Crisis Communications in Catastrophe Insurance: Navigating the Storm

During a crisis, emotions run high.

Fear, worry, and anxiety are commonplace for policyholders concerned about their properties and well-being.

As a potential catastrophic event is about to unfold, your policyholders need clarity on several fronts:

• What is about to happen (The calm before the storm)
• What has happened (post-event)
• What might happen (forecast next steps)
• What is (or is not) happening (status)
• How will they be guided through the crisis to closure (reassurance)

The stakes are elevated for both policyholders and insurers, making clear communication even more urgent. Communication by itself is not enough! A lack of clear communication only heightens confusion and anxiety, exacerbating an already difficult situation. 

To reduce confusion, hyper-personalization is crucial in crisis communication. By tailoring messages to address individual needs and circumstances, insurers can provide reassurance and support to their policyholders. This personalized approach conveys that they are seen and supported.

Strategies for Hyper-Personalized Communication

What Is About to Happen - Before The Storm (Event)

For some events, particularly hurricanes, there may be days or even a week to communicate with policyholders. Hurricane forecasting has advanced significantly, allowing insurers to filter who needs to be contacted and when. Communication should target those expected to be affected by the storm, broadly encompassing anyone with anxiety about the storm and what to do. This includes anyone in the "Cone of Uncertainty."

Initially, the target audience affected by the storm may be extensive, but as the storm's path becomes clearer, communication can be refined and focused. As the target audience shifts, it's crucial to provide reassurance to those no longer in immediate danger. A message acknowledging they are currently out of the cone of uncertainty, but that the situation could change, can offer relief while demonstrating attentiveness. 

What Has Happened - Post-Event

After the storm, communication should focus on policyholders' status and well-being. There are two groups of policyholders here, those affected and those presumed unaffected.  

In both cases, they need to know how to contact their insurer and that the insurer will continue to try to reach them until the damage and their needs are assessed. Even for those that are presumed unaffected, that presumption has gotten many insurers into bad-faith situations. Ideally, insurers won’t presume, but will allow the space for our policyholders to inform us.

What Might Happen

Uncertainty is inherent in insurance. Policyholders may wonder if their claim will be accepted, if they'll be fully compensated, how long the process will take, and if the claims support will be helpful. Proactive communication addressing these concerns can alleviate anxiety.

What Is (or Is Not) Happening

This is a status check. Policyholders need to know the status of their claim. If no progress has been made, the insurer should explain why, outline the next steps, and offer reassurance.

How They Will Be Guided Through the Crisis to Closure

Insurers should assure claimants that support is available 24/7. Providing resources to help them understand the claims and repair process can also be beneficial. If policyholders have been displaced, information about loss-of-use coverage should be included.

Key Components of Hyper-Personalized Communication

Each stage of the crisis communication process should include the following:

• Acknowledging the Policyholder’s Property and Coverage
  Personalizing communication starts with acknowledging the specifics of the insured property, beyond just the address. Discussing the specifics of their coverage demonstrates that the insurer understands their unique situation and fosters trust.

• Acknowledging Current Policy/Claim Status
  The current policy status, including any outstanding payments, should be acknowledged. If the crisis has impacted their ability to pay, clear guidance should be provided. The status of their claim should also be addressed promptly to reduce stress and confusion.

• Providing Multiple Channels for Connection
  During a crisis, accessibility to communication is vital. Policyholders should have multiple options for contacting their insurer, such as text, phone, mail, email, and online portals. This accessibility reinforces a sense of support and reliability.

• Bringing Services to the Policyholder
  When standard communication channels are disrupted, proactive steps like sending a team to the affected area and setting up an "insurance village" can be invaluable. This allows policyholders to file claims, check their status, and receive immediate assistance, streamlining the recovery process.
• Over-Communication
  In a crisis, there's no such thing as too much information as long as it’s clear, unambiguous, and helpful.
  
  Overcommunication keeps policyholders informed and helps manage expectations. Any limitations to service should be communicated transparently, along with the steps being taken to address them.

The Bottom Line

Effective crisis communication in property insurance goes beyond simply providing information; it's about delivering it in a way that resonates with each individual. By understanding their specific needs, acknowledging their situation, providing multiple communication channels, offering on-site services, and maintaining consistent communication, insurers can significantly enhance their crisis management strategies. This approach strengthens the insurer-policyholder relationship, fosters loyalty, and can even reduce the likelihood of clients seeking external representation during the claims process. The financial benefits of long-term customer loyalty and a reduction in represented claims are substantial and cannot be understated.