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Insurance Should be Painful

(By Colangelo)
Insurance Should Be Painful
By Colangelo / April 20, 2018

Most homeowners and auto insurance brands spend a fortune implementing a very familiar formula in order to attract and keep customers. They seek attention through humor or a deeply felt expression of trust, and then follow with an offer on price and a promise of great customer service. Since most brands are following this formula, it must be the best way to conduct business…or is it?

In order to answer this question properly, we need to clarify why people buy insurance, and then we need to check to see if the formula above is the best way of satisfying that reason.

So why do people buy insurance?

While some may argue that beyond legal or contractual reasons people by insurance to fulfill their role as a parent, partner or loved one, or that they must satisfy some sense of self-directed responsibility, the more relevant answer is simply that people buy insurance for protection; and more specifically, protection against the unforeseen or unexpected- things deemed out of their control.

Seeking protection is neither something new nor something exclusive to procuring insurance. Human beings have been seeking protection for things beyond their control for untold millennia, whether it be against illness, harmful weather, or a myriad of other forces that can cause distress.

Accordingly, we have developed rituals that we believe foster protection against harmful forces. Over time, these rituals have become hard-wired into our psyches. Without completing these rituals, our sense of protection remains unfulfilled. For brands offering protection, non-utilization of these rituals creates dissonance and a fractured relationship between the brand and customer. Conversely, incorporating the ritual within one’s brand experience eliminates dissonance and creates attachment.

Affliction

Affliction rituals are utilized when people want to correct a state that has been disordered or disturbed.1 Since virtually all cultures associate misfortune with disorder, affliction rituals have universally been used for healing, purifying and protecting purposes. They are a natural fit for personal care and beauty brands, household products, and many forms of financial services including insurance.

Although there are scores of different affliction rituals, each with its own particular processes, roles and symbols, and sets of meanings, there are four overarching steps that all affliction rituals employ.

  1. Divination. In this phase, a uniquely equipped person with special status “divines” the source of disorder and “prescribes” the actions needed to restore order and strength, or to prevent disorder in the first place.
  2. Purification. The prescribed cleansing action is undertaken to symbolically remove the cause of, or prevent, disorder.
  3. Sanctification. The cleansing is made legitimate and binding through an act that glorifies it. Order is restored.
  4. Consecration. The final act is undertaken to acknowledge the new state of being and order.

It is only through the completion all four phases that order is restored and that healing or protection is finalized. If all steps aren’t enacted, ritual dissonance and emotional frustration occur.

The medical model most of us subscribe to is very good at implementing steps one and two and pretty bad at integrating steps three and four into the healing process. Much of our frustration with the model, as evidenced by continuous and tragic adherence rates, can be sourced to the absence of the last two steps in treatment protocols.

1 Bell, Catherine (1997). Ritual: Perspectives and Dimensions. New York. Oxford University Press.

Ritualization and Insurance

So how do a Gecko, a Discount Double Check, Flo, or even a mumbling Peyton Manning fit into the ritual needs of customers? The short answer is not very well- at least the way they are currently being used.

To be fair, humor is a not a bad tactic to get people over the central contradiction that arises when buying insurance. Expending hard earned resources for something one never hopes to use creates a tremendous amount of ritual dissonance and emotional frustration.

Human beings naturally approach buying things as an exchange ritual, one where they get something tangible in return for their money. When the exchange is for something abstract and there is no symbolic (ritual) substitute for the tangible object, the ritual is broken, people feel disconnected, and the abstract good is devalued.

The importance of ritual completion can be seen in the vast amounts of money that people spend on whole life insurance policies. Even though most financial experts will tell you that whole life is not a good deal compared to buying term and investing the rest, the ritual need of tangible exchange trumps the rational argument for spending on something one will never use. Thus, people pour money into whole life because they see and feel their cash value grow in return for their premiums, even though it might not be the most prudent investment.

So humor in itself does not run contrary to human needs when it comes to buying homeowners or car insurance. The problem is that humor is being implemented within the old marketing model of awareness-offer-loyalty, and this does not solve the ritual dissonance associated with buying homeowners or car insurance.

The natural way for these providers to solve the dissonance and produce attachment is to integrate humor within the four broad steps of affliction rituals highlighted above. Doing this creates a doubly strong effect: it satisfies the hard-wired ritual need for protection as well as exchange, for the affliction ritual symbolically takes the place of the tangible object one expects to receive in return for paying premiums.

As far as humor goes, there is no set-in-stone place to utilize it. Where humor best fits within the affliction ritual is dependent upon what the brand decides to do in the other steps. It’s pretty easy to see how humor might fit in the divination stage and pretty hard to see how it might fit in the sanctification stage, but this doesn’t necessarily mean that humor is best for divination and that it can’t be used for sanctification. It just means one has to think differently and see whole the picture.

The offer too need not disappear. But like humor, needs to find its proper place in a comprehensive marketing effort that encompasses the entire ritual. It is important to remember that the entire ritual doesn’t have to be crammed into a 30-second commercial, a digital landing page, or a training guide for agents. It’s simply that the each customer touchpoint, whether it be communications or product usage, should clearly be felt as satisfying one of the steps and that the entire brand experience should encapsulate the entire affliction ritual process.

Insurance is something people have to buy so there will always be a market for it. The uniform marketing model most brands utilize keeps the playing field level and allows the big spenders to carve out their fair share of the market. It does little, however, to distinguish one brand from another, reduce churn, and produce attachment. That opportunity awaits.

 

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