When employees feel valued and they have the tools and information they need to do their jobs, they perform better, which can translate directly into higher customer satisfaction. This is true of any industry, but particularly insurance, where the experience customers have with frontline employees dictates their long-term loyalty.
Loyal customers are generally cheaper to serve. They spend more, stay longer, and promote their insurer to friends and family, according to Bain & Company research.
Unfortunately, insurance traditionally has a high attrition rate and low levels of employee satisfaction, but that can change.
“Great leaders don’t just innovate the product. They innovate the factory,” said David Burkus, best-selling author of “Under New Management,” at the recent Property Innovation Summit.
Here are some powerful and practical steps that insurers can take to boost employee satisfaction and reap the rewards in terms of productivity and creativity.
Honing the Hiring Process
A typical hiring process generally involves a phone call followed by a couple of interviews. Hires are made after perhaps three hours with the candidate, and a high proportion do not live up to expectations. Maybe the hiring process needs to be revised.
Unstructured interviews, reference checks and work experience are all poor predictors of how someone will perform once hired, according to the University of Iowa’s Frank Schmidt and Michigan State University’s John Hunter, who analyzed 85 years of research. The best predictor is a work sample test, but that fails to take into account how the candidate will work with others.
One innovative idea that employers like Whole Foods and others are testing is to make the hiring process a joint effort among team members. If the candidate gels well with the team, the team can vote to keep the candidate on board. This doesn’t just filter out poor performers, it identifies employees who share your company values.
Placing Higher Value on All Employees
If you show how you value your employees, they will in turn value customers equally. There’s a strong and undeniable correlation between customer retention rate and profitability. Building loyalty depends upon creating positive experiences for customers. It can start with showing how you value employees.
For employees and claims adjusters to excel in their interactions with customers they need to have the right information at their fingertips. Sometimes the traditional structure needs to be turned on its head, because customer-facing adjusters understand what’s needed to satisfy customers, and their managers should be facilitating them.
There’s nothing more destructive to morale than feeling powerless to make a change that you know will improve the level of service you offer.
After a bad experience, 13 percent of claimants switch to another carrier immediately and 40 percent switch within the next year, according to the J.D. Power 2016 U.S. Property Claims Satisfaction Study. Conversely, 81 percent of highly satisfied claimants renew their policy and recommend their current insurer to others.
Real-Time Performance Reviews
Employee recognition, transparency and performance feedback are vital if you want happy employees, and shifting from annual reviews to frequent check-ins is highly effective, according to the 2017 Employee Engagement Report, from TINYpulse.
An informal discussion once a month that covers what they’re working on, what’s expected, what went well and what you can do as a manager to ensure they can be more effective in their job is enough. It doesn’t need to replace the performance appraisal or generate paperwork. But it can be tremendously motivating, because employees feel they are making progress.
It’s a great opportunity to show your adjusters and investigators that you care and to ensure that everyone is on the same page. It also means there are no surprises for either side when the annual review rolls around.
Turning Down the Noise
“Everybody’s job is now coming up with ideas and solving problems, whether it be for the company, for the client or both,” said Burkus. “We need to shift a little bit about how we manage in that environment.”
Open-plan offices, frequent face-to-face meetings and 24/7 access to work communications via mobile devices have increased productivity to some extent, but they’ve also turned up the noise for employees. The level of distraction and stress has soared in the modern age, and it’s important to be mindful of that. People need quiet periods of time and spaces where they can really focus.
Innovation is a key driving force behind any insurer’s success, but sometimes that creativity must be directed toward organizational structure and processes. Empowering adjusters to make positive changes will have a positive impact on the entire business, because there’s an inextricable link between satisfied employees and satisfied customers.