This week I did get a mail from my car insurance. There was a letter that due to some market conditions, they had to increase the price. I can understand that. So, then I did check the price increase and I couldn’t believe it, as the increase was 56%!!
My thought was that this had to be a mistake, so, I did call the insurance. The customer service lady was already glad that I didn’t shout at her, clearly I was not the only one picking up the phone! She had to check this with another department and said she would call me back. She did call me back and sais that indeed there was a mistake, the price increase should have been 50% as that was the maximum increase allowed according to their T&C’s. Again I was flabbergasted, because I have been driving without any damages for at least 22 years! I did tell her that now I was forced to check out other offers in the market and she said that she could understand this. End of call!
I did check out several options and I did find another assurance, which was even 39% cheaper than my original insurance, before the price increase! That makes me happy again. But obviously not the original insurer.
It is clear that bookkeepers have had a look at the numbers and they decided to increase the prices to cover the costs. Clearly they had no feeling at all for customer behavior (and even their own behavior). I guess that 95% of their customers, who have the same experience as I had, will leave. This means they will end up with just a very few customers paying the higher price. They will loose a lot of business! While this price increase is clearly absurd, they also could have looked at the Lifetime Value of their customers. I did pay my insurance to them for more than 10 years without any damage, so this revenue went straight to the bottom-line. If they would have looked at this then they already could see that any price increase would have a negative effect.
Who is more important, the bookkeepers or the customers!
PS. This is a large insurance company from the largest mobility organization in the country!
Enthusiasm drives Excellence!