Why giving back is good for business
1st August 2017The ways in which insurtech is transforming insurance products through new technologies is widely publicised, but it’s not just about technology. There is also, increasingly, a philanthropic aspect to the new propositions emerging as they seek to deliver 'value' to the customer in new ways.
In the US, insurance startup, Lemonade, for example, has grabbed headlines with its commitment to give back fees remaining after claims to charitable causes nominated by its customers.
Exploring ways in which insurance retailers can give back, whether to the community or customers, offers a new and exciting way to transform the image of the industry.
Exploring ways in which insurance retailers can give back, whether to the community or customers, offers a new and exciting way to transform the image of the industry.British insurance company, Guevara, and German, Friendsurance, have taken a more 'co-operative' approach, offering their customers peer-to-peer payment based insurance. Both companies allow policyholders to form groups and pay premiums into a cash-back pool, allowing members of the group to get money back at the end of they year - if they don’t file any insurance claims.
Appealing to millennialsThe consensus is that companies with a strong commitment to community are more attractive to customers; research shows that 70% of millennials will spend more on brands which support causes that they care about.
Corporate Social Responsibility (CSR) offers customers a 'feel good factor' that boosts their morale and encourages brand loyalty. An example of CSR success is the Easy Fundraising 'feel good shopping' concept. Thousands of household brands, including John Lewis, Interflora and The Body Shop, have subscribed to the website, pledging to the customer's nominated cause as thanks for shopping with them.
Building brand loyaltyMoreover, research shows that more than 90% of consumers are more likely to trust and be loyal to socially responsible businesses compared to companies that don't show these traits.
New insurtech brands are increasingly seeking to build relationships with their customers that go beyond simply a legal contract to provide insurance. Reward schemes, advice geared towards reducing claims and promoting safety, as well as community investment initiatives, are all new ways in which insurance companies are seeking to engage their customers.
Developing a reputation of philanthropy is a genuine method of building a strong reputation and supporting networks in the business and consumer community. It is perhaps even more urgently needed in an era where insurers are perceived in the same category as bankers and insurance viewed as a 'necessary evil'.