GlobalData Plc

Transparency key for SMEs at the point of renewal

SME insurers must strive to detail any potential changes to policies at the point of renewal in order to avoid leaving businesses confused or uncertain about the specifics of their new deal.

For SMEs, support and communication is high on the list of priorities when considering the types of services they would like to receive from an insurance provider. This is most important to businesses at particular stages of the engagement process with their insurer; namely in the event of a claim or at the point of policy renewal.

SMEs have become increasingly autonomous when it comes to their insurance obligations. They are more self-serving, efficient, and require less input from providers (aside from when dealing with claims), and for this reason the need for simplicity is ever more important. This is especially true during the policy renewal process, when businesses are often looking for an immediate and quick solution.

Simple policy explanations are among the highest service requests from SMEs, as noted in our 2016 UK SME Insurance Survey. Businesses want clear and concise descriptions to the point that any changes or alterations to their current arrangement are clear enough to be easily understood. According to our survey, 14.5% of all SMEs would like to receive simple policy explanations from their provider – ranking third on the list of services businesses across the SME spectrum most want. This figure is slightly higher (17.3%) for businesses specifically in the micro segment, of which many place more emphasis on simplicity and the reassurance the policy they have bought is correct and was purchased at a good rate.

Insurers must endeavor to avoid using complex descriptions, which according to the industry experts we spoke with can often mask vital details or leave the customer unsure of any potentially noteworthy differences between the policy they initially bought and the new deal. The fact that the need for simple policy explanations ranks so highly on the list of priorities for SMEs demonstrates the need for providers to do more and actively take steps to address the issue.

More providers, particularly commercial lines brokers, are launching services that promote easy access to advice, mainly in the form of large call centers to support an online proposition (e.g. Simply Business) or a call-back facility whereby customers can request a date and time to speak with an advisor.  However, when looking at general insurance services for SMEs, more could be done to ensure these businesses understand their policies with ease, especially when getting to grips with some of the more complex products available in the market.

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