ANALYSIS OF THE BRAND POSITIONING OF INSURANCE COMPANIES IN THE MARKET: A PERCEPTUAL MAP, THE COST OF DISTANCE AND THE GAP BETWEEN CLAIM AND PERCEPTION

Abstract

Insurers describe their positioning in words and then compete on the same two or three attributes. This article maps where they actually stand. Nine hundred customers rated sixteen insurers on eight attributes, and the brand means are reduced to two dimensions by principal components, which recover 61.5 per cent of the variance: the first carries claim fairness (0.87), financial strength (0.71) and staff attitude (0.72), the second digital convenience (0.86) and low price (0.68). Three customer segments are identified with distinct ideal points, and no insurer occupies any of them: the nearest insurer to the value-seeker ideal is 0.8 map units away, the nearest to the service-seeker ideal 1.9. Distance to the nearest segment ideal is what predicts preference share: each unit costs 2.87 points of share (t = minus 2.69), and the four positional variables explain 39 per cent of the variation in share. Two widely held expectations are not supported. Differentiation as such, measured by distance from the centre of the map, has no detectable association with share (1.72, t = 1.70), and crowding, the number of rivals within 1.2 units, has none either (minus 0.58, t = minus 0.69): insurers cluster where customers are, and the clustering neither helps nor hurts once proximity to a segment is accounted for. The largest gap in the market is between what insurers say and what customers hear: the mean distance between an insurer's claimed position and its perceived position is 2.10 units, two and a half times the mean distance to the nearest competitor, and the gap has no association with share (0.370, t = 0.50). For the worst-positioned insurer below median share, moving to the 25th percentile of distance, a position four insurers already hold, is worth 7.6 points of share; reaching the same gain through awareness would require more than a hundred points, which is impossible.