Insurers shouldn't overlook existing customers as a fertile field for additional revenues, according to a new study by the Chief Marketing Officer Council.
The study found that consumers are open to consolidating policies with insurers and buying additional products if marketers focus more on retaining current customers and on cross-selling and up-selling.
The study also found that those involved in marketing insurance products feel a "sense of frustration" over budgetary constraints that have stalled investment in data analytics programs, which in reality could help jump-start robust lead flow through more targeted and engaged prospect and client opportunities.
The study by the Palo-Alto, Calif.-based group found that while some insurance providers do this well, many are overlooking opportunities to multiply their business with existing customers. Instead they are focused on acquiring or poaching new accounts.
The findings were included in a study titled "What's Critical in the Insurance Vertical," sponsored by InfoPrint Solutions Company.
It found that marketers in the insurance industry have a "tremendous opportunity to increase customer lifetime value by executing data-driven, targeted retention marketing strategies."
Yet many industry marketing units feel they must focus on acquisition strategies or servicing the needs of top-performing or strategic accounts, the study said.
The study determined that more than 55 percent of consumers polled have held their existing insurance policies for more than five years and are open to receiving information from their trusted providers on new or complementary services.
It found that 21 percent of consumers purchased policies or increased the value of their existing policies after receiving communications.
"Unfortunately, only 7 percent of marketers in the insurance area value up-sell and cross-sell tactics as a critical route to revenue," the study found.
More than 100 insurance marketers provided insights on how they market and sell insurance, while more than 1,100 consumers provided feedback on their experiences shopping for insurance and selecting providers.
The study noted that the insurance industry's net premiums total more than $1 trillion annually.
There are more than 2,700 property/casualty insurers and more than 1,100 life/health insurers in the U.S., the study said, citing Insurance Information Institute data.
The study found that 42 percent of insurance marketers have determined that their customers are going online and are demanding more self-service and always-on options.
When asked, however, consumers indicated that while the online solutions are a convenience they appreciate, they still value easy-to-understand policies, statements and contracts more, the study found.
In fact, the study found that as marketers focus on self-service and online applications, only 27 percent value online payment and 16 percent value self-service online tools, while 40 percent value easy-to-understand policies, statements and contracts.