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The Role of Marketing in Insurance

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The Role of Marketing in Insurance

In our daily lives, we are often faced with major decisions such as buying a car, renting property or travelling to a destination. In making such decisions, the question of how we can cover ourselves in case any eventuality, inevitably pops up. This usually leaves us with no choice than to get insured, in case of a rainy day.

With many insurance companies such as Vanguard Assurance, Enterprise Insurance, SIC Insurance Company Ltd., Star Assurance, Provident Insurance among others, gaining ground, just how attractive are the numerous insurance policies to the ordinary customer?  What are some of the challenges the insurance industry faces and how can Marketing be a solution to some of these challenges?

Insurance basically means protection from uncertain financial loss. Even if the loss is not necessarily financial, it can eventually be quantified in financial terms. The types include life insurance, vehicle insurance, and property insurance, among others. Though insurance is a necessity that cannot be overlooked, the customer before selecting an insurance policy will reason things out with questions such as ‘How does this insurance package benefit me?’

What can the insurer therefore do to build the confidence of the actual or potential customer, whilst remaining profitable? Insurance packages are not tangible products; therefore the insurance marketer must be very strategic in promoting the image of the service. Before he or she can do that however, there has to be some background information about the market. The insurer needs to understand the needs of the target audience, before they can be convinced to patronize the insurance package.

Any effective insurance company is one that values relationships. Letting the customer know he is the central focus of the business, and establishing a strong relationship with them is the magic key needed to unlock booming business in the insurance industry. A personal connection with the customer could be initiated through calls, occasional visits and thoughtful acts such as birthday wishes.

When the insurer knows the market, and a strong relationship has been established, what next? There is a need for an effective strategic plan, both short term and long term that involves practical ways by which sales can be boosted. Any well-meaning insurance company needs to have clear and feasible objectives and goals, and implement them judiciously.

Constant evaluation on the part of the insurance company could help reveal cracks such as “Why do we have to keep charging higher premiums in spite of higher interest rates and resulting higher return on investment? How responsive are our customers to these constantly increasing premiums?” It is always vital to get feedback from customers in order to know what can be done next to carve a niche in the customer’s mind. The most common form of advertising is by word of mouth; therefore the customer always has to be satisfied so he or she promotes a positive image of the company to potential customers.

With the insurance industry facing tough challenges such as undercutting (where some insurance companies set their rates ridiculously low as compared to competitors, in order to attract more customers, without necessarily delivering value), any insurance company that wants to stay on its feet needs to constantly come up with strategic and sustainable (but ethical) ways to keep up. Effective marketing could just be the game changer.

On a lighter note, we do not need to think about preparation only when it comes to choosing an insurance policy. As H. Jackson Brown Jr. puts it, “The best preparation for tomorrow is doing your best today.”  The time to make any decision or choice in preparation for your future is now.

 

 

 

 

2 Comments

2 Comments

  1. Christopher Agyeman

    September 23, 2016 at 8:13 pm

    Nice work , The insurance industry is grateful

  2. David Avor

    September 23, 2016 at 9:44 pm

    Very educative piece. Thumbs up

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