Nothing erodes the customer-business relationship quite like a data breach. In fact, almost one in three consumers will cease their interactions with a financial institution that failed to protect their personal information, according to a recent ISACA survey. But cybersecurity isn't just about preventing leaks — it's also about building trust and loyalty.
Cybersecurity is an especially vital topic for the insurance industry, which provides products that are designed to give peace of mind and security. To be competitive in the insurance marketplace, companies need to prioritize their cybersecurity strategy while making sure existing and future customers recognize the work being done to protect their personal information. Doing so can help with customer acquisition and build loyalty with your existing base.
Driving acquisition with cybersecurity
Identity theft reports have increased by nearly 70% since 2019. One of the key ways insurers can differentiate themselves from the competition is by building and maintaining a reputation for keeping their customers' data safe at every step. That often starts with either the onboarding or online quote-tool flow, which is one of the first areas where customer experience plays a major role in acquisitions. Highlighting how the company is keeping data safe during that process can tip the scales in your favor.
For example, whenever you require personal information from prospective customers, adding a note or question box associated with the first instance can help you clarify the level of security that's in place to keep their data safe. It's also a good thing to be transparent and call out exactly how information can be used, especially with passive data collection via website cookies. That way, customers are aware that cybersecurity is something the insurer is taking seriously and that they can expect transparency should they use that company.
Additionally, there is progressive profiling, which essentially means that you're not asking for certain sensitive data up front — instead, the more customers interact, the more information you can collect. Given that 68% of U.S. consumers are concerned about the level of data being collected by businesses, this approach can be helpful in attracting those new customers. After all, the more context you're able to provide with minimal effort on the part of your customer, the better.
Building a retention strategy with cybersecurity
Beyond acquisition, there are several ways that a strong cybersecurity strategy can be addressed to help insurance companies maintain their customer bases:
● Looking at internal safeguards: 85% of data breaches are caused by human error, so educating employees about cybersecurity threats and common mistakes is essential. Most companies with an IT department require some sort of regular security training. This includes covering topics like how to avoid phishing scams and best practices for dealing with and storing customer data.
● Guarding against external threats: Protecting systems from threats via features like cloud encryption is vital to building a long-term acquisition and retention strategy since it can help stave off data breaches. And, of course, this also means keeping systems up to date and investing in security measures from the back end, as well as keeping an eye out for opportunities to improve.
● Focusing on customer-facing features: Identity and access management is vital to cybersecurity, and it's something your customers will have to contend with every time they log into their account. So, ensuring that you have some kind of multi-factor authentication is vital to both keeping that data safe, but also building trust by signaling that safety to customers. It can also help to offer customers options for customizing their sign-in security measures, such as using a PIN or getting push notifications, since it lets them choose an option that feels best to them.
● Offering cybersecurity support: Offering personal cyber insurance through products like home insurance can be another way to help signal a commitment to cybersecurity. These products allow insurers to provide additional support to customers who may be worried about the potential costs associated with cyber extortion and attack damages, while covering some of the growing costs associated with implementing additional cybersecurity features.
Insurers offer a wide variety of products to protect against cyber risks and ensuring that customers understand what coverage is available and how to mitigate their exposures creates a strong partnership that benefits all.
