Looking forward to the end of the pandemic? I’m sure we can all agree that 2020 won’t end soon enough. On 3 December, we held a webinar on Zoom about how insurance brokers can not only prepare themselves for the future, but also close more deals in these difficult times.
The health insurance market and the pandemic
COVID-19 has significantly impacted the global economy, with the IMF forecasting an average contraction of 4.4%. As Moderna and Pfizer vaccinations appear on the horizon, business will start to adapt to these strange, new trading conditions. 2021 also marks the end of the Brexit transition period.
Despite all the drastic transformations in the public and private health sectors over the past 9 months, and the significant changes to how we manage our lifestyles, the health insurance market is one of the global sectors least impacted by the COVID-19 pandemic.
This, we believe, suggests a great opportunity for our brokers in a post COVID-19 world.
So, what have we learned this year?
- Based on 2020’s retention performance, customers value their health and protection benefits. No one is keen to relinquish their chosen plans, unless no other path is available.
- Customers are still willing to make financial commitments to protect their health, life, and income, provided there is flexibility, choice, and trust.
- Vulnerabilities exposed by the pandemic have given rise to a flurry on interest in life insurance.
- We have learned to live with new ways of engaging customers and concluding policies. This might mean servicing customers remotely, or issuing terms digitally where we previously might have sent physical copies in the post.
Here are some tips for adjusting and growing in the coming year.
1/ Diversify your expertise
The greater the range of support you can give customers, the greater loyalty—and potential revenue—you stand to gain. So if, like many brokerages, you specialise in a single benefit, now might be the time to demonstrate your value to your customers by expanding into other areas. For example, if you currently only offer private medical insurance, you could think about expanding into other benefits such as income protection.
Cross-selling is a way of demonstrating greater value to customers by offering them more. It makes customers more loyal and there are lower acquisition costs when dealing with customers you already hold.
3/ Use consultancy to stand out
There is no substitute for qualified experience. While customers have plenty of choice when it comes to intermediaries, those brokers who offer consultancy and advice can differentiate themselves in the market. As well as helping to win new business, consultancy can result in happier customers, enhancing value and loyalty.
4/ Review and evaluate
Customers’ requirements and budgets will change, particularly given the impact of COVID-19. Constantly evaluating and reviewing your arrangements will help you uncover opportunities to offer new and/or alternative cover solutions. Plus, it will lead to happier customers and possibly, increased revenue.
5/ Consider PMI-Lite
Lighter versions of traditional plans will still offer significant scope, but—with limits and benfit caps baked in—there is an opportunity to contain costs and an inherent benefit in terms of premium requirement. PMI-Lite is definitely something to be talking to clients about. It has appeal for existing customers as well as new business potential.
6/ Choose your segments carefully
Some industry verticals have been less affected by COVID-19 than others, so you may want to focus on these. Age demographics are another thing to look at. The average age of an IPMI subscriber is somewhere in the region of late 40s to early 50s. For the market to perform well, a younger demographic needs to be bought into play. So it’s incumbent on all of us to think about how we appeal to younger age segments by focusing on the longer-term value of international health and risk insurance.
7/ Work with providers on marketing
In a post-COVID-19 world, effective marketing will be essential to leverage new and existing business, and it’s an opportunity for us to work more closely with our broker partners. Marketing departments will be keen to lend their expertise, whether it’s in producing culturally-nuanced material or running joint campaigns for cross selling. It’s an area for brokers to focus on and we will very much lend our support.
8/ Move beyond expats
While they are still a significant source of business, expats are now less dominant in the market for international private medical insurance. Other groups, including local nationals, remote workers and students are important potential sources of business. So, you need to include them in your prospecting net.