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The 'Predictably Irrational' Claimant

The claim experience can either make or break a customer's relationship with an insurer. Insurers must understand how people will react to loss scenarios in order to customize services that will ensure customer satisfaction.

By Punita Gandhi, Anand S. Rao, Jamie Yoder | Updated on August 29, 2010

In his book “Predictably Irrational,” Behavioral Economist Dan Ariely reveals the curious interconnectedness between two forces. First, that people’s choices are influenced by their emotional or “hot” states, and are often irrational. Second, that this irrationality is oddly systemic, and forms patterns — suggesting that, if studied closely over an extended period of time, they could be predicted. In the insurance world, events that trigger a claim are examples of hot emotional states for a claimant — meaning ones in which they may be predisposed to act irrationally. Combine this interesting insight with the growing belief that the nature of the claim experience can either make or break a customer’s relationship with an insurer, and all of a sudden, it seems to makes sense to preemptively understand how people react to a claim incident, and then get ahead of them to service them accordingly so that they are not just satisfied, but pleased every step of the way.

The Customer Satisfaction/Loyalty Connection

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