The claim is the great moment of vulnerability for property andcasualty insurers. Many insurers have invested heavily inimproving the claims experience, and, according to Accentureresearch, customers are generally satisfied with the way theirclaims are handled. In a global survey of nearly 8,000 auto andhome insurance customers, only 14% of those who had filed a claimexpressed dissatisfaction with the way their last claim washandled.

That sounds good – but the survey also indicates that of the 14%who are unhappy, fully 83% either plan to switch to a new provideror have already done so. And the claim itself is a trigger forswitching, no matter how satisfied customers are with theexperience. The mere fact of having filed a claim increases thecustomer's likelihood of switching from 22% to 41%.

The two most important factors that influence customersatisfaction—aside from the perceived fairness of the settlementitself—are the speed and transparency of the claims process (bothidentified by 94% of respondents who had filed claims). These arefollowed by the customer's ability to contact the insurer anytimeto find out the status of the claim, and good, timely communicationthat keeps the customer informed (both 90%). Empatheticinteractions with the insurer's staff are also an important factor(86%), as is the ability to engage with the insurer using thepreferred channels (80%).

While the claims experience plays a powerful role in influencingcustomers' decisions to switch providers, other factors are alsoimportant. For example, 44% of respondents said that they wouldswitch providers if their preferred digital channels were notavailable for actions such as first notice of loss, checking thestatus of a claim and checking on the status of repairs orreplacement.

Customers are also quick to turn to social media, either toreport on a good claims experience or to complain about a bad one;29% of respondents said they had either posted or planned to postabout a positive experience, while 30% said they had either postedor planned to post about a negative experience. And 44% either reador plan to read such reviews.

Anything insurers can do to increase the proportion of satisfiedcustomers will have a direct benefit in terms of customerretention. Insurers that are also able to use their claimsperformance as a differentiator – establishing their reputation(especially on social media) as an insurer that is committed tosettling customers' claims quickly, fairly and transparently – willincrease retention and also improve their chances of acquiringdisaffected customers who are looking for a new provider.

We saw that the claim itself – whether it is handled in way thatsatisfies the customer or not – greatly increases the likelihood ofthe customer switching. It might be that the claim rouses thecustomer from an apathetic acceptance of the terms of his insurancepolicy and spurs him to compare other companies' offerings. Or itmight be that “satisfaction” implies that the customer regarded theexperience as fair and efficient, but not particularly empathetic,and certainly not a pleasure.

Whatever the reasons, carriers should do whatever they can toreduce the incidence of claiming. This is likely to happennaturally as more new vehicles are equipped with systems that helpdrivers park their cars or automate parking altogether. Taken toits logical conclusion, drivers of autonomous vehicles such asthose which Google is testing should never have to file a claim,unless they are the victims of theft or damage caused by otherdrivers.

Accenture has long asserted that insurers need to put thecustomer first, and to shape their organizations and processes –and develop their products and services – with the needs of thecustomer foremost. To do this, of course, insurers need to have adeep understanding of their customers, and the claim is anopportunity to capture a great deal of information which they mightotherwise never have access to.

Carriers that can acquire and analyze this data will not only beable to enhance their segmentation and provide more differentiated,relevant service; they will also improve their claims preventionmodelling and fraud detection capabilities. Good data will alsogive insurers deeper insights into why different customer segmentsdefect, allowing them to develop specific retention strategies.

Many insurers spread service initiatives too thinly in awell-intentioned but possibly misguided attempt to delight everycustomer every time. Instead, they should adopt a more focused,segmented approach based on value analytics and the customer'spropensity to defect. An efficient claims operation anticipates thecustomer's service needs based on data captured throughout theinsurance lifecycle.

Digital technologies – based on good data – offer insurers atremendous opportunity to transform the claims experience acrossall of these dimensions. By enabling them to become morecustomer-centric, proactive and agile, they lay a solid foundationfor cost reduction, growth and an enduring competitiveadvantage.