By Vipul Vyas, Senior Vice President, Strategic Consulting
What if changing a few words or using the right emotion in an IVR prompt could increase payments and prevent delinquencies?
That’s exactly what happened for one of the largest US insurance companies. Small changes to the language in its IVR prompt convinced 10% more customers to “Press 1” to begin the process of making a payment. The prompt ultimately increased payments by 16% against the control message developed by the insurer. The end result was reduced delinquencies and increased customer retention that produced millions in value.
The challenge facing insurance companies and consumers
For any given insurer or financial services company, tens of thousands of customers may miss a payment in any given month, which increases service costs and decreases solvency. If an insurer ultimately has to cancel a policy for nonpayment, it then takes a hit to its retention rates, with no guarantee it can win that customer back.
Small changes to the insurer’s IVR prompt increased payments by 16% and generated millions in value.
In the current environment, consumers experiencing financial hardship are making difficult choices about who to pay first. When insurers intervene early with policyholders that miss a payment, they can drive stronger engagement to get in front of policy lapses.
What one insurer did differently
The insurer launched an outbound IVR campaign for policyholders who had missed a payment. The call let policyholders know their coverage was at risk of cancellation and prompted them with clear instructions and a more effective call to action (CTA) to initiate an automatic payment and get up to date. The Persado IVR prompt increased payments by 16% above the control prompt crafted by the insurer.
Over thirty thousand policyholders received these calls each month. Multiple machine learning and AI-powered language experiments conveyed different emotions to help the insurer find the most effective approach for motivating customer action. It turned out that Intimacy was the highest performing emotion over Curiosity, and changing a few words in the CTA contributed 54% to the overall performance improvement. (Note: Recent 2020 language analysis uncovered that Intimacy is one of the most engaging emotions during the COVID-19 pandemic).
Intimacy was the highest performing emotion over Curiosity. Changing a few words in the CTA contributed 54% to the overall performance improvement.
Language insights increase completed payments
Persado’s experiments highlighted keywords that made the call more intimate—and therefore more engaging for the customer. “We’d love to see you keep your policy” gave the message a personal touch. Changing the call to action from a verbal prompt (“Say 1”) to a physical one (“Press 1”) motivated more customers to press that button. Compared to the control, those small changes convinced 10% more customers to go to the next step of making a payment.
A personal status check (“You’re almost done, we promise”) and that physical action to confirm the payment (“Press 1”) ultimately nudged more policyholders to get themselves back in the black.
The coronavirus pandemic is putting more policyholders under financial pressure from income loss. Missed premium payments are likely to increase to levels not seen since 2008. Leading insurers are already showing customers they care with automatic discounts, late-payment forgiveness, and other financial hardship programs. Persado’s AI platform can help find the right words to complement these tactics and also use cases to maximize payments in a customer-centric and empathetic way that builds brand loyalty for the long term.