It’s the ultimate irony. Insurance carriers are in the business of risk management, assessing risk while predicting revenue and expenses and then pricing for that. However, the mechanisms many carriers use to generate the rating systems their pricing depends on expose them to risk.
New technologies. New players. New products. New business models. The clamor of disruption is loud in our ears, but seeing a clear path for adapting to change and implementing new technologies to support change is hard. In their urgency, are insurers force-fitting disruption on old operating models and systems?
Last week I had the pleasure of joining my industry colleagues at the LIMRA 2016 Enrollment Technology Strategy Seminar in Charlotte, NC. We spent a fun evening at the NASCAR Hall of Fame which also presented me with an interesting juxtaposition because NASCAR is a sport based on speed, strategy and serious horsepower, yet our industry has been stuck behind the pace car for quite some time.
Who is the current pacesetter? It’s the majority of group benefits insurers with legacy systems that lack the horsepower necessary for their business to move up in the field.
Technology can be both a tool and a tyrant, and the theme of this week’s Insurance-Canada Technology Conference—Technology: A Two-Edged Sword—depicted that reality. If designed, implemented, or used incorrectly, technology can divide and weaken rather than unite and strengthen an insurer’s position in the market. Recognition of this fact is increasing as evidenced in the many conversations that took place at the conference reflecting the need for more unified organizations and unified technology to support them. And the key driving force? The customer.
Something is altering the basis of competition in the voluntary benefits marketplace
As we get ready for Super Bowl 50, there’s no better lesson for business than the half-time adjustments made by coaches and players. Teams go into the big game with a plan that they’ve prepared and practiced all week and when they show up, they are ready to execute. This is not too dissimilar to how some of the group benefits carriers have planned and prepared for the shifts within the voluntary benefits marketplace and have been putting up points.
You and I, and the brotherhood of all consumers, enter 2016 firmly in control of our buying destinies. Since Forrester announced it was the ‘age of the customer’ in 2011, our rise has been meteoric. We are a force awakened; our expectations are high and we are emboldened by our new disruptive power.
You got the email. “We need to improve our customer experience. Our conversion and retention numbers are down. What can you do?” In fact, you got several emails and briefings from marketing and line-of-business leaders, and you were copied on a complaint from a key producer citing frustrated policyholders. You know what it will take, but how do you explain in a simple and concise way to peers that it will entail a whole new level of integration between your sales, marketing, and core systems?
Like the lives of so many celebrities and reality show families, whose relationships and daily interactions are splashed across our screens, insurers’ views of their customers present the same frustrating dilemma: sometimes they want to reach into the customers’ world and try to help influence decisions. But just like on TV, it seems today’s insurers can look, but aren’t actually touching their customers. True customer engagement continues to evade even the savviest of carriers.
My role at EIS Group allows me to attend a lot of industry events throughout the year. Most are focused on technology, innovation, and change, but only a select few deliver the level of value provided by the annual SMA Summit.
I left this year’s Summit with new insights and ideas, so I am sharing my “top 7 takeaways” in this blog.
LIMRA’s Group and Worksