Seventy Percent of Insurance Customers' Loyalty at Risk as Retention Challenges Escalate Finds Capgemini and Efma's World

Seventy Percent of Insurance Customers' Loyalty at Risk as Retention
Challenges Escalate Finds Capgemini and Efma's World Insurance Report 2013

Fifty percent of Insurers look to Mobile and/or Social Media in next two years
to strengthen customer experience

PARIS and NEW YORK, Feb. 27, 2013 (GLOBE NEWSWIRE) --With an average of only
30 percent of customers globally reporting having positive customer
experiences with their insurers, insurers will need to address
multi-distributionand customer experience concludes the sixth annual World
Insurance Report 2013 (WIR 2013) released today by Capgemini and Efma. The
report also finds that mobile and social media channels are gaining traction
with insurers in terms of early adoption rates.These distribution channels
can help insurers provide better customer experiences as well as capture
operational efficiencies. The WIR 2013 is based on 16,500 customer surveys,
research data from 41 markets, and interviews with 114 insurance executives.

According to the WIR 2013, the insurance industry's focus is shifting from
pure cost reduction and operational efficiency initiatives to revenue building
and brand loyalty strategies while lowering mounting customer acquisition
costs.Heavy emphasis is on multi-channel distribution strategies with keen
interest on how to leverage lower-cost sales channels like mobile, internet,
and social media.Mobile and social media are a priority for more than 50
percent of insurers surveyed globally over the next two years.

Positive Customer Experience is More Meaningful than Just Measuring Customer

Customer experience reflects the entire customer lifecycle while customer
satisfaction is just a one-time measure of how products and services meet or
surpass customer expectations. On average, the WIR finds that approximately
only one in three customers across 30 countries studied in the report's new
Customer Experience Index (CEI) had a positive experience with their insurance
company, while 62 percent registered positive customer satisfaction
levels.Additionally, the WIR finds that nearly two out of three customers are
at risk of retention with only a neutral and/or negative customer experience.
"When customers have neutral or negative experiences with an insurer,
opportunities are created for insurers to 'court' other carrier's customers,
and customers may switch even for minimal extra benefits," says Jean
Lassignardie, Chief Sales and Marketing Officer, Capgemini Global Financial
Services. "Even in theUS, the country with the highest customer experience
ratings, insurers still face a risk of retention rate of 50 percent meaning no
one is immune."

Mobile and Social Media are Opportunities to Increase the Customer Experience

A majority of insurers are viewing mobile as an important access point for
supporting the overall customer experience (especially in areas like quotes,
claims, and relationship management) rather than just as an additional sales
channel. And while insurance customers prefer online for activities like
finding best price and comparing policy coverage, they still prefer physical
distribution networks (agents and brokers) when it comes to gaining brand
trust. The top five reasons for insurers to invest in the mobile channel are:
anytime/anywhere/any device demands; keeping up with the competition; customer
service costs; increased smartphone adoption; and cross-selling/up-selling

The report explores four key mobile focus areas from insurers categorized as:
'early winners and must haves' (areas with high ROI potential) to evolving
areas such as 'must watch' and 'wait and see.' Among insurers surveyed, the
leading mobile services offered today and those with high ROI potential over
the next two years include: product information via mobile (43 percent
today/91 percent by 2015), claims services (16 percent today/73 percent by
2015), quotes (23 percent today/70 percent by 2015), Straight through
Processing (9 percent today/55 percent by 2015), and policy changes (9 percent
today/52 percent by 2015).

Similarly, social media offers insurers new ways to increase their market
penetration and increase the effectiveness of their customer
retention/acquisition strategies. According to the WIR, a majority of global
insurers (59 percent) are already leveraging social media but very few have
integrated it into their overall enterprise-wide CRM strategies leading to
sub-optimal results.The report suggests integrating social media strategies
with traditional CRM will create "social CRM" enabling enhanced positive
experience for customers' and insurer branding propositions.Patrick Desmarès,
Secretary General, Efma adds "Another possible way for insurers to improve
their customer experience ratings would be to look at the banking industry
model. Even though banks have many more interactions with customers, their
high customer experience ratings indicate best practices in data analytics,
market segmentation, and cross-channel integration are being implemented."

Ongoing industry efforts to improve Operational Efficiency

2011 was a year of many catastrophic events such as the tsunami triggered by
an earthquake in Japanand extreme weather conditions in the US and Australia
resulting in a total economic loss of US$370bn of which US$116bn was insured.
These external events had a negative impact on operational efficiency^1 in the
insurance industry overall. However, insurers in geographies not affected by
these market events have continued to make significant headway in making
operational improvements in areas like underwriting and claims. These
operational improvements efforts are working and should continue. Areas that
have paid off in operational improvements include: systems and technology
investments; realigning distribution channel strategies, claims
transformation, and productivity improvements.

About Capgemini

With more than 125,000 people in 44 countries, Capgemini is one of the world's
foremost providers of consulting, technology and outsourcing services.The
Group reported 2012 global revenues of EUR 10.3 billion. Together with its
clients, Capgemini creates and delivers business and technology solutions that
fit their needs and drive the results they want. A deeply multicultural
organization, Capgemini has developed its own way of working, the
Collaborative Business ExperienceTM, and draws on Rightshore®, its worldwide
delivery model.

Learn more about us

Rightshore ® is a trademark belonging to Capgemini

About Capgemini's Financial Services Global Business Unit

Capgemini's Global Financial Services Business Unit brings deep industry
experience, innovative service offerings and next generation global delivery
to serve the financial services industry. With a network of 21,000
professionals serving over 900 clients worldwide Capgemini collaborates with
leading banks, insurers and capital market companies to deliver business and
IT solutions and thought leadership which create tangible value.

More information is available at:

Rightshore® is a trademark belonging to Capgemini

About Efma

As a global not-for-profit organization, Efma brings together more than 3300
retail financial services companies from over 130 countries. With membership
from almost a third of all large retail banks worldwide, Efma has proven to be
a valuable resource for the global industry, offering members exclusive access
to a multitude of resources, databases, studies, articles, news feeds and
publications. Efma also provides numerous networking opportunities through
work groups, online communities and international meetings.



^1Operational efficiency is calculated by totaling the insurance operating
costs and then dividing by the gross written premiums. When the costs are high
(such as from insurance claim payouts) then the operational efficiency is not
as good.

Capgemini Press contacts:
Marta Saez (EMEA)

Weber Shandwick

Tel: +44 207 067 0524


Cortney Lusignan

Weber Shandwick (NA and all other regions)

Tel: +1 212 445 8192


Efma Press Contact:

Karine Coutinho


Tel: +33 1 47 42 69 82

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