The Luxembourg insurance industry, often shackled by tradition, is on the precipice of change. It is now perfectly positioned to capitalize on an energized customer-base seeking greater affinity and new services.

Recharging Affinity 

This is the key finding of the 2019 Luxembourg Insurance Market Pulse Survey (MPS), the first of its kind in the country. Jointly developed by Accenture and Bâloise Luxembourg, it surveyed more than 1000 respondents on 25 questions across six categories, ranging from ‘Satisfaction’ to ‘Omni-channel Experience’. 

In this article, we share the resulting insights into Luxembourg insurance customers’ satisfaction, their current experience and identify their future behaviors within the Luxembourg insurance space. Based on this, we point out the ways insurers can recharge their relationship with customers to achieve even greater affinity. 

Lift off together or risk being left behind

Our survey reveals an unambiguous indifference on the part of customers towards remaining permanently loyal to their current insurance providers. In Luxembourg today, 1 in 4 respondents do not know which insurance provider they would choose if given the opportunity to start afresh. More significantly, 6 in 10 customers would not choose to stay with their current provider if starting afresh. 

However, while customers are tempted by new services offered by competitors, up to 85% of them also label themselves as very satisfied with the quality of customer service they currently receive. This conversely reveals that across the board, Luxembourg’s insurers are perceived positively as providers of high-quality services. 

Why then do we mark such a high level of indifference towards current providers? More importantly, how can insurers overcome this market reality - the risk of being left behind - whilst endearing themselves further with customers?

Insurers must react to forces of change by adopting novel technologies and operating models that renew customer-centricity.

A market of traditional insurers and conservative customers 

The questions posed above are significant in the context of the future of the insurance market in Luxembourg. While the answers are not as yet certain, the results of our survey are conclusive and prove that insurers are experiencing difficulties communicating across physical and digital channels. 

The MPS survey identified a strong customer preference for communication channels in which varying degrees of physical and human contact are present (i.e. telephone, face-to-face and email). Nearly 80% of respondents prefer these channels over digital and automated channels, including smartphone apps and websites. This is matched by a perceptible consumer preference for conventional channels, accentuated by the fact that respondent satisfaction rates for digital channels were relatively low (at 4.8/10) whilst physical channels resulted in modest satisfaction scores (of 6.6/10).

These relatively low scores for all communication channels pinpoint an area of acute weakness for insurers, which is adversely affecting their relationship with customers. This is exemplified by the subtle yet salient metric concerning the ease of becoming a customer (i.e. onboarding), which has a worryingly low score of 3.6/10. Therefore, it appears evident that clear, concise and convenient communication is vital to the longevity of all customer relationships - both current and future.

If the relationship is running on empty, how can insurers differentiate themselves?

With only 4 in 10 respondents affirming their loyalty to their current insurer, it is essential that all market players strive to both differentiate themselves and distinguish their credentials in the face of competitive pressure. While doing so, they must account for and contend with the following three market characteristics: 

1.         Indifferent Customers: Luxembourgish customers demonstrate a high degree of indifference and ambivalence towards their current insurance providers. They remain with them out of habit or leave them for competitors based on intangibles such as reputation and word of mouth of family and friends. It’s relevant to note that price is not a key determinant for customers. 

2.         High Expectations: A market not driven by price suggests that it is driven by customer expectations and quality services. Luxembourg customers have high expectations and place great weight on particular metrics gauging the quality of services offered. Respondents gave scores of 8.7/10 for quality of service, 8.2/10 for a targeted product bundle, and 8.6/10 for personalized advice. 

3.         Customer Interaction Touchpoints: 92% of customers report having very infrequent interactions with their insurance providers, which consequently increases the significance of the rare moments of engagement between insurer and customers. These brief interactions serve as “moments of truth” that can either positively fuel or negatively prejudice the lifecycle of these relationships. 

Insurers have all the right energy sources in place to fuel up their services 

In a changing market landscape, insurers not only need to navigate threats from new players and mitigate their own weaknesses, but they also need to leverage their strengths. With high quality services (85% satisfaction), strong reputations (84% satisfaction) and a perceived customer-oriented ethos (76% satisfaction), insurers must seize this opportunity to blend these assets with customer demand and adopt a more people-centric approach. 

Exploring the space beyond insurance…

By adopting an approach centered on the customer, insurers should commit to going beyond what is expected and simply meeting customer needs today. They must power and explore the services of tomorrow by concentrating on two fundamental pillars of the future market: 

1) Phygital in the New

By humanizing technology, insurers will marry personalization with the efficiency that comes with computer-generated offerings to serve a vast and varied pool of customers. How will this be achieved?

Insurers must embed their inherent strengths of personalization within their communication model. These strengths, centered around qualities of human and personal interaction, must become a cornerstone of any future communication strategy that leverages technology (such as self-service websites and smartphone apps chatbots). This will enable customers to connect with insurance providers on a human level that manifests in tailored advice and services. Fundamentally, this approach enables the development of an extended range of services that take the unique needs of customers into account.

2) Beyond Insurance

As the industry migrates beyond the traditional domains of life, health and home insurance, a new range of offerings should be developed to match the growing number of customers seeking novel services within a more personalized context. Humanized communication channels will support this by helping to identify the right services for the right customer at the right time.

Our study identifies a residual interest on the part of respondents for an innovative and extended range of services:

  • 30% show interest in smart IoT solutions in life and health
  • 48% show interest in smart IoT solutions for housing
  • 54% show interest in comprehensive housing solutions
  • 73% are willing to receive computer-generated advice for certain services
  • 77% are willing to pay for niche insurance services

The study also showed a residual interest in innovative services ranging from pet coverage to cyber-security and e-transportation.

These findings highlight the growing importance of an expanded services portfolio for insurers and a key opportunity for them to consolidate and develop long-term customer relationships based on a more people-centric approach to the market (and beyond). 


The Luxembourgish insurance landscape is changing. Driven by disruption and increasing demand from customers who are no longer satisfied with the status quo, insurers must react decisively to maintain their customer relationships and, therefore, their market share. Insurance in the new consists of two primary points of focus. Firstly, a hybrid phygital model of communication to rapidly replace the purely physical interface. With that in place, insurers will be able to better understand and cater to the unique demands of both indifferent and impatient customers. Secondly, a greater emphasis on an enhanced and holistic range of services that go beyond traditional insurance and enter new arenas. 

Ultimately, the 2019 Luxembourg Insurance Market Pulse Survey calls for proactiveness. Standing still will mean being left behind. 

Want to compare your insurance company’s performance with anonymized competitors and benchmarks? We’d be delighted to meet you for a conversation.

The infographic summary of the results is also available here.

Emiliano Luzzi

Insurance Practice Lead Luxembourg

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