The insurance industry in the United States is brutally competitive. It takes over $1 trillion in annual premiums and employs 2.8 million people. Nearly 6,000 insurance companies contribute a big chunk to the country’s overall Gross Domestic Product (GDP). This competitiveness makes it a constant uphill battle for insurers to gain leads and grow the customer base. That is where email automation can help bolster insurance marketing.
It’s common for insurance professionals to struggle with creating demand, generating leads, nurturing them, converting them, and retaining customers. Most companies offer similar products, which increases the already fierce competition. This requires insurance marketing teams to reach out to customers and build trust. Email marketing can help nurture trust gradually, leading to a growing Return on Investment (ROI).
Insurance companies spend considerable amounts of money on marketing and business development. Let’s discuss how email automation might just give insurers the edge they’re looking for.
The Email Marketing Landscape
Before we delve into the advantages of email automation for insurance marketing, let’s first understand the current landscape of email marketing.
Studies estimate that there are about 319 billion emails sent out across the globe every single day. As shocking as this number may seem, what’s even more astounding is that 180 billion of those are spam. This means that nearly half of all emails sent and received end up in spam folders. But this should not deter marketers from doing their best.
There’s a widespread myth circulating across the internet that email marketing is dying slowly, and social media is replacing it. However, actual statistics paint a different picture. Email revenues were approximately $7.5 billion in 2020 and $12.3 billion in 2024 and are expected to climb to nearly $18 billion by 2027.
“Revenues from Email are expected to climb to $18 billion in 2027, from $7.5 billion in 2020.”
One of the biggest advantages of email marketing is that more than 90% of adults online use email. The number of email users worldwide is estimated to be at 4.5 billion and is expected to climb to 4.8 billion by 2027. What’s more, over 60% of consumers prefer brands to contact them through email, and over 88% of email users check their inbox multiple times a day.
So, all of these numbers indicate that email marketing is a potent tool for advertisers to reach out to their potential customers. The proliferation of smartphones has only made it easier for advertisers to leverage the power of emails for their campaigns.
Email Marketing Automation and Customer Loyalty in Insurance
The insurance industry has one of the highest customer acquisition costs. This shouldn’t come as a surprise since insurance companies spend large amounts of money creating policies, advertising them, and onboarding new customers. The industry’s profits are based on long-term retention of existing customers and steady acquisition of new ones.
The average retention rate of customers is 84% in insurance, while the top companies boast a rate of up to 95%. This 11% difference between the top companies and everyone else can represent a major dent in profits. Studies have shown that a steady 5% increase in your insurance company’s customer retention rate can almost double your profits in five years.
So, what is the secret to building loyalty and retention?
One of the best ways to cultivate loyalty and retain more customers for your insurance company lies in automation. To be more precise, automating emails helps you develop personal relationships with every single one of your customers. This allows your company to offer personalized experiences to all of them.
Let’s explore all the advantages of using email automation for insurance marketing:
Augment Staff Capabilities
This is the first and most obvious advantage of using email automation. It allows a relatively small team of agents to maintain regular contact with hundreds or even thousands of customers. Platforms for email automation, such as Mailchimp, HubSpot, and Drip, enable your team of agents to use relevant customer data and craft automated emails personalized to every customer.
These emails could be for anything from payment reminders and policy renewal notifications to premium receipts and policy change updates. The best part about using such platforms is that they allow you to send out relevant, pre-built email campaigns. They let you “do it once and forget about it.” Email automation solutions eliminate the need to send out emails manually to every customer on every occasion.
Higher Retention Through Frequent Communication
Automated emails allow you to stay in touch with every customer frequently. You can pre-program emails for birthday wishes, New Year greetings, festival offers, bonuses, and more. This lets you build a personal relationship with every customer, which in turn makes them feel valued. As a result, customers are more likely to remain with your company and recommend you to their friends, family, and acquaintances.
Cross-Selling Opportunities
This is one of the biggest advantages of setting up email automation for insurance marketing. Every automation platform for emails can aggregate customer data from multiple sources, which helps insurers identify potential needs. This creates enormous opportunities for cross-selling different insurance policies for existing customers.
For example, a customer who bought car insurance from you might be interested in home or personal loans. Insurance marketing teams can set up automated emails to offer these products at critical moments, such as a claim or policy renewal. This not only leads to a higher ROI in marketing but also maximizes the customer’s lifetime value for the company.
