The insurance industry’s sales and customer success teams are under pressure to deliver positive customer experiences faster than their competition. Customers expect an honest, positive experience in all end-to-end transactions like quoting, policymaking and policy activation.
So, what makes a positive customer experience?
Nearly 80% of all American consumers point to speed, convenience, knowledgeable help and friendly service as the most critical elements of a positive customer experience, according to a recent report by PwC.
Traditionally, an insurance company’s customer service team would answer every customer’s phone call and email and talk about how to do business with the insurer. That works, but the issue is scale.
Long wait times, language barriers and a high volume of client calls and emails have increased personnel costs and led to poor prioritization of cases and a weakened customer experience for many insurers. Today, rising costs and long wait times have led carriers and brokers to deploy insurance chatbots to meet increased demand.
Chatbots are changing the insurance industry’s customer service strategy:
- Close to 30% of life and property insurers have deployed chatbots in the last five years.
- Chatbots have become the leading application of AI in insurance for routine operations like customer service and lead management.
- By 2026, chatbots will fill 40% of all insurance industry customer service roles.
Whether rule-based or AI-enabled, chatbots lift resource constraints and drive customer service strategies across the insurance sector. As a result, chatbot deployment will remain a priority for insurers in the foreseeable future.
There are two main types of chatbots that insurers widely deploy: rule-based and AI-based. This article will consider rule-based bots.
Advantages of Rule-Based Chatbots
Rule-based chatbots follow a predesigned sequence of questions and commands that a given user will find helpful. To configure them, insurers must analyze data to anticipate what tasks users are most often trying to accomplish.
Users will choose among various options (e.g., “Help me file a claim,” “Help me complete enrollment,” “How do I adjust my plan?”), and, depending on their selection, the chatbot will direct them to the right resource.
A recent survey by Drift discovered the most common frustrations for customers are websites being hard to navigate, simple questions not being answered and contact information for a business being too hard to find. Rule-based bots can improve the customer experience by directing a user to the correct information immediately after being asked.
When a customer asks an unprogrammed question to a rule-based bot, it can transfer the conversation to a human. This ensures the chatbot can resolve simple cases while freeing capacity to deliver better customer service for more complex issues.
Based on the responses given by the user and how the rules-based chatbot is programmed, the bot can either give a written reply back or trigger a task such as sending out an email, sending the user to a different page, scheduling a meeting or issuing an invoice.
Best Practices for Rule-based Chatbots
High-quality, rules-based chatbots rely on rich data sets to respond to various user actions. For example, an insurer can plan different chatbot sequences depending on:
- Whether the user has visited the website before,
- What insurance product they’re looking at
- If the user has spent lots of time clicking through the website with little reading (“Are you having trouble finding something?”).
Rule-based chatbots are valuable for maintaining existing business. For example, let’s imagine a client’s policy renewal is coming up. Instead of going through a manual renewal process and answering tedious questions with the client, you could program the bot to recognize the logged-in user and ask the user if they want to purchase additional coverage or review their policy upon entering the website.
By effectively analyzing their user data, insurers can program a rules-based bot to appear with the right message, at the right time, to the right user, on the right device.
Rules-based chatbots are quick for insurance companies to implement but less flexible than their AI-enabled counterparts. This doesn’t mean rules-based chatbots are a poor choice. Every customer service team has three or four questions they get asked more than any other. Following the popular 80/20 rule, many insurers will be surprised to find how much time even a simple rules-based bot can save.
See also: Will Chatbots Take Over Contact Centers?
By letting bots guide customers to answers for routine questions, companies can better deploy staff. Representatives can answer the more involved questions that require the human touch. Freed from the majority of queries that don’t, they can take the time they need to provide the wow factor in service.
My next article will cover AI chatbots.