Cross-selling is an effective way for insurance providers to generate more business and increase revenues without incurring lead generation and customer acquisition expenses. This is essentially a strategy to sell additional insurance products to an existing customer, keeping their needs and preferences in mind. It also helps strengthen your customer relationship, demonstrating that you stay updated on their changing insurance needs. Doing so can also lead to better customer satisfaction and retention.
Acquiring new customers can be 3x-5x more expensive than cross-selling to existing clients. Cross-selling insurance can lead to potential cost savings of up to 60%-70%.
How Cross-Selling Insurance in India Works
Cross-selling strategies involve insurance companies offering additional policies to customers who already have a policy. Insurance agents can suggest related or complementary products to customers. For example, an agent might consider cross-selling car insurance to a customer who has home insurance. Since the customer is already familiar with the brand and its policies, it is easier to target them with new offerings. Such strategies reduce costs associated with customer acquisition, allowing insurers to better use their marketing budget on growth areas, such as targetting new regions.
Analytics plays a key role in helping insurers identify products that will best suit existing customers’ needs. However, the key to cross-selling success lies in doing it the right way, without appearing too aggressive, pushing customers to purchase additional policies or riders.
Cross-Selling Strategies in Insurance
To succeed in cross-selling insurance products in India, the key is to analyse customer needs and match them to the appropriate complementary product. You will need to develop a sales pitch personalised for the specific customer and the complementary product. Here’s a look at strategies that work well for insurance.
Understand Customer Needs
You cannot succeed at cross-selling unless you know which policies will best suit a customer's needs. Many only buy insurance when it is absolutely mandatory, like car insurance, which is required by law. So, learn what types of policies will be necessities for such customers.
Customer Segmentation
Use AI and analytics to identify customer behaviours and segment them according to age, location, income, assets (home/car), family needs and insurance types. This will help you identify cross-selling opportunities for insurance products they do not as yet own.
Average open rate for email marketing – 32.55%.
Average ROI of email marketing – 36x.
Automate Outreach Campaigns
Customer segmentation also helps with automated campaigns. For example, email campaigns have proven effective in cross-selling insurance in India. Make sure you personalise the email content to drive higher open rates.
Share Facts and Stats
Customers need to be made aware of all your insurance products. Such information should be easily accessible for them to peruse at their convenience. Customers should also be informed regarding special offers, discounts on bundled insurance policies, case studies, statistics about claims, etc. For example, inform them about how riders can enhance coverage without the need to purchase additional policies.
How Insurtech Powers the Cross-Selling of Insurance Products
Insurtech facilitates insurance cross-selling by leveraging technology to gather detailed customer data, enabling personalised product recommendations based on individual needs. Leveraging insurtech, insurers can offer seamless digital platforms to easily present additional insurance options to existing customers. All this ultimately increases opportunities to cross-sell related insurance products. Here’s a look at how Insurtech powers insurance cross-selling.
Data Analytics
Analysing customer data from various sources offers insights into customer demographics, lifestyle and existing insurance coverage gaps. This helps identify potential cross-selling opportunities without adding to the workload for human agents. Data-driven insights can facilitate strategies for targetted cross-selling, ensuring that the most relevant options are offered to customers at the right time.
Personalising Recommendations
Using AI and machine learning algorithms, insurtech platforms can help generate tailored insurance product suggestions based on a customer’s specific profile, making cross-selling more relevant and effective. For example, if a customer has home insurance, a personalised cross-selling recommendation could be to add flood insurance, based on their location. Personalisation is also a great way to improve customer retention.
Streamlining Communication
Mobile apps and online portals provide a convenient platform to display cross-selling options directly to customers while they are managing their existing policies. Such digital platforms, powered by insurtech, facilitate personalised communications, allowing insurers to keep customers informed of the latest products, offers and tips to save money by bundling policies.
Interactive Tools for Decision-Making
Insurtech platforms with built-in interactive tools, such as premium calculators, comparison tools, etc., ease the process of decision-making for the customer. With support from a virtual assistant, the customer can explore means of expanding coverage at their own convenience, making cross-selling a cost- and resource-effective process.
Automated Marketing Campaigns
Insurtech enables targeted email and push notifications to be sent to customers based on their data. In fact, the entire process of identifying relevant cross-selling opportunities and sending out notifications or emails at the right time can be automated. Reaching out to a customer at the right time with the right product increases the chances of cross-selling success.
Maximise Insurance Cross-Selling Success with Insurtech
Cross-selling is an effective way for insurance providers to increase both revenue and customer engagement, while reducing costs associated with sales. However, to succeed at cross-selling, you need the support of the right technology platform and tools. This is where partnering with an experienced and skilled insurtech company can prove invaluable. Choose a white-label platform that allows you to offer consistent branding and messaging across communication and distribution channels. Make sure the platform is armed with powerful analytics and reporting tools to ease decision-making and compliance.
Insurance companies that leverage Insurtech can increase revenue by up to 20% while reducing customer churn by up to 15%.
Frequently Asked Questions (FAQ)
What are cross-selling products in insurance?
These are additional insurance plans offered to a customer who has already bought a primary policy. For example, someone buying health insurance may also be offered a personal accident cover. It’s about offering meaningful add-ons that fit the customer’s life stage and risks.What is the primary purpose of cross-selling in insurance?
It’s to make sure the customer is better protected, not just better sold to. A well-designed cross-sell adds value, covers gaps, and makes the policyholder feel genuinely looked after.What is cross-selling in bancassurance?
In bancassurance, banks offer insurance products alongside their core banking services. So while helping you open a savings account, they might also suggest a term plan or health insurance based on your needs. It's about convenience and context.What's the difference between upsell and cross-sell?
Upselling is when you’re offered a more premium version of the same product, like moving from a ₹10L to ₹25L term cover. Cross-selling is offering a separate but complementary product, like pairing a term plan with accidental death insurance.
