When a policyholder decides to change their insurance provider during renewal, it affects you and your company’s bottom line.

In this blog post, we’ll explore the common causes why policyholders don’t renew, and provide practical strategies to prevent them from leaving.

By proactively addressing these issues, you can increase policyholder engagement and retention.

Why Policyholders Switch Insurance Providers

A worried young couple is reviewing their finances in the kitchen. They are surrounded by papers and a laptop, with the woman looking at documents and the man leaning his head on his hand, gazing at the laptop screen. A coffee pot, cup, and houseplant are also on the table, suggesting a domestic setting.

“Why has my premium increased this year?”, “Is there a cheaper policy that still meets my needs?”, “How much longer will it take to process my claim?”

These are just a few of the questions you’ve likely heard a policyholder ask prior to switching home insurance providers.

Policyholders moving insurance companies can often be attributed to a few key issues, such as:

  • High premium costs
  • Inadequate coverage
  • Poor customer service
  • Lack of trust
  • Poorly bundled policy packages
  • Technological inefficiencies
  • Financial incentives for switching to a different insurance company

Strategies to Address Policyholder Concerns

A miniature house with a red roof is positioned centrally against a teal background, symbolically protected by a white umbrella directly above it. To the right of the house, there’s a small round bush in a red pot, adding a pop of color and life to the composition, conveying the concept of home insurance protection.

It is imperative to adopt proactive strategies that address policyholder concerns around cost and coverage and enhance overall customer satisfaction and retention to protect your bottom line.

Below, we’re exploring a range of effective prevention techniques that insurers can implement to mitigate the risk of policyholders leaving their insurance company at the time of renewal.

Offer Incentives & Emphasize Your Value

From September 2022 to September 2023, home insurance rates rose 8.2%. (Statistics Canada)

This increase in home insurance premiums results from factors such as climate change, supply chain issues, and inflation.

Faced with escalating insurance costs, policyholders are increasingly reconsidering their policies and providers.

However, you don’t have to stand by and watch your customers switch to your competitors come renewal time. Here are three proactive measures you can take to counteract competitors offering lower rates:

  1. Implement a customer loyalty program that rewards customers for their continued business. This program could include reduced premiums after a certain period, benefits for claim-free years, or special offers on combining multiple policies.
  2. Provide flexible payment options to make premiums more manageable for policyholders. This could include monthly payment plans without additional fees or the option to change payment dates.
  3. Focus on the value provided by your services that competitors may not offer. This can include superior customer service, faster claims processing, and added benefits such as free roadside assistance or customized coverage options. Demonstrating the overall value of your offerings can often outweigh the allure of lower premiums elsewhere.

Go the Extra Mile to Explain Their Coverage

Picture this scenario: A homeowner discovers significant mould damage in their basement—a result of slow, unnoticed leakage over several months.

Assuming their home insurance policy covers all types of water damage, they file a claim, only to learn that their policy specifically excludes damage caused by long-term leaks and gradual deterioration.

What’s next? Upset, annoyed, and stressed-out policyholders who are considering switching insurance companies when their policy is up.

Before this situation occurs, we highly recommend providing ample resources, such as a newsletter, email, or information sheet with policy renewal details to ensure policyholders are fully aware of what their policies cover.

It may also be helpful to provide examples of potential scenarios, like the slow leak damage, to educate them before any issues arise.

Provide Exceptional Customer Support

According to Salesforce Research, 80% of customers say the experience a company provides is as important as its product or services.

In the context of home insurance, where clients rely heavily on timely and empathetic support, particularly during stressful claims processes, inadequate customer service can be a critical point of failure.

Let’s face it: If you were recently displaced or had to file a claim and your adjuster was late responding to your emails or lacked empathy for your situation, you may consider changing your insurance provider, too.

Here are some tips on how you can provide better customer support to your policyholders:

  • Ensure that all communication is clear, concise, and timely. Policyholders appreciate quick updates, especially about claims status and what steps they need to follow. Regular communication can alleviate anxiety and build trust.
  • Show empathy and understand the emotional state of the policyholder. Adjusting your communication style to address their concerns compassionately can go a long way in providing support and making them feel valued.
  • Implement follow-up procedures where an automatic email is sent to the policyholder after a claim is processed to ensure they are satisfied with how it was handled and address any lingering concerns.
    • Pro tip: if your policyholder says they had a good experience, consider sending them a thank you card to show appreciation for their Google review!
  • Use online portals or mobile apps for claims and policy management, equipped with chatbots to address straightforward questions instantly. This frees up your time to focus on more complex inquiries.
  • Consider investing in newsletters, blog content, or social media marketing to educate your customers about how their insurance can protect them beyond basic coverage.

Invest in ALE Management Solutions

If your policyholders become displaced, they may rely on you to help them secure immediate and adequate accommodations. However, they may become frustrated or feel neglected if you’re busy managing other claims or don’t have the right connections to help them find temporary accommodations that meet their needs.

That’s when you can turn to ALE management solutions for support.

Companies that provide ALE management services, like Accomsure, can help you meet your policyholders’ immediate needs during times of crisis, mitigating the chances of them switching to a different provider due to feelings of neglect or poor customer service.

Here are a few reasons why you should partner with an ALE management company:

  1. Displacement claims are complex and time-consuming due to each policyholder’s unique needs and circumstances. ALE management companies facilitate this process by handling communications and budget allocations for additional living expenses, allowing adjusters to process claims more efficiently.
  2. ALE management companies act as intermediaries, managing the documentation and validation of additional living expenses for displaced policyholders, ensuring that expenditures for temporary housing comply with policy terms, reducing the administrative burden on adjusters.
  3. Working with an ALE management company can lead to substantial cost savings in claims, as these companies expertly negotiate temporary accommodation costs to ensure accommodations can be covered within policy limits.

Prevent Policyholders Switching to Your Competitor, With The Help of Accomsure

A cheerful businesswoman with curly hair is shaking hands across a table with a male colleague, whose back is to the camera. She's wearing a tan blazer and has a bright, engaging smile, suggesting a positive interaction or agreement. There is a laptop open in front of them, indicating a professional setting.

Partnering with Accomsure for ALE management during a claim offers a strategic advantage in preventing policyholders to switch home insurance companies at policy renewal time.

Accomsure helps insurance adjusters enhance their service offerings, increase customer satisfaction, and maintain loyalty even in challenging circumstances.

With Accomsure’s expertise, insurers can ensure that their policyholders receive the attentive ALE support they need during their times of crisis, solidifying your reputation as a reliable provider who truly cares about your policyholders’ needs.

Submit a claim or contact us today to learn more about how we can support you and your displaced policyholders!