Customer Segmentation
Not all customer are the same, and the same goes for their needs. So, it is highly important that you only deliver relevant content to the right audience. That is where segmentation can help insurance marketers manage their email lists better. It allows them to divide their audience into smaller groups based on preferences. These preferences could be based on their gender, location, age group, medical condition, and others.
“49% of consumers feel frustrated when they receive irrelevant content or offers.
82 percent of consumers favor messaging that treats them like an individual.”
Segmenting your audience into relevant groups enables you to tailor emails to resonate with customers. When potential leads feel that the insurer is keenly aware of their needs, they are more likely to become paying customers. In other words, targeting email boosts engagement rates, which leads to higher conversion rates.
For example, sending timely automated emails reminding customers to renew their policies will lead to fewer delays or lapses.
Analytics-Driven Insights
Software for email marketing automation typically features tools for analytics. These tools provide insight into customer behaviors and the effectiveness of email campaigns. Email automation platforms analyze metrics like open rates, click-through rates, and conversion rates, which help insurers adjust their strategies accordingly.
The degree of insights provided is highly precise. For example, the data on a campaign can show which emails were opened by how many people on which days and times. The insights drawn from this data can indicate the best days to send emails, the most likely people to respond, and other valuable insights. This allows insurers to schedule their automated emails accordingly and target them in the best way for maximum impact.
Cost Efficiency
The first byproduct of automating any workflow is cost reduction. It is no secret that high-volume manual tasks are laborious, time-consuming, and prone to human errors. Email automation minimizes the need for manual human intervention in routine communications like policy renewal reminders, premium receipts, and claim updates.
Insurance marketing teams can program routine emails and personalize each mail as per every recipient’s individual data. This takes away the time and effort needed to track the dates and manually send the emails to each customer. As a result, there is a marked increase in operational efficiency and cost savings, as fewer resources are required for day-to-day communications.
The best part about using email automation for insurance marketing is that it allows the marketing teams to focus on more important tasks.
Common Automation Processes For Insurance Marketing
Automating emails for insurance marketing can help companies streamline many processes. Let’s talk about some of the common ones that can propel insurance marketing:
Lead Generation and Conversion
Generating and converting leads is the heart of marketing activities. Whether in insurance, finance, or any other industry, marketing is all about developing leads and nurturing them until they become paying customers. When it comes to insurance, understanding each customer’s unique needs and building a relationship with them is a proven way to generate and convert leads.
Automating insurance marketing will empower companies to attract potential customers and convert them into permanent ones. Hyper-personalized emails can target specific audiences and establish a rapport, which eventually results in lead conversions.
Claims Management
Getting an insurance claim can become extremely stressful for customers. A big chunk of all the complaints insurance companies receive is about claims handling. Tools for insurance marketing automation can allow companies to streamline the claims process and provide customers with timely updates. As these are automated, there is almost no delay in sending them out. Rapid communication from the insurer is a proven way to improve the overall customer experience and lower the workload for insurance employees.
Policy Renewal
Absent-mindedness and stressful lives are the main reasons why many people neglect to renew their insurance on time. This causes the policy to expire, and the insurance company likely loses a customer. Such customers may be charged additional fees for the delay, which is likely to ruin their experience. However, insurance marketing automation can help companies retain existing customers by automating policy renewal reminders. Marketing teams can set reminder emails for every customer a few days before their due dates and not worry about such communications.
Customer Support
Customer experience has become one of the most important drivers of growth in every industry. When it comes to insurance, nothing speaks more about good experience than timely customer support. Insurance marketing automation can help companies improve support by automating customer interactions and providing personalized responses.
“60% of insurance executives rank an excellent customer service experience as having the highest impact on successful competition.”
Automating customer interactions not only reduces the workload on support teams but also improves customer satisfaction. When customer feel that they can interact with their insurer and receive responses quickly, they are more likely to feel valued and remain with the company.
Conclusion
At a time when personalization and individualized communication are the key drivers of customer retention, email marketing automation has emerged as an excellent tool for insurance companies. The strategic use of automated emails in insurance marketing is a great way for insurers to increase their ROI. It improves marketing efficiency and customer engagement and, most of all, cultivates trust.
FlatworldEdge is a global leader in delivering transformative IT solutions for companies across every industry. Our email automation solutions help insurance marketing teams take their lead-generation activities to the next level. By automating email marketing, insurance companies can nurture leads better and convert them into loyal customers faster.
Contact us today to know how you can supercharge your marketing workflows.