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Apr 23, 2014

How Social Media is Influencing Insurance Company Practices

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How Social Media is Influencing Insurance Company Practices
Social media and insurance? What’s the connection between the two? - You may ask. Who would follow an insurance company or like their statuses? But it’s not just friends or followers that are attracting major insurance companies with these websites and impacting their business practices. Dig a little deeper and you’ll find that insurers have hugely benefited from integrating the use of social media in their practices. Reason: Access to these data-rich websites makes it simpler for them to market their services and weigh the risks of prospective clients. The potential value of social media to insurers is quite high, says the National Association of Insurance Commissioners (NAIC).
Social media like Facebook, Twitter and LinkedIn, which were virtually unheard of a decade ago, have taken the web by storm and tech-savvy businesses were not far behind to stamp their presence on these websites, insurance companies included. So how exactly do businesses and in this case, insurance companies, harness social media to their benefit?

Hitting the ‘Like’ button: Why social media platforms have caught the attention of insurers

Let’s begin with the obvious: A potential client database. If an insurer is looking for prospective customers, all they have to do is mine data off these websites and voilà, they can receive reams of information that’s ‘public’, although not all information collected is credible. Next time you post a picture on Facebook, an insurer could be viewing it to build your profile for future use! Collecting information through social networking websites can save insurers from spending money in costly laboratory procedures to access an individual’s health, reports The Wall Street Journal.

Generating data on prospective customers is not the only reason why so many insurers log on to these sites. Keeping a satisfied customer base is another reason. Through word-of-mouth promotions, increased visibility, satisfactory customer service and developing a personal relationship with clients, insurance companies reach out using social media, says a post on SQ Modern Media. This may be true with other businesses as well, but insurers do make sure they are in constant touch with their customers to retain them.

On the radar is also the marketing and advertising of insurance-related products and services. Developing creative strategies to appeal to myriad demographics have meant that a wider audience receives information related to new offers, promotions, discounts and the like. Moreover, an insurer need not send out multiple updates - a single post is all that’s needed. Team up with popular bloggers and you’ve hit the jackpot! While many insurers go out of their way to be ‘liked’, Fox Business reports that there are insurance companies who are taking to social media platforms while advertising a good cause. The Hartford Business Insurance utilizes social networking platforms to support the U.S. Paralympic team and even raises funds for the athletes through every ‘like’. This insurance company now has over 100,000 Facebook fans and counting!

Social media is also impacting in-house practices of many insurance companies. Recruitment drives are now carried out through social media and profiles of prospective employees can be viewed. Companies like Aon carry out campus hiring through Facebook, says The Undercover Recruiter blog. Just like potential customers, new employees are scanned before being inducted into the company.

The Future Of Insurance Marketing: Why Social Media Is A Gold Mine

In this infographic from leadsift, you'll see data gathered from more than 3.7 million tweets and a series of research studies, that insurance companies can leverage to be more effective and efficient in their marketing and sales efforts.
The Future Of Insurance Marketing: Why Social Media Is A Gold Mine

The soaring popularity of social media platforms among insurers is only set to grow in the future as workplaces increasingly become mobile, online communication builds up and more information becomes public. But as with all activities, potential risks are present-just as quickly as information is disseminated, a company’s brand can be tarnished at an equal pace on online social platforms and often there’s no turning back, an Accenture report observes. Declining interest of people towards social networking, and a large pool of private data can also be deterrents for insurers over time, but such a scenario seems eons away. For now, insurers have made sure they master their way through the maze that is social media.

Article contributed by Jennifer Winget. Top image credit: 123rf.com

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