General insurers came under immense scrutiny when they raised premiums in high risk areas following the disastrous floods of 2011. During the past three years, as many floods have affected the Queensland towns of Roma, Emerald and Charleville.
Recently Suncorp's (ASX: SUN) chief executive of personal insurance, Mark Milliner, responded to outrage when both Roma and Emerald were blacklisted by the company, but said it had to do something since it "paid out over $100 million in claims, and governments would have paid that much and more".
Mr Milliner was visiting Charleville yesterday to announce that a new levee built in town meant that residents could now have their home and contents premiums fall by $400 to approximately $990 when they next renewed their premiums. This is part of many insurer' plans to capitalise on the mitigated risks once a levee is built, but Suncorp will not resume coverage in Roma and Emerald until it decides how much risk has been mitigated by the proposed levees.
Mr Milliner believes the lower risk profile will bring benefits to the Queensland insurance and reinsurance industry, "from the perspective of low risk, it flows right through the insurance and reinsurance industry". However, this isn't the only way Suncorp is delivering benefits to customers.
Suncorp has been looking to improve its relationship with customers for some time and recently made a $3.5 million investment in bringing an online vehicle accident repair information tool, known as Escribe, to Australia. The tool will help insurers and repairers with easy and affordable access to fully researched and globally recognised repair times and methods.
Foolish takeaway
Even our biggest companies need to pay attention to customers because it not only helps them improve their business but also keep customers coming back. Suncorp has a number of insurers to compete with domestically including Insurance Australia Group (ASX: IAG) and QBE (ASX: QBE) and, as it remains the only one of the three not to expand overseas, it needs to maintain healthy relationships with Australian businesses and private customers to improve on results.
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Motley Fool contributor Owen Raszkiewicz does not have a financial interest in any of the mentioned companies.
