The Independent Uganda: You get the Truth we Pay the Price
However, more than three-quarters of the respondents are willing to recommend insurance in the future
Kampala, Uganda | JULIUS BUSINGE | Uganda’s insurance industry survey released on Sept.26 during the 57th CEO breakfast meeting in Kampala has provided valuable insights on customer satisfaction levels.
One central question, “are customers satisfied with insurance sector services?” was posed to 384 policyholders, leading to a comprehensive evaluation of various parameters.
Interestingly, the overall satisfaction across all aspects reached 72%, with specific areas showing distinct scores: premium payment process (77%), customer services (72%), communication from insurers (68%), claims handling (68%), and complaint resolution (52%).
Using the Net Promoter Score (NPS), a tool gauging customers’ willingness to recommend insurance, 77% responded positively. Among these, 66% fell into the category of promoters, while 11% were categorized as passives.
The survey emphasized that while an NPS score above 50% is considered great, insurers should aspire for an “amazing” experience, ideally above 80%.
The parameters assessed during the survey included customer satisfaction with premium payment modes, the nature and range of insurance products, claims handling processes, and complaint resolution processes.
In addition, the study sought to identify the key drivers of satisfaction and the challenges policyholders face in accessing insurance services.
The survey, conducted across regional hubs in Western, Eastern, Northern, and Central Uganda, targeted a study population of 204,598 policyholders. The final sample consisted of 384 policyholders although only 289 responded to the survey, providing rich insights into the sector.
Mixed views about insurance
The findings presented a nuanced view of customer experiences. Some respondents expressed satisfaction and confidence in the long-term benefits of their policies.
Others, however, shared instances of dissatisfaction and challenges, illustrating the need for improvements in the industry.
The mixed views reflected in the findings indicate the imperative to enhance services, addressing gaps that impact insurance penetration in Uganda, which has remained below 1% for years, one of the lowest rates in Africa.
For instance, one of the respondents during the survey said: “I started with one policy five years ago. My constant interaction with my insurance adviser gave me more confidence and I now have a running education policy for each of my five children to cater for their fees when they join secondary school.”
Another respondent said: “I had a savings policy for five years, unfortunately after two years, I lost my job, I however notified the insurer. After one year, I got another job, I then requested the insurer to extend the policy period and reschedule the payment period. They insisted that I had to clear all the arrears first for them to reinstate. The only option I had was to cancel the policy and lose all my earlier savings. To date, I still wonder whether the insurer wants to help people grow or become poorer.”
The third quoted respondent had this to say: “I visited a facility that was on the list of accredited providers for maternity services as my wife was due for delivery through caesarian section. I was advised that I needed approval first from the Insurer. When I contacted them, I was told that I should go to another facility because where I was, they wouldn’t cover that service.”
The respondent added: “I was disturbed and wondered whether it was actually in order for insurers to assume such a specialized role. I obliged because I had no option and went to another facility. Good enough all went well. I have since been wondering what would happen in case things went wrong.”
Another client said: “Your insurance people are very interesting. You sell me a policy in Gulu, and you want me to go to Kampala when it comes to payment. I think it is not fair at all.” “It took 8 days of walking back and forth to have a discharge voucher presented to me for signature. I signed, even when I was not happy with the amount of compensation offered. I was thereafter repeatedly told that someone would contact me to settle my claim and no one did until day 29 when I was called to pick up the cheque of Shs1.7 million.”
Clearly, the findings show mixed views on services provided by insurers – pointing to the need to make things better – to bolster insurance penetration that has remained below 1% for years, one of the lowest in Africa.
IRA CEO Ibrahim Kaddunabbi Lubega urged sector players to fill the gaps in their service.
“Everything you do think about the implications of your decisions,” he said, “Put yourself in the shoes of a policyholder when they are faced with challenges of accessing a service. Let us reinvent and do things better so we can remain relevant.”
According to the survey, the drivers of customer satisfaction are; the reasonableness of the pricing, efficiency in claims management, adequacy of the customer-facing staff in terms of technical knowledge and expertise, relevance of products to the needs and conditions of the customers, ease and extent of appreciation of the terms and conditions of the products before contracting, convenience a reliability, simplicity of the service and more.
Key recommendations
The survey calls for rethinking claims payment not just as a contractual obligation but rather as a business growth and sustainability strategy.
It also calls for coordinating expectations and making sure that customers understand their policy and that the amount of money customers receive must accurately reflect their loss.
“If the amount that they are awarded is too low, they aren’t going to walk away satisfied, even if the process was quick and smooth,” reads the survey.
It also says insurers must be deliberate about dialogue with customers, and strive to create convenience for customers; digitize value chains to ensure timely service and communication but do not ignore human touch.
The survey also urges insurers to provide monthly and annual statements to life insurance policyholders; develop and provide legitimate incentives for clients who have policies and do not make any claim during the policy term; train customer-facing personnel in areas of customer relationship management before rolling out; sensitise the policyholders about their benefits, rights, and obligations before contracting and consider short-term policies that cover periods shorter than five years to cater for individuals who are working on short terms contracts.
The other recommendations have to do with streamlining complaints and customer care desk to ensure policyholders’ complaints are handled expeditiously; and effective regulatory action.
The survey reads in part that there is a very high policyholder appetite for better service and that whereas the popular law of demand in economics proves that demand for a product rises with a decrease in prices and vice versa, providing a great customer experience has become even more important for a business to be successful than price and product.
“In order to increase insurance uptake, the quality of services provided in areas of customer care, communication channels, claims payment and complaints management must improve,” reads the survey.
“The task ahead is huge; the journey is long – it begins with each one of us. Remember we cannot finish unless we start with resolve to reach the finishing line,” Kaddunabbi said.
