A study of 50 life insurance companies focusing on how they treat their online customers has found that life insurers as a whole rank poorly when it comes to protecting customer privacy and safeguarding personal data.
The information comes from The Customer Respect Group (CRG), an international research and consulting firm that focuses on how corporations treat their online customers, which recently released findings from its Fourth Quarter 2006 Online Customer Respect Study of the Life Insurance Industry.
The study evaluated 50 websites as a representative sample of the industry's leading companies. Using a common set of criteria, it was designed to bring objective measurement to the analysis of online performance from a customer's perspective, says CRG, Ipswich, Mass. A directly comparable Customer Respect Index (CRI) is provided for each company. The CRI is a qualitative and quantitative in-depth analysis and independent benchmark of a customer's experience when interacting via the Internet.
The overall CRI score for the life insurance industry was 5.1, which was significantly lower than the overall cross-industry average (C-IA) of 5.8 for all sites evaluated in 2006, the researcher notes. This industry rating represents a slight drop from the last report.
According to CRG, the life insurers were rated poorly for their willingness to share personal data. "Two in three (66%) state that they share personal data either with affiliates, business partners or third parties," says CRG. "This does not compare favorably with other industries surveyed in 2006, of which only 46% share personal data. Furthermore, the majority (82%) of life companies that share data do not allow customers to opt-out; this compares with the C-IA of only 56%." Likewise, only a third of the life insurance companies that use personal data for ongoing marketing allow users to opt-out (vs. 79% for the C-IA).
"There is a continued low and disturbing level of transparency in the industry, with 26% of companies not clear about data privacy policies," says CRG. "This is significantly worse than other industries, where the overall number of companies that are unclear is down to 8%."
The CRI is composed of 3 overriding concepts identified by customers as their critical concerns when using websites:
o Site Usability–How usable is the site to a wide range of users?
o Communication–How willing is the company to provide customer service in the form of one-on-one communication to respond to specific questions?
o Trust–Can the site be trusted with personal data?
CRG adds that 'site simplicity' remains the highest scoring area and is in line with overall averages. "In no area does the industry exceed the C-IA; only in 'attitude' (accessibility) does the rating even match the C-IA. In 'trust,' the industry scored 5.1 on the 10-point scale against the C-IA of 5.8," the researcher notes. Despite the low score, however, "this does represent a slight improvement from the last report because of small upgrades in policy transparency, with no measurable change in the actual policies in place. The 'online communications' score, already at the bottom of the industry table, actually declined slightly to a discouraging 3.7 on the 10-point scale."
The best-rated companies overall were Thrivent Financial for Lutherans, Pacific Life, Mutual of Omaha, Western-Southern Life, Nationwide Life, New York Life, Northwestern Mutual and Western Reserve Life Assurance of Ohio, says CRG. In the individual sub-indices, highest rated for 'trust' was Penn Mutual. For 'online communications,' Western-Southern Life topped the list; for 'site simplicity,' New York Life bested the group, and in 'attitude,' which covers accessibility and other factors, IDS Life came out on top.
According to CRG, the life insurance industry achieved the dubious distinction of having the highest percentage of companies scoring 5.0 or below, at 44%. "A score of 5.0 or below generally illustrates that a site fails to adequately respect the online user," the researcher says.
