their time of need, as companies put their focus on adopting digital technologies to remain competitive, at the cost of a more ‘human’ experience.
This is one of the key take-aways from the latest South African Customer Satisfaction Index (SAcsi) looking at the short-term insurance industry, published by Consulta this week.
According to Consulta, there is a fallacy across many businesses that digital transformation and customer experience and satisfaction are interchangeable.
“They are not. Technology will change and evolve, but the fundamentals of being relevant and responsive to customer needs and wants on every aspect of the customer journey remain steadfast,” it said.
“Having all the best digital platforms, tools and apps does not translate into customer loyalty or satisfaction.
“If not managed correctly, digital transformation can create customer frustration and dissonance when aspects such as complaints handling, resolution and claims processing are ‘process driven’ rather than demonstrating empathy and trust to your customers,” said Ineke Prinsloo, head of customer insights at Consulta.
This was evident in the latest findings from the SAcsi in the sector, where the group found that “human insight, engagement, listening and empathy” were generally lacking from service providers.
Only a handful of providers meet and exceed customer expectations, Consulta said.
Overall, intermediated insurance brands performed better than direct insurers in meeting and exceeding customer expectations – this is put down to the importance of the advice process and helping customers understand exactly what they are covered for – and not covered for – and managing customer expectations at inception of cover and not at claims time.
On perceived quality, Virseker, OUTsurance, Old Mutual Insure and Santam lead the way on delivering a high-quality experience for customers, with most others providing a high quality, but undifferentiated experience.
Apart from the brands already mentioned, Hollard’s consistent and marked improvement especially in 2019 should be of significant concern to competitors as the result of their strategic interventions start bearing fruit.
In terms of Direct Insurers, Virseker takes leader position in the overall customer satisfaction index for the third consecutive year with a score of 83.2, above the industry par of 80.0 and also improving on its 2018 score of 80.7. OUTsurance comes in on par (81.5) while MiWay (77.6) scores below par on overall customer satisfaction.
With Intermediated insurers, Old Mutual Insure (81.2), Santam (79.7) and Hollard (79.1) are all on par; Auto & General (78.4), Momentum (77.8) and Discovery (76.2) all perform below par on overall customer satisfaction.
“While Discovery managed to make up some lost ground following years of decline, it is struggling on its trust measures with customers questioning whether they can rely on the insurer to do what it promises in their time of need,” Consulta said.
“Customers are expressing their dissatisfaction on measures of trust and peace of mind, and this is manifest across the business since it is unable to compartmentalise its business units – what happens in one affects all the other lines of business.”
It is worth noting that the latest SAcsi for short term insurance polled almost 4,300 consumers of short-term insurers during the second half of 2019 – before the global coronavirus pandemic hit.
During that time, crisis has indeed hit South African consumers, putting the findings of the index to the test.
As South Africans were forced into lockdown, and many losing income sources and the ability to pay, some insurers have implemented measures to ease the burden on their clients.
Outsurance, for example, reduced its premiums by 15% for customers, with MiWay and Santam following similar measures. Discovery, meanwhile, allowed members to use their medical savings to cover the cost of their insurance.