The trust deficit
A paradox lies at the heart of the insurance industry. An insurance policy is a promise (or set of promises) to pay up to a certain sum in a prescribed set of circumstances. It will have no perceived value if the policyholder does not trust the insurer to keep its promises. And yet insurers enjoy lower levels of public trust than most organizations.
A high-level view of the problem is shown in the “trust barometer” surveys that public affairs company Edelman has published for the past 23 years. Reflecting public perceptions in 27 countries, the 2023 survey found that financial services companies ranked second from last in terms of how much they were trusted to “do what is right”. Only social media companies fared worse.
Trust in Industry Sectors, 2023
0 10 20 30 40 50 60 70 80
76
71 71 70 69
67 67 66 65 65 65
63 63 61
59 59
44
Source: 2023 Edelman Trust Barometer
Rapidly rising premium rates can also erode trust. The most recent survey of commercial insurance brokers conducted by the Council of Insurance Agents & Brokers (CIAB) in the third quarter of 2023 found that 70% of respondents “described hearing some level of rate fatigue from their
clients” and “nearly half said their clients felt burdened by carrier requests for information.” The survey also found that more than 40% of brokers “said their clients felt some level of mistrust towards the industry.”
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