Insurance industry embracing social media but struggles with pace of change

02 March 2018 7 min. read

While insurance companies are strongly committed to using social media channels for branding and customer service, they are leaving potential untapped, according to a new study. Facebook, LinkedIn and Twitter remain the most important social media channels for insurers, particularly as they seek to grow their market share among Millennials.

As numerous digital platforms continue to grow exponentially, a well-maintained social media presence has become an increasingly vital asset for most modern businesses. From the consulting industry’s emulation of social media to ease workloads, to the world of football implementing social networking strategies to grow its international fan base, companies across all industries now recognise that they cannot be left behind.

A new study, titled ‘Social Media Insurance Monitor’, conducted by consultancy firm ITDS among 20 major global insurers from 11 different countries, shows that top insurance companies all are on social media such as Facebook, Twitter, LinkedIn and YouTube. At present, the insurers have a combined 10,393,683 fans and followers on social media. Facebook, with almost 1.9 billion monthly active users worldwide, is by far the most popular network, commanding the biggest share with nearly 7.7 million fans, up by 2% from the previous year. The famous social network is followed by LinkedIn, which saw the insurance industry heavyweights’ number of followers grow by 12% to over 1.9 million. On Twitter, the insurers have over 700,000 followers, up by 6%.

Meanwhile, Facebook-owned Instagram, a photo-based channel that’s widely used by consumers and quickly growing in popularity with 700 million monthly active users, is barely used at all at the moment. While 80% of insurers have an Instagram account, few make active use of it. Instagram’s follower-base enjoyed the biggest year-on-year growth though, up 44% to 103,000. This is an opportunity for insurers, according to researchers, as in other sectors the channel is used very professionally with return on investment.

Activities of the 20 insures in 2017

However, use of social media is not just an upwards trend. Popularity of Pinterest in fact fell compared to the previous year, while only 5% have embraced WhatsApp, although this number is forecasted to grow strongly as WhatsApp rolls out its company functionality throughout this year.

Largest presences

When it comes to the fan base of individual insurance companies, not surprisingly, the top six most popular insurers on social media hail from the United States; Farmers, State Farm, New York Life, MetLife, Allstate and Geico. The first non-US player is Allianz, with the three remaining top 10 positions also taken by European insurers; Generali from Italy, Zurich from Switzerland and Mapfre from Spain. There are two UK insurance companies on the list; Aviva, in 12th position, and Legal & General, in 20th.

Activity per channel, however, differs. On average, the insurers posted 17 messages per month on Facebook, 42 on Twitter and 7 on LinkedIn. An average of 6 videos per month were uploaded on YouTube. Overall, the 20 studied insurers posted a total of 5,329 messages on Facebook, LinkedIn and Twit­ter and received over 32,000 messages on Facebook, up 17% from last year.

The ITDS researchers highlight that it is not only about numbers, though. Engagement is just as important, because brands that have higher awareness and more connectivity usually enjoy a larger market share. The authors state, “The challenge is to create brilliant content, so get to people in the moments that matter to them. Be relevant to them and get to know them. It’s all about engagement.”

In their broader online endeavors, insurance firms have fully embraced mobile technology, as a result of the smartphone boom. Nearly all the insurers (19 out of 20) have responsive websites; in other words the website is the same as the desktop site but it automatically scales down to the mobile device. 19 of the 20 insurers also have smartphone apps, which are used by insurers for different purposes. While one insurer might use an app as a news source, another might use it for managing insurance purposes.

Customer service

Firms can also leverage social media as a powerful customer service tool. 80% of the insurers surveyed by ITDS responded within two hours of receiving questions from consumers on their Facebook page, up significantly from last year’s 50%. On Twitter, 75% of the insurers responded within two hours. Twitter, especially, has become an important resource for customer service. While previously only six insurers offered Twitter as a customer service channel last year, this year 11 did, an increase of 84%.

Fans per insurer

Reviews, however, are not fully embraced. In the particularly volatile environment of internet comment sections, this is most likely out of a fear that opinions of more vocally critical consumers could put other clients and potential customers off from engaging, or investing. Only 4 of the 20 insurers (20%) show consumer reviews on their website. On Facebook, the review option is often disabled, with just 10% of insurers allowing visitors to post or read Facebook reviews. In this respect, insurers are way behind other sectors, particularly when you consider that two-third of consumers based their product choice on user reviews and peer-to-peer advice.

Further, the researchers draw three other conclusions. First, insurers simply are not using chatbots enough. All over the world, consumers are quickly finding it easier to use the chatbots deployed by companies, services and retailers. However, insurers are still failing to use these auto­mated discussion partners, which are able to maintain con­tact with customers through chat services like Facebook Messenger. In an age in which Artificial Intelligence and ma­chine learning are increasingly being accepted as the norm in other industries, insurers are once again lagging behind.

Secondly, millennials are still not being taken seriously enough by insurers, despite the fact that this generation has long since matured into consumers. Insurers are not active on the messaging platforms where this demographic spends its time, and subsequently companies are missing out on a user experience that’s specifically attuned to the tastes of that group. What’s more, they barely share reviews with them.

“Insurers are simply are not yet commanding a presence on the various channels on which existing and future customers are to be found,” write the experts from ITDS in the report.

Finally, the international insurance industry is way behind in the area of “user experience”, even though insurance disruptors like Trõv and Lemonade have long proved that insurers can indeed make their portals, websites and apps much more user-friendly. While this means it lags well behind other sectors, however, it also means that, unlike the retail sector for example, the insurance industry has not hit its peak for social media dissemination, presenting an opportunity for firms to exploit in future.

Drawing an overall line under the developments, the authors of the study conclude that embracing online and social media is imperative to future growth, and yet most insurers are struggling to keep up with rapid developments in the space. Investing further and working together on innovation and digital with a broader ecosystem, including innovative startups, are earmarked as key levers for success.

For more insights from the report download the 'Social Media Insurance Monitor: Global Edition' from the website of ITDS.