Social Media Insight for Insurers
Contributed by Ranjit Kumar Agarwal & Mani Tiwari
We identify strategic areas where social media will have maximum impact for the insurance industry.
Social media – networking, bookmarking, blogging, micro blogging and instant messaging – is facilitating meaningful dialogue between individuals and businesses. For businesses, social media is a vehicle for effective advertising, market research, customer feedback and an ongoing relationship with customers. Many companies are waking up to the role of social media in a business context. Among Fortune 500 companies, for example, about 60% have corporate Twitter accounts and 56% are on Facebook.1
With insurers' huge workforce and diverse client base, social media represents a great business opportunity. The industry's dependence on interpersonal interaction makes it imperative for insurers to examine ways to leverage social media. Consumers who are connecting to their insurance providers are often seeking information about products, as well as special offers and promotions. Consumers are also posting their experiences on forums, blogs and tweets across a range of topics, providing insurers with the opportunity to understand how customers feel and how to increase customer satisfaction.
For example, New York Life uses social media to improve prospecting through online networking, increase the quality and quantity of leads, enhance existing customer relationships and improve the quality of service provided by agents.
Let's take a look at some areas where insurers can benefit from social media.
Prospecting, lead generation and efficient onboarding
A recent Fiserv survey of 3,000 U.S. consumers found that most respondents want to connect with their financial institutions via social media.2 One-to-one meetings between agents and prospects can be conducted through online chats, and product details can be explained and highlighted in forums, thereby reducing the time required for meaningful interactions, discussions and clarifications, which can lead to quick and efficient customer onboarding.
Underwriting, claims and fraud detection
Insurers can analyze data from the profile of customers' social networking sites for better decision-making during underwriting, as well as while processing claims. They can also study data generated by customer searches and purchase decisions to deliver better service and ensure loyalty.
Analytics and feedback strategy
Social media can help companies identify areas with which customers are dissatisfied and can be used by carriers as an effective feedback mechanism to improve performance and invest in areas for instant customer satisfaction. The comments generated in the social media space can be captured to understand customer sentiment. Companies can use focus groups and analyze competitor strategies to tailor products. For instance, insurers might think of reducing the cost associated with a particular term insurance plan during a recession if social media indicates that people like the plan but feel it's unaffordable at the current price.
Channels and customer service
Social media channels can allow insurance companies to proactively identify potential issues and warn customers in advance. For instance, new regulations or compliance requirements can be broadcast via social media channels, guiding customers to contact customer service with details.
Social media is a platform that insurers cannot afford to ignore. Insurers that have adopted the Internet as a complementary channel have gained immense advantages over late-arriving players.
Read Social Media Insight for Insurers (PDF) or learn more about Cognizant's insurance practice.
1 Nora Ganim Barnes and Eric Mattson, “The Fortune 500 and Social Media: A Longitudinal Study of Blogging and Twitter Usage,” Center for Marketing Research, University of Massachusetts, Feb. 17, 2010, http://www.umassd.edu/cmr/
2 “Financial Institutions and Social Media,” Fiserv, Inc., November 2010, http://www.fiserv.com/whitepapers_financial-institutions-and-social-media.htm