Insights / Data + Intelligence

PUBLISHED: Sep 20, 2021 5 min read

How Data Can Maximize an Insurance Cross-Selling Strategy

Identifying and targeting for additional products and services.

It can cost five times more to attract new account holders than it does to retain an existing one. Keeping your policyholders happy and in-house is more important than ever before — especially when it comes to dollars and cents. In fact, the probability of prospecting and selling to a new potential policyholder ranks between a paltry 5-20 percent, but the probability jumps considerably when cross-selling[amsive_tooltip term=”cross-selling”] enters the mix to current policyholders; insurers can count on 60-70 percent of in-house customers to be interested and sign up for new products or services. That sounds great, but there is a data science component behind this success.

A successful cross-sell program has to be part of an insurer’s marketing plan of attack, including aggressive growth and retention goals that are communicated, tracked and held accountable across the organization. But the missing part of the equation for insurers is how to capture the right opportunities. If they truly want to reap the cross-selling benefits in today’s competitive environment, marketers must go beyond the basic techniques they’ve relied on in the past and embrace data.

Why Should Insurers Care About Cross-Selling?

A critical first step to expanding cross-sell opportunities is to do exactly that — take things from step one. Only 3 percent of consumers think salespeople and marketers are trustworthy, so establishing trust and engagement with appropriate onboarding and education directed to every new customer is essential. 

People may be unaware of additional policies and benefits, and some may not know what kind of coverage they need. Adopting an advisory strategy that positions additional products and services to help policyholders means customers will actually want additional product offerings. But without data, insurers will be playing a costly guessing game.

How Can Insurers Put Data Science Into Action?

By successfully harnessing data to identify policyholder habits and propensities, insurers can strategize on proactive ways to engage those holders through cross-sell opportunities. Modern customer intelligence and data science allow insurers to go above and beyond traditional approaches focusing on product ownership and demographics[amsive_tooltip term=”demographics”], but also establish a more holistic analysis to account for customer attitudes, perceptions, and behavior. An approach that uses sophisticated, analytics-driven cross-sell initiatives at the forefront of customer preservation and cross-sell efforts ultimately breeds policyholder lifetime value, brand loyalty, and retention for years to come. 

But a successful, data-backed cross-sell program must develop strategies to determine the following three questions: who is most likely to respond, when they are most likely to respond, and what they are most likely to respond to?

By successfully harnessing data to identify policyholder habits and propensities, insurers can strategize on proactive ways to engage those holders through cross-sell opportunities.

1. Pinpoint the Right Policyholders — Segment and Identify Vulnerabilities

  • Leveraging expanded data insights about important events that impact customers will enable a more compelling customer experience – resulting in greater revenue, retention, loyalty, and share of wallet. Incorporating so-called event triggers — around online and offline actions such as life cycle shifts and new transactional behavior, including searching for quotes — establishes the exact right time when eager customers have the greatest need for additional products and services. 

2. Crunch the Numbers — Catch Policyholders Who May Defect

  • Using data can identify policyholders that enter the market and begin shopping to determine offer qualifications or relevant counter-offers to maintain the customer. Such data takeaways can show that demographics like empty-nesters, members who are planning on having their first child, people that have gone through a marital status change, or a couple that is actively looking to buy a new home can be enhanced with next-most-likely-product models to deliver them what they need based squarely on those personalized consumer shifts.

3. Create the Best Cross-Sell Messaging — Act Quickly with Personalization

  • The final piece of the puzzle is to focus on the communication and appropriate channels for segmentation targets based on the needs established in a given customer journey. The power to act swiftly and intercept shopping customers by targeting them immediately with a personalized, relevant offer and cross-selling additional policies means protecting the business long-term.

Cross-sell is at the core of building lasting relationships and growing policyholder profitability. By using data to determine each customer’s next-most-likely-product, event triggers to time offers, and audience segmentation[amsive_tooltip term=”audience segmentation”] to match content creative channels with customer needs, any insurance marketer can greatly expand cross-sell relationships. The deeper the relationship, the less likely that policyholders will leave; the better the data, the greater the lifetime policyholder retention.