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“Sustainable”: When the customer and the insurer mean something else

11/25/2020 – Sustainability can be understood to mean different things. According to a new survey, that seems to be particularly true when it comes to insurance. While providers tend to focus on green systems, when it comes to sustainability and insurance, customers tend to think of security and the long term. Basically, however, only very few see the two terms as a pair.

“Sustainability” is a term that is now widely used. In the insurance industry, too, there has been increasing talk of the abbreviation “ESG” for some time, which refers to the consideration of the criteria of environment, social and corporate governance.

Climate protection, separation from the coal business, green systems, investments in renewable energies, non-investments in the armaments sector – companies then often focus on aspects like these.

Sustainability of insurance from the customer’s point of view

As the Financial Marketing Association (FMVÖ) and Telemark Marketing Having carried out the “Recommender” survey (VersicherungsJournal 27.5.2020) at the beginning of the year, they were also interested in how customers rate the “sustainability of insurance”.

On the one hand, the vast majority of those surveyed named sustainability and responsible behavior as important criteria for choosing the institute. The majority perceive their insurer as acting more or more sustainably (VersicherungsJournal May 28, 2020).

“Sustainability” is rarely associated with insurance

Robert Sobotka,
Managing Director of
Telemark Marketing
(Image: Telemark Marketing)

On the other hand, it was also noticeable “that most respondents associate little or nothing with the term ‘sustainability’ in connection with financial institutions,” says market researcher Robert Sobotka, Managing Director of Telemark Marketing.

This has now prompted him to research what customers actually mean by sustainability, in an Austria-wide survey of 200 people from November 9th to 11th.

First of all, you should answer the following question spontaneously – that is, without any given answer options: What does “sustainability” mean for you in connection with insurance? “

People think more about food or traffic

The result: “78 percent of the respondents could not make a statement spontaneously and answered this question with ‘don’t know’ or could not give a comparatively meaningful answer to this open question”, reports Sobotka.

He interprets the result as follows: The term “sustainability” is “very present in our heads”, but it is obviously associated with food, energy, the transport industry and the like.

The connection to the financial sector is obviously missing. “Only two percent of insurance companies were assigned to the topic of ‘sustainable investment’.” At four percent, this figure is hardly greater for banks.

What does sustainability mean for you in connection with insurance?

meaning

%

meaning

%

security

4

Life insurance

2

reliability

4

Sustainable investment

2

trust

4

Information

1

Good yield

3

Don’t know / no assoc.

78

Longevity

2

total

100

Insurers and customers don’t always mean the same thing

In the following, the question was supported with six common characteristics – environmentally conscious, social, long-term / permanent, safe / stable, resource-saving, natural.

The result shows that sustainability is associated differently in the financial sector than in our general usage, explains Sobotka.

While “sustainability” stands for “environmentally conscious” and “resource-saving” in general, one thinks more of “safe / stable” and “long-term / permanent” in connection with insurance.

So it seems that “sustainability” has a different meaning in the financial sector.

Importance of sustainability, in general and in connection with insurance (data: Telemark Marketing, graphic: Lampert)

A topic that needs to be explained

Sobotka draws the conclusion: “What insurance companies understand by sustainability has obviously not yet reached customers.” Due to its importance in the public discussion, the topic is nevertheless important.

Institutes that want to take up this topic and position themselves with it, however, have to be aware that it requires a great deal of explanation.

Because: “Before I can convince the customer of the sustainability of my company, I first have to explain what sustainability in insurance actually means and how important this is in the financial sector too.”

That, says Sobotka, is certainly a challenge to – advertising – communication, “but probably a long-term – or better: sustainable – strategy”.

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