Many Australians shopped for new health insurance before 1 April when rates for most of us increased. When I received a notification from my insurer of my rate increase, I immediately called iSelect to seek a less expensive plan. I had bought my existing plan via iSelect and decided to start with this consolidator to find an alternative plan. The call was a success.
iSelect informed me of a less expensive plan, plus a plan with more coverage. It was a 20-minute call, which saved me ~$40 a month and brought me greater benefits.
About three weeks later I received a call from my outgoing insurer asking me why I was “leaving” their plan. When I explained it was due to cost, the caller said “why didn’t you give us a chance to find you a cheaper plan and alternative benefits?” I suggested customer retention was the job of the insurer, not the customer. I also suggested if there were alternate plans, which were cheaper and more beneficial, the insurer should send those alternatives out to the customer rather than simply send a rate increase letter. The caller suggested I had good points and ideas.
The call from this insurer suggests to me missed opportunities all around. Additionally, the call offers some lessons to be learned by the non-profit sector and retention of donors. The following are obvious lessons to me:
- Rather than give donors (in my case customers) a reason to “shop around” or go to another charity, work hard to retain the donor.
- Offer donors a menu of choices rather than restrict them to one option.
- The donor (customer) is likely to not call you to seek alternative ways to stick with you.
- Show donor appreciation before it is too late. Retaining a donor is less costly than acquiring a new donor.
Recognising donor and brand loyalty is critical. Once the donor is gone, it is often very difficult to gain the donor back.