The Knowledge: The Buy - Schemes offer a means to boostloyalty

Schemes can improve customer retention in a market where churn rates are second only to those ofsupermarkets

Churn rates in the UK general insurance market are second only to supermarkets in the UK serviceindustry, exacerbated by the rise of aggregators and the ease of customer switching.

Some 25% of UK consumers have changed home or motor insurer in the past year and just over one-third plan to do so in the year ahead, according to Chartered Institute of Loss Adjusters' research.

But in comparison with standard lines, niche or scheme business appears to attract greatercustomer retention. For Folkestone-based Independent Insurance Services, retention figures forstandard lines, at 80%, beat the industry average.

For its Insure Green range of scheme products, however, which offer discounts for beingenvironmentally conscious, retention rates leap to 96%.

"It's a case of offering enhanced benefits to the consumer," says proprietor Ray Johnson. "We givepolicy discounts, just like everyone else, but we're giving something back to the community and theenvironment. People like that."

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The Ecology Business Society also promotes Insure Green to its members. Affinity or groupinsurance schemes can provoke higher levels of loyalty, particularly for recognised brands ormembership groups.

By their nature, schemes are tailored to a particular niche, often one in which they can add value.

"If you've got through the underwriting stage you will have a product tailored to that affinity andthat association. If you can then add value with risk management or health and safety - along with adecent price - you will drive retention of the product," Camberford Law managing director DavidOttewill says.

Social interaction

Another way schemes can build loyalty is to create customer communities, such as by sharingcontent. While insurers have lagged behind other financial services in social media use, it is starting

to take off in schemes.

Broker Adrian Flux has seen follower numbers for its main brand Twitter accounts growsubstantially over the past year. Spokesman Matt Ware says the aim is to engage rather than sell.

"The accounts are aimed at engaging with our customers, or (mostly) car enthusiasts in general, byposting relevant content," he says.

"They aim to give people a taste of Flux, as a specialist broker, being genuinely interested incars/motorbikes, etc, rather than churning out computer-generated quotes."

With interest rates steadfastly refusing to rise, investors are searching elsewhere for opportunitiesto invest their savings. One popular strategy is the buy-to-let market, you or if you have the fundsavailable you buy a property and then get an income from the rent. With property prices still rising,it's a technique offering a degree of security whilst offering good returns on your investment. Sadly,you need to be aware of potential problems. The following link offers answers to questions such asVan Insurance Comparison.

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