By Keith Martin, Co-Executive Director, CAFII
According to a new CAFII-commissioned survey by Pollara Strategic Insights, the COVID-19 pandemic has changed the way many Canadians deal with their financial institutions. And it has also increased their interest in insurance.
The survey shows that COVID-19 has raised the prominence of insurance as an option for Canadians, with 65% of respondents saying they are more likely to obtain Credit Protection Insurance (CPI) for a mortgage or Home Equity Line of Credit (HELOC) than before the pandemic. That level of interest in insurance should not be surprising given the serious health impacts and high mortality rates that COVID-19 has caused.
With respect to the various types of CPI coverage purchased during the pandemic, 77% selected life insurance for a mortgage, and 71% for a HELOC. In addition, the percentage of consumers covered for disability, critical illness and job loss was up by 17% over 2018, when the question was last posed to consumers in a similar Pollara survey.
The pandemic has also helped more Canadians embrace financial technology and move beyond in-person transactions in their financial institution’s branch. For example, 84% of consumers who participated in the survey say their experience during COVID-19 has made them more comfortable conducting financial transactions online, 72% say it has changed the way they want to conduct these transactions in future, and 70% say they have upgraded their technology to make it easier to conduct these types of transactions from home.
As Canadians went through long periods of stay-at-home orders, and many financial institutions restricted access to their branches, this trend towards conducting more financial and insurance transactions virtually during the pandemic was a natural outcome. However, while Canadians may have fallen in ‘like’ with digital finance, they still ‘love’ dealing with real people for more complex financial transactions.
For example, 66% of survey respondents say they are looking forward to going back to their financial institution branch at some point in the future. Canadians also want the opportunity to deal with financial representatives, with 88% saying they would prefer this method, especially for arranging loans and insurance. That doesn’t have to take place in a branch, however, as 47% of respondents say they would prefer to speak with a representative over a phone.
The same sentiment applies to making an insurance claim, with 77% of respondents saying they would prefer to submit a CPI claim with the assistance of a representative, compared to 22% who would choose self-service.
In terms of their purchase experience with CPI, 96% of survey respondents say they were somewhat/very satisfied, a nine-point increase over the last time the question was asked in 2018. Similarly, consumers report an increased level of confidence in, and knowledge of, the CPI coverage they purchased.
These are some of the key findings of the Pollara Strategic Insights survey conducted in March 2021 which asked Canadians who had purchased CPI on their mortgage and/or HELOC — since the pandemic started or planned to do so within the next two years — about their experiences and future financial transaction preferences. The survey is the latest in a series commissioned by CAFII over the past six years which is designed to help the Association’s members remain up-to-date on the expectations, priorities, and satisfaction levels of customers, and to identify areas for improvement. This is part of CAFII’s commitment to understanding CPI consumers’ preferences and to fostering the fair treatment of customers.
While the pandemic has, and will continue to change the way that Canadians conduct their financial transactions, it’s good to see that consumers are adapting well to the new reality, and that our industry’s customer satisfaction levels have been up to the challenge. It’s also satisfying to see the value that Canadians place on the availability of in-person service, and their confidence in the people who provide it.
The Pollara Strategic Insights study about the impact of COVID-19 on Canadians’ preferences for conducting their financial transactions can be found on this website under the research icon.