You have surely heard it said that small businesses are the growth engine for America. Today, the phrase has a special ring to it for benefits insurers. The small business market is often viewed as an opportunity attractive to growth-minded insurers because the focus of the majority of carriers is on the larger, highly-competitive end of the market.
Something normal happened during Mardi Gras this year in New Orleans. Amongst all the chaos, a conference broke out. Workplace Benefits Renaissance held its annual event. The meeting draws notable thought leaders and personalities within the industry and, if you were able to resist the revelry in the streets, there were some interesting stories heard and lessons shared.
Think you have heard all you need to know about the benefits of cloud deployment of enterprise solutions? Get ready for more because cloud is finally in season and bearing good fruit for insurers. The latest news is Amazon Web Services (AWS) announcing its financial services competency program to the marketplace, indicating a strong focus by one of the largest cloud providers on an important vertical. EIS is pleased to have been a launch partner for the initiative. So what is the significance of the AWS move? Industry observers were quick to weigh in on how it influences insurers’ choices and approaches for core systems in the cloud.
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On February 2, Groundhog Day, something different happened at the annual LIMRA Enrollment Technology Strategy Seminar (ETSS). For the last three years, EIS Group has sponsored ETSS and each year, the latest approaches and challenges to benefits enrollment are discussed. But just as the venerable Punxsutawney Phil himself is prone to do, each year the attendees see their long shadows – of legacy technology constraints – and withdraw to comfortable, insulated dens rather than embrace an early spring of much-needed change. Not this year. For the first time, the conference coalesced around the root cause of enrollment problems: connectivity.
When the ball dropped on 2017 it opened another pivotal year for digital transition. Some insurers feel poised for digital success. For many others, small gains have been hard won and their positive business impacts quickly muted by a fast-moving business landscape. 2016 compounded their conundrum by exposing the vulnerable underbelly of insurers, Uber-style, to new business models—such as on demand insurance—new entrants, and emerging InsurTech. If all this caught you by surprise, and you have not had time to formulate a response, 2017 is now or never. Sorry, the party will have to wait.
What side of the digital divide are you on? You’ll find the answer in the new ACORD/Genpact report, Assessing Digital Impact Across Insurer and Channel Operations, which offers insight into the traits that make up either a digital leader or a laggard. It turns out that the great majority of “digital leaders” are those companies that have successfully aligned the back and middle office with the front office.
A recent announcement from Liberty Mutual shared with the industry how they leveraged our EIS Suite™ software and the power of the AWS cloud to create a new, single cloud-based platform for their benefits business unit. The implementation timeline was very aggressive and called for an accelerated schedule of getting from scope to live in under seven months. The implementation team creditably accomplished the goal and they did so by following modern software delivery practices.
The tech talent battle is waging and at this point insurers are not faring well. The competition is stiff across all sectors for much in demand skill-sets needed for success in the digital age. The problem for insurers is part perception, part reality. Insurance is not on the radar of millennials as an exciting career, and many insurers are still transitioning from a legacy technology. Where is the cool stuff that fresh and smart tech talent wants to work with? Insurers will need to scrutinize their technology choices and strategies if they want to attract critical talent to scaffold the next century of insurance.
Drones, bots, blockchain, AI and machine learning are what everybody is suddenly talking about. Start-ups with cool names like Trov, Slice, Goji and WeSavvy are the talk of the insurance town, yet just a year or two ago core transformation toward becoming a digital insurer was all the rage, and the names of core vendors filled the headlines. Now, it seems like all the cool stuff is happening peripherally to the core and some great examples peppered the lively discussion of Insurtech and next-gen insurance at the recent SMA Summit.
When it comes to benefits insurance market expansion…it’s good to be a “yes” man
What stood out this year at the LIMRA Group and Worksite Benefits Conference was all of the talk around small businesses. Yes, it is an election year. But no, this was not just an echo of every candidate’s familiar refrain about how small business is the growth engine for America and must be supported. For benefits insurers, this is an every year issue. Carriers struggle to make small business a plank in their platform for business growth. The result is that growth opportunities are left on the table while the majority of carriers are forced to battle over the same books of business in the large and jumbo case markets.