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In June 2020, as South Africa hit its first Covid-19 peak, over 220 new adverts for insurance were flighted in South Africa. In the background, companies were fighting insurance companies for business interruption claims. GLENDA NEVILL takes a look at the tough environment insurers are operating in, and how they’re marketing their way through the global pandemic.

In the first week of 2021, one of South Africa’s largest insurers finally committed to paying clients’ business interruption claims, particularly for those holding hospitality and leisure policies. Admittedly, it took a few adverse court rulings before it caved to the pressure and lost all hope of recovering its reputation.

“It is a major victory… Some would say it’s too little too late because it’s been months now of tarnished reputations and heels being dug in…” said consumer journalist, Wendy Knowler, on 702.

And the fight will continue because the company only committed to three months in full and final settlement. We can expect more unhappiness in 2021.

It wasn’t the only insurance company, either at home or abroad, to resist honouring the claims. Other big South African firms began paying out after an unequivocal and precedent-setting Supreme Court of Appeal ruling in December 2020. As Ryan Woolley, CEO of Insurance Claims Africa, told Biznews, “Eight High Court judges and five SCA judges have unambiguously found business interruption claims to be legitimate and ordered insurers to pay out claims”.

The companies’ position, in a nutshell, was that lockdown led to business interruption, and not the pandemic itself. This held no water with business clients that had religiously forked out their monthly payments in the belief their companies would be protected in the face of disaster. Social media was awash in searing diatribes against the insurer. “You can’t bullsh*t your way out of doing what you’re supposed to do with empty slogans…” said one.

The pandemic hit consumers hard too. As Hollard Insurance’s chief marketing officer, Heidi Brauer, says, “Now comes the time when consumers have lost jobs, had travel cancelled, have car or home instalments they can’t pay, or have lost somebody. And their insurance comes into play. It’s a time for the insurance industry to show its best face.”

Insurance is already a ‘grudge’ buy and with a global pandemic raging and the economy tanking – a “perfect storm”, as Brauer calls it – insurers had to decide whether to step up their marketing efforts, or hide until the pandemic recedes.

Insurers continued marketing in 2020

With reputations and profits on the line, most insurers continued marketing. In fact, brand intelligence outfit Ornico reported in August that in June 2020, a total of 228 new insurance industry commercials were flighted, mainly across television and radio channels. Clientele and OUTsurance were the biggest spenders, followed by Old Mutual, Momentum, Hippo, Dotsure, King Price, Discovery and iWyze.

“We had conversations about ‘going out’ of the market for a period and not go on tooting horns. But that’s why I stress consistency, because brands need to be there through thick and thin, no matter what. We need to be there with some sensitivity. There’s so much inertia and friction to overcome if you pull your brand out of the market then try to get back in,” says Brauer.

“We chose to stay in the market in an appropriate, sensitive and caring way. We were very lucky as we were already on the tail end of a campaign we’ve been running for a year, which was all about South Africans saying ‘hello’ to each other. It was all about inclusivity and saying ‘hello’ so we were able to continue in the same way and did the lovely ‘hello’ from behind the mask in 12 official languages (12th being sign language) and try to keep people smiling because that’s what our brand is. Our brand is always a smile, a twinkle in the eye, even when times are tough.”

Not surprisingly, much of the marketing messaging centred on the human connection, with a caring and kind attitude. We are listening. We are there for you.

“There was a Reel [on Instagram] going around showing all the brands in various industries looking the same, showing love and hearts and signs outside windows. We were remarkably uncreative and leapt on similar bandwagons,” says Brauer. “I think that’s a zeitgeist thing, which happens anyway when you’re all being propelled by the same circumstances. When you all have the same business objectives, it’s likely that your creative output is going to be the same. Your brand needs to help you differentiate. For us, you don’t want to jump on some bandwagon and look fake as people see right through you, because that’s not what your brand normally looks like.”

More than marketing

Insurance marketing through the pandemic had to go beyond just advertising to be relevant, says Charlotte Nsubuga-Mukasa, head of consumer brand marketing at Momentum Financial Services. “Marketers needed to create uplifting emotive narratives that celebrated the resilience of the South African people and demonstrated societal relevance at the same time,” she says.

“A brand’s reputation is linked to how quickly and how simply they communicate their response or resolve any query. The care that is demonstrated in these interactions becomes a vital touch point for the brand to ensure the integrity of their brand promise. A client that is heard has a high probability of remaining in a place of engagement and trust with their insurer, even in cases where the outcomes are not fully what was expected through the claims process,” she adds.

“In the case of Momentum, we contributed to the Solidarity Fund to address new needs such as providing health equipment for essential workers in our hospitals. And we made sure to adapt by providing product payment relief and reduced or deferred payment options for clients who were going through a hard time.”

While the role of insurers in society is evolving, the core business remains grounded on people and good financial advice, adds Nsubuga-Mukasa. “Product solutions now need to be more innovative and agile than ever before. But it has always been an industry that is known to transform good ideas into comprehensive product solutions that are relevant for the society it serves.

“Insurers are making a societal impact, but as marketers, we need to make sure that our creative moments fit. An example of a fit for purpose campaign during lockdown level 5 was the case of KFC. They got good press for changing their finger linking creative to hygiene and the washing of hands. Momentum became one of the first brands to provide free 24/7 medical advice services to all South Africans through the USSD Hello Doctor solution.”

Brauer agrees the job of a brand is to make sure the promises it makes are kept. “So you talk about tone and caring and listening and insurers are doing much more of that, but the trick is to deliver on those promises and be consistent. What people want from brands –whether it’s coffee or sparkling water or hand lotion – is consistency. As a marketer, what I have witnessed is some strength and some weakness when it comes to consistency. The problem is consumers will see through that if you can’t keep it up.”

Nsubuga-Mukasa says the insurance industry has experienced clients switching to more affordable brands or categories, selecting more affordable packages, sizes or solutions, all the way to rationing or cancelling the quantity or frequency of their purchase of goods and services.

“Marketers in the insurance industry need to ensure that their consumer marketing messages remind their clients and consumers to be unwavering in protecting the solutions that they have put in place to drive their long term ambitions and financial goals,” she advises. “With the support of a knowledgeable and trusted financial adviser, a client’s success may lie in their persistence in maintaining their benefits during a tumultuous time.”

A general lack of knowledge

Insurance marketers continue to battle consumers’ general lack of knowledge of how insurance works. This is exacerbated by it being a “low touch” product. “You buy a policy, and may not hear again from the insurer until you have a claim or until it’s time for the annual increase or renewal. So not only is it a grudge purchase, and complicated, but it’s also low touch…similar to banking, but worse,” says Brauer. “And insurers don’t make it easier to understand either. It’s all smoke and mirrors. We’re all bad at it.”

“Marketers are no longer paying lip service to campaigns that are not based on human truths, says Nsubuga-Mukasa. “Momentum based its #SuccessIsAScience campaign on the fact that clients and consumers find financial terminology complex and intimidating ” she says. “Consumers are hungry for (unambiguous) information to help them on their journey to success. Marketers need to tap into behavioural insights and deliver the same savings, insurance and investment messages in new ways to enable ordinary South Africans to successfully navigate and respond to a crisis in future.”

 

 

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