Don’t let policyholder misconceptions stop your insurance brand from improving digital customer experience

Don’t Let Policyholder Misconceptions Stop Your Insurance Brand from Improving Digital Customer Experience

Change is good, we fear change: myth-busting policyholder resistance to better UX. 

It’s not all that easy to pursue digital innovation in the insurance industry. If you’re part of a marketing, design, or user experience team at an insurance company, we see you nodding your head right now.

It’s not your fault. Take a cautious industry selling extremely complex products based on decades-old legacy software — then throw in a tendency to under-value user experience design — and the result is a major case of inertia.

Definition: Yep, you studied it in physics class. Inertia is the tendency to do nothing, or to remain unchanged. A.k.a, the complete opposite of innovation. 

How often have you heard sentiments like these from stakeholders across your insurance company:

“Oh no, no, no. We can’t change that. Our policyholders will freak out.”

And just like that, user experience ideation ends. Valuable feedback is ignored. Good ideas are not pursued. Digital innovation projects are scrapped.

It’s time to get serious about asking a new question: “Is it true? Will our policyholders really freak out?!”

And what if they do? The even more critical question lurking beyond our entirely logical concern for existing policyholders is this:

“How long will digital customer experience inertia serve the life and health of our insurance business as a whole?”

The answer may be “not long.” More and more insurance companies are waking up to the fact that today, digital experience IS customer experience. And while your insurance products may be intent on keeping policyholders safe, no customer base is secure from the inevitable march of time.

To grow, or even maintain business volume, your insurance brand must attract new policyholders. New policyholders are often:

• Younger: Born digital, entering the insurance space with user expectations shaped by ordering packages in one click, or pizza via emoji.
• Less experienced: In business in general, or with the insurance need they must meet — and therefore more sensitive to friction.
• More reactive: Harder to win and keep, likely to check out competitors or quickly jump ship if expectations are not satisfied.

At least on the high level, your long-standing policyholders may be more loyal, a bit older, and a lot less likely to text emojis to Domino’s. But beware. Don’t underestimate existing policyholder appetite for frictionless online insurance experiences — or their willingness to jump ship.

No matter how long they’ve been a customer, been in business, or been alive on this planet, there’s no question your policyholders have busy lives filled to the brim with things that have nothing to do with managing insurance policies.

Decision-makers certainly don’t want to spend a second longer than necessary determining whether to buy or renew a policy from you. They don’t want to struggle to understand how to take action or maintain coverage.

Process-doers responsible for day-today insurance coverage management — the task-oriented process team members — just want to get whatever it is done fast so they can move on.

Keeping all this in mind, what happens when you ask policyholders whether they like your sites, online tools, or other digital customer experiences? Before you answer: we know what happens. 

They tell you, “YES.”

Yes, of course they like you well enough. They are policyholders because your service is working for them. But that’s not the whole story.

Rather than pat yourself on the back, it’s time to ask different questions.

Here’s the thing: Your policyholders have put in the effort — and it may have been an extremely painful effort — to learn your systems. Where processes didn’t make sense, they created work-arounds. When they didn’t exactly understand a concept, they just figured out how to muddle through.

What does this look like?

They’ve got pencil-scribbled post-its on their monitors, reminding them how to navigate that counter-intuitive step that trips them up every time. And when they make the same old error anyway, they just sigh. And try again. Being sure to squint at that one post-it this time. Ugh!

We humans don’t like these kinds of “hold you breath and hope it works out,” experiences. Though we NEVER want to go through the pain of re-learning something so painful, muddling through is NOT the same as being confident, comfortable, satisfied, or happy.

So, how can you bust the myth that positive digital customer experience changes will suddenly turn happy customers unhappy, creating a tsunami of policyholder unrest? Here’s what we’ve learned:

Do the right research.

Digital innovation comes from research, not guesswork. Talk to policyholders — not to see if they are “happy,” but to understand where they struggle. Accept the truth that for policyholders, “change is good,” and “we fear change” are both true.

Carefully analyzing the details of what policyholders have to say can end seemingly endless stakeholder debates. “We’ve talked to so-called ‘happy users’ across the financial services industry. When we look at each detail of the digital customer experience, we inevitably reveal better ways to satisfy and delight them,” says Mark Power-Freeman, user researcher at Praxent.

Truly test your theories.

Will a new digital experience really work for new prospects and existing policyholders alike? There’s no need to take a leap of faith. Rapid prototyping gets stakeholders aligned and lets real users guide the way to on-target UX improvements.

It’s not about stakeholders debating over static images. It’s about real prospects and policyholders clicking and tapping to accomplish realistic tasks. “We build working prototypes that bring our UX recommendations to life for users. When we’re onto something, they tell us!” says Deanna Dial, former VP of Client Services at Praxent.

Plan proactive support. 

No matter how mind-blowingly better a new digital experience is, it’s still a change, and change is hard. Be sure to set policyholder expectations — let them know change is coming, give them options, and tell them how it will benefit them.

Build in tool tips and tours. Offer demos and quick training videos. And of course, prepare for an increase in customer service calls. Analyze caller feedback carefully, and you may find a lot of “happy surprise” once policyholders see how much easier you’ve made things for them.

Stand on strong convictions. 

If your organization has done user research, tested the design with policyholders, and are standing by to support them, be confident. People don’t like new things. But once they see benefits, attitudes change fast.

“User experience is ever-evolving, and that means digital innovation must become a core competency for a service business like insurance,” says Tim Hamilton, Founder of Praxent. Whatever policyholder reactions to a UX improvement may be, keep listening. Intake their feedback, assess good ideas, and pursue agile change as you learn what’s really working for them.

None of this is easy. But harnessing the power of digital innovation is critical for service-based business. New, digital business models are a big reason why more than half of the Fortune 500 have disappeared since the year 2000.” And as IDG finds, the top industries ripe for digital-first business strategy are services (95%), financial services (93%) and healthcare (92%).

The myth that your policyholders are happy the way things are won’t save you. The truth is, they aren’t. There’s always room for improvement — and if you don’t make the effort to improve, another insurance brand will.

So, how can you be an insurance industry change agent? When stakeholders tell you positive user experience changes aren’t possible because the risk of upsetting policyholders is too great, practice these responses:

How might we set expectations? Policyholders are people. They don’t like surprises unless it’s a party thrown in their honor. Establish a practice of communicating with policyholders, letting them know ahead of time about changes that will impact — and improve — their lives.

How might we highlight our responsiveness? Your insurance brand isn’t making changes just for fun. Be sure policyholders can offer feedback, then let them know you’re working to address their feedback. When you make changes, show them that you are responding to policyholders.

How might we prove benefit? Humans are social creatures. We’re influenced by what others think. If possible, create a circle of policyholder advisors who sign up to be your guinea pigs. When they love a new user experience, capture their reactions to share with — and encourage — other policyholders.

How might we offer more control? Policyholders are busy, busy people. Your launch date may not be a convenient time for any given customer to: Learn anything. Change anything. Do anything extra. Instead, plan a rolling launch. Empower your policyholders to choose the right time to upgrade their experience.

How might we support the transition? Prepare for upset customer service calls. It’s going to happen, and it’s ok. Use each call as a chance to bond with policyholders. Show them new interactions and benefits. Soon they will be extremely happy — and get mad when you change anything in future!

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Pursuing digital innovation is a company-wide commitment. Clearly, the user experience team won’t have all the answers — but by acting as a change agents, marketing, design, and UX resources can help insurance companies get to real answers.

Your goal is to defy insurance industry inertia and build digital momentum. Always ask “how might we …” to break through assumed blockers, open up ideation, and deepen discussions. Don’t let popular misconceptions about policyholders prevail. Get higher quality conversations started, now.

After all, failing to improve digital customer experiences for fear of upsetting existing policyholders isn’t a sustainable answer for today’s insurance companies.

Pursuing legitimate user experience upgrades while setting policyholder expectations, giving them more control, and offering proactive support is.

Change is good, we fear change. This human reality must be part and parcel of your insurance company’s digital innovation roadmap.

Yes, changes, may freak your policyholders out for a minute. But satisfying an irritated customer is a great way to bond — especially when policyholders see how much better life is with your new digital experience.

In the end, a superior digital customer experience will impress both loyal policyholders and brand new prospects. They’ll perceive your insurance brand as responsive to feedback, and working hard to make life easier.

And, they’ll tell a friend.

Want to learn more? Explore Praxent’s experience with improving digital customer experiences for insurance brands.