Client expectations within the ‘Age of Client Obligation’

Six months after the implementation of the FCA’s new Client Obligation, the stress on insurers to place clients first continues to accentuate. Nonetheless, this stress isn’t solely coming from the heavy hand of regulation – it’s additionally coming from customers themselves.  

If you consider it, the Client Obligation couldn’t have arrived at a extra acceptable time. Over the past 12 months, we’ve seen file breaking premium hikes, customers financially squeezed by the deepening price of dwelling disaster and complaints hit a 5 12 months excessive. This can be a excellent storm that places customers at better threat of monetary detriment. 

On account of this concoction of things, what clients anticipate from their insurers is altering. And solely people who search to know find out how to meet these altering expectations will achieve a Client Obligation world.  

However the place to begin? By understanding your clients, after all…  

Rising expectations 

Over the past 12 months, we’ve seen unprecedented premium inflation. Within the twelve months to November, motor insurance coverage premiums rose a mean of 67%. House insurance coverage additionally went up nearly 40%. 

Analysis performed in July 2023 revealed that 69% of customers have felt the impression of the cost-of-living disaster, and 66% are frightened about with the ability to afford their payments.  

This mixture of things is pushing extra folks to buy round for insurance coverage at renewal. Nonetheless, with the world of twin pricing and widespread new enterprise reductions a forgotten reminiscence, and plenty of are left unable to discover a higher deal.  

When left on this predicament by no fault of their very own, customers are going to anticipate extra for his or her cash. And these expectations are going to proceed to extend alongside rising premiums.  

What do clients need? 

To reply this query, we surveyed over 1000 insurance coverage clients to seek out out what they anticipate from the expertise of submitting an insurance coverage declare. 41% stated cited velocity and effectivity in processing a declare high on the high of their record of needs – unsurprising given the hike in house and motor complaints pushed by delays in payouts reported by the Monetary Ombudsman Service earlier this 12 months.  

Nonetheless, extra curiously 40% chosen an extra choice – ‘the entire above’.  4 in 10 clients anticipate an ideal buyer expertise. And who can blame them. We stay in a world the place firms like Amazon and Uber exist, the place prompt gratification looks as if a proper, not only a privilege. These are clients that need extra and anticipate extra, and so they aren’t going away any time quickly.  



We went on to ask respondents that had beforehand made a declare, ‘Which of the next must be improved to make the expertise of constructing a declare higher?’, the highest reply got here in at 61% saying the ‘Velocity and effectivity of processing the declare’. So, not solely do clients anticipate velocity and effectivity, claimants are recognising that that is additionally the business’s greatest space for enchancment the place expectations will not be presently being met. 




What does this all imply for Client Obligation? 

It’s insights like these that show the necessity for such regulation.  

Some would possibly see the laws as extra of a nuisance than a profit, nonetheless they current a possibility for firms to assume and act otherwise and to do what’s proper for the client. It’s permission to interrupt time-old processes and the ‘that’s how we’ve at all times achieved it’ rhetoric. It’s an opportunity to create a legacy. 

Buyer expectations are presently not being met, and if the right storm continues to play out with out motion from the business, this expectation hole will solely widen.  

Client Obligation implies that it’s now crucial that the corporations accountable for delivering items and companies are delivering good shopper outcomes.  

To make sure buyer retention and satisfaction, it’s good to prioritise your efforts by actually understanding the important thing downside areas. We’ve developed a Client Outcomes Benchmarking service that helps you measure buying expertise, assist expertise, efficiency in assembly shopper communication preferences and repair expectations, and rather more.  



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