As we embark on a new year, I’m reflecting on conversations I’ve had in the past year with many industry thought leaders and insurance executives who have opined about the future of insurance. I’m also pondering how much was written about the innovations and market disruption from technology advances (e.g., digitalization, the Internet of Things, big data, mobility etc.) and the shift in consumer experience from companies such as Amazon.com, Apple, and Google. The great news for 2015 is that opportunities exist to innovate like never before, in both the product space and the consumer experience. I’m not going to rehash all of those opportunities, though, since I’d rather talk about the number one barrier to achieving them—the hindrance of legacy systems and the aversion to the risk of replacing them.
Remember when the model for engaging with consumers was as simple as sending out enrollers with disconnected laptops and that was considered high tech? How times have changed. It's now a consumer-centric environment where consumers expect to choose how, where and when to interact. In a consumer-centric environment expectations run high, the long term success rate of group-based carriers and voluntary insurers depends on the ability to interact in an omnichannel environment – a bar set particularly high by the retail industry. The fact is, given the sheer range of channel options and product choices that exist in the marketplace today, insurers have a tremendous opportunity to build a strong connection with consumers.
Carriers competing in the employee benefits space have long recognized the benefits of aligning to their distribution partnerships. In fact, they did this extremely well for the past 30 years as carriers custom built their own core systems based on the products that they sold, to the markets they sold them and the channels they sold them through. It was a comfortable silo and it worked, until...
Enrollment options are expanding. With dozens of third-party vendors (including the emergence of new market places that include public and private exchanges) the opportunity for carriers to successfully increase their enrollment rates and get their products out to the various markets has never been greater.