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CONSUMER Ronnie Bowes reviews the findings of a report into consumer understanding of protection insurance. It seems that product knowledge is in short supply When it comes to insurance, we need to be much better at supporting the customer journey. This is the stark message from a report produced by The Syndicate, a research initiative for the UK life and health industry. It is entitled Where Are We On The Consumer’s Radar? Navigating A Route For Protection Insurance and it focuses on four themes: the consumer psyche, education and engagement, the role of the employer, and technology. To support the report, a survey was commissioned of 3,000 adults in the UK. The findings show that consumers are confused and lack clear guidance on their financial planning, particularly when it comes to insurance. When asked what type of insurance was the biggest priority for them, half said it was life insurance. However, 80% of respondents could not accurately identify the correct description of how a basic life insurance policy works. On the positive side, critical illness (CI) and income protection (IP) were considered more important than mobile phone and pet insurance.
Lack of understanding When consumers fail to understand or interpret our products it can result in purchasing decisions that don’t meet their needs, a lack of trust and a reduced value in the products we offer. This is exacerbated by too much choice, similarity of products and a lack – or overload – of information. Consumers doubt whether they have chosen the right product. A complex and timeconsuming purchasing process also adds to their insecurity. Nearly a third of respondents were stressed by the choices available when researching protection policies. Having shed some light on where people’s priorities lay in terms of insurance, the research then explored how much consumers really understood about the products that they
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THE ACTUARY • May 2013 www.theactuary.com
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