The U.S. property and casualty insurance industry has endured an unyielding hard market across business lines for several years. Strict underwriting rules and high rates continue to prevail thanks to obstacles like supply chain snags, high cost of goods and workers, catastrophic claims, and the rise in nuclear verdicts.   

The impacts of the hard market are sorely felt by auto insureds. Auto insurance premiums set to surge in 2024, an Insurance Business magazine article, notes that auto insurance premiums are expected to increase an estimated 12.6% this year.  

But difficult seasons can breed innovation, creativity, and growth. They also present opportunities for insurers to rise above the chaos and foster customer satisfaction — and even, potentially, gain market share in a crowded marketplace — through the development and application of new strategies and products.  

5 Ways to Promote Insured Personal Lines Customer Loyalty in Trying Times  

This isn’t an easy time for insurers or insureds. Speed to market is more important than ever for personal lines providers. Here are five ways insurers can sharpen their skills and embrace new technology to help ease the pain of the hard market.  

1. Communicate Transparently   
     
   Consistent and clear communication is key to gaining and keeping customers’ trust. Prioritizing effective communication, strong interpersonal skills, and a consultative approach can go far in diffusing customer agitation and allaying frustration.   
     
   A modern core system enables automated and one-off personalized messages to applicants, providing flexibility in communications. The industry is also beginning to see artificial intelligence (AI) functionality used to expedite communication workflows, improving timely transparency around policies and claims.   

2. Offer More Affordable Solutions   
     
   Provide options to make your coverage more attainable for your customers. Raising deductible amounts to enable lower premiums, offering discounts for low claims activity, and usage-based insurance options can make your policy a more attractive choice for those seeking to reduce costs. In fact, J.D. Power’s 2023 U.S. Auto Insurance Study reports that participation in usage-based insurance programs has more than doubled since 2016, with 17% of auto insurance customers currently participating.  
     
   A flexible core system makes setting up and refining these various rating and discounting options quicker and easier – an essential capability for keeping pace with rapidly changing technology and market demands.   

3. Deliver Quotes Faster   
     
   The sooner you can provide prospective customers with an accurate quote, the more likely they will be satisfied with the process and give you their business. According to Business and Technology Trends, 2024: Personal Lines, a report by global data provider Datos Insights, most personal lines agents rely on portals to quote new business.  
     
   An agile core system enables quicker quoting by tailoring questions to the applicant, prefilling applications with existing data, quoting multiple lines simultaneously, and utilizing AI to extract information from documents. Straight-through policy processing workflows for simpler use cases also promotes applicant satisfaction.   

4. Prioritize Ease of Use   
     
   Younger consumers expect companies to use technology that enables digital, user-friendly interactions, and their insurance providers are no exception. Look for ways to create a seamless customer experience and build that into your back-end process.   
     
   A unified core system creates a seamless customer experience by combining policy administration, billing, claims administration, agency management, document management, portals, and other functions into a single solution.  

5. Proactively Mitigate Claims   
     
   Consider what tools you have at your disposal to help prevent claims from happening. Advanced technologies like telematics and internet-connected devices support new ways to make more data-informed decisions. 

For example, telematics more accurately predict risk on a per-driver basis. They can also increase safety and reduce the likelihood of accidents and claims by promoting driver awareness of their own behavior behind the wheel.  
  
An API-enabled core system that allows for seamless integration with other third-party software and data providers can be used to help proactively mitigate accidents and claims for all insureds.   

A Modern Core System Is the Foundation   

Technology must do a lot of heavy lifting for insurers to successfully attract new customers and earn their loyalty in the context of today’s hard market. With the right modern core insurance system, your business will be well-equipped to not only endure the challenges in its path, but also to innovate and evolve with the changing expectations and needs of the younger customer base.   

Origami Risk provides robust, modern core insurance software that’s cloud native, constantly evolving, and designed to ensure all clients have access to the latest innovations. To discuss how our claims administration, policy administration, and billing solutions can help improve your organization’s ability to adapt to personal lines market trends and customer demands rapidly, contact us.