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5 ways insurance companies can leverage customer data to empower their marketing

Blog Sep 27, 2022

With the digitization of physical records and data collected online, the insurance industry is flooded with customer data that they never have had access to before. The value of that data is not lost on insurers – according to a global survey by Deloitte, seven in 10 insurers plan to increase spending on data-related technologies, with nearly 70% of that spending going to collection and analytics, respectively.

However, as most insurance companies are more traditional with regard to data, they are not extracting the most value from it – therefore, they are losing out on opportunities that can help improve results in their marketing activities. There are many creative ways data can be used to improve marketing agility and, in this article, we will discuss some of them to help insurance companies leverage customer data on hand to step up their marketing strategy.

  1. Optimize customer communication & messaging

Insurance marketers are tasked with developing content whose messaging speaks directly to the needs and pain points of their customers. The good news is, according to a recent survey in 13 markets, 72% of respondents are willing to share some form of personal data for cheaper insurance premiums. Of those respondents, 33% were willing to provide data in the form of fitness and health tests, 32% were willing to share via smart home devices, and 29% would provide data from wearable devices. With the data collected and predictive analytics applied, compelling personalized messages can be created in a targeted manner to move potential customers smoothly through the sales funnel.

Rather than marketing around the same evergreen topics such as marriage, childbirth, or retirement, a marketer can reference relevant customer data to help create a more targeted communication.

  1. Develop personalized lead acquisition campaigns

Quality of leads is crucial to insurance marketers, and accurately identifying the potential value of leads is essential to maintaining efficiency throughout the process. With the data collected about your existing customers, lead management can be much more effective.

For example, marketers can use existing customer data to craft a look-alike model that lets them focus on leads that resemble the most high-valued customers. Using data and automated lead scoring helps marketers identify a lead’s specific needs or interests before approaching them with an insurance product. This way, prospects are more likely to be interested in your services and make it to the end of the sales funnel.

  1. Identify leads that are close to conversion

Data analytics can do far more than just help you anticipate which kind of customers to approach – it can also help you to score leads that are already in the process to better determine which are marketing qualified leads and sales qualified leads.

The way this works is through assigning leads that are engaged in the customer journey with certain values tagged to different data points. Using these data points as a reference, marketers and sales can identify when a lead is closest to conversion and then take the appropriate action, whether it is to provide end-of-funnel sales content or to arrange an in-person meeting.

  1. Create actionable insights to retain customers

Buying insurance products constitutes a major-life purchase decision, which means the costs of acquiring a customer are correspondingly high. According to Lynn Thomas, president of 21st Century Management Consulting, the insurance industry has the highest customer acquisition costs of any industry, with it costing insurance companies seven to nine times more to attract a new customer than to retain one.

With an individual customer requiring such a high acquisition cost, insurance companies need to be constantly working to provide a better customer experience to retain customers, and data is one of the best use cases that can be deployed for this effort.

One way of using customer data is through the analysis of intent data. Intent data lets insurers identify policyholders who are considering leaving and helps agents to take the appropriate action by offering insurance products more closely fitted to customer needs. On a broader scope, the data collected can also help insurance companies to understand why certain products or services aren’t clicking with a particular customer group and adapt their insurance products accordingly.

  1. Upsell & cross sell

Even if a customer is currently happy with their insurance, there is always an opportunity to upsell or cross sell them with a suitable product. Leveraging existing customer data can make the process much easier.

Insurance companies can use life event data to identify when a customer is undergoing a new stage in their life and suggest a supplemental policy. It could come in the form of increased medical coverage for ailments that could arise from age or an entirely new policy to cover children in the event of serious illness or injury. A good insurance marketer is always keeping an eye out for new sales opportunities, and data on life events is a great way to stay on top of this. Insurance companies that use customer data to stay agile are sure to get a leg up on competition.