The Challenge
- The National Flood Insurance Program (NFIP) fills an important role by providing government backed disaster insurance. However, the program struggles to increase its policyholder base despite the increasing frequency of flooding disasters.
- Flooding events in the last several years have caused flood damage outside of known higher risk areas where flood insurance is mandatory. As a result, the NFIP is working to increase voluntary flood insurance uptake.
- Despite the growing risk of major flooding events, many homeowners are unaware of their flood risk and fail to take advantage of lower cost policies designed for those living outside of the 100-year floodplain.
- The NFIP needed a new approach to marketing that increase awareness of flood risk and different NFIP insurance options, while also driving new sales and improving customer retention — thereby increasing national resilience to flood disasters.
Our Solution
Keybridge evaluated NFIP customers purchase behavior, researched and tested the degree to which cognitive biases may affect flood risk perception, and performed data-driven market analysis to design an end-to-end marketing solution for the NFIP.
- Applied Targeting: We developed a comprehensive understanding of variable flood risk across the country, different customer characteristics, and flood insurance purchase behavior based on disparate data sources to efficiently reach potential NFIP customers with compelling messages and marketing materials.
- Experimental Design: We designed a randomized control trial (RCT) to systematically test the effectiveness of different marketing outreach methods and generate statistically sound results and insights. Key takeaways from each year’s RCT was used to update and improve our outreach methods and messaging in subsequent years.
- Performance Evaluation: We created a data-driven framework to evaluate various aspects of marketing campaign performance. Specifically, we tracked engagement with digital advertising, evaluated trends in NFIP website traffic, and modeled the impact of targeted marketing on insurance purchases and the associated return-on-investment of marketing campaigns.
Keybridge presented its methodology, results, and recommended next steps in a series of presentations to agency leadership.
End Results
Our iterative targeting process, experimental approach to learning and improving, and detailed performance evaluation benefitted the NFIP’s marketing efforts in several ways:
- We reversed a persistent decline in the NFIP policy base, including boosting purchases of voluntary insurance policies.
- We built a new language for risk communication that can underpin future NFIP marketing efforts.
- We developed a deep understanding of innovative analytical techniques to evaluate the performance of marketing efforts.
- We created a “marketing campaign in a box” framework to enable national and regional FEMA offices to increase local flood risk awareness and drive interest in flood insurance.
