Study: How insurance firms rank on treating online customers

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By: Wise Marketer Staff |

Posted on April 8, 2005

The insurance industry has shown a qualified improvement in responsiveness to online enquiries, according to The Customer Respect Group's latest study of customer respect on the internet, but these firms continue to share consumer data without permission at a higher rate than many other industries.

Research and consulting firm The Customer Respect Group has published the results of its Q1 2005 Online Customer Respect Study of the USA's major insurance firms.

Teachers Insurance and Annuity Association College Retirement topped the Life and Health list, while The Progressive Corporation did best in the Property and Casualty category (and best overall). The study assigns a Customer Respect Index (CRI) rating to each company, which is a qualitative and quantitative analysis of customers' online experience when interacting with company web sites.

The average CRI (for all industries) based on 595 surveys of corporate web sites in various industries throughout 2004 was 5.9. However, the firms in this latest study scored slightly better at 6.1. This is encouraging for the sector, as in the last insurance companies report in 2004, the sector's score was slightly below average.

In the area of responsiveness, fewer online enquiries went unanswered in this study. The number almost halved from 36% to 19%. This compares well with the all-industry 2004 average of 26%. But although enquiries that received a reply within an hour rose slightly to 14%, the number that were answered within a day fell from 67% to 54%. This may be at least partly explained by the fact that while some companies have made additional efforts to reply to enquiries, they haven't yet put systems in place to reply in a timely manner (one day is the acceptable limit, according to internet users).

The average number of enquiries that are responded to within a day or less across all companies in all industries in 2004 was 67%, so the insurance industry appears to be in a transition stage.

In the area of privacy, however, there was very little improvement. In general, insurance firms have continued to share user-submitted online data with business partners and other third parties without permission at a worrying rate. While the all-industry 2004 average was 24%, and the insurance industry's 2004 average was 34%, the Q1 2005 study revealed that the rate is climbing slowly, now standing at 35%.

A concerning trend on the same "privacy of personal data" theme is the increasing difficulty customers reported in controlling the use of their personal data. In an ideal world, customers should choose to 'opt-in' to cross-marketing activity but only 20% of insurance companies gave this option. Half of the firms surveyed have no obvious way for customers to choose to 'opt-out' either.

Similar trends
"We're seeing some of the same trends in the insurance industry as we saw in the recent financial services study," said Terry Golesworthy, president for The Customer Respect Group. "There are some gains in responsiveness, but they are offset by continued privacy issues. The stakes are the same in both industries: users object to having their data shared with third parties or even internally without their permission. Insurance firms would do well to address this issue before users begin to defect to sites that do a better job of protecting their data."

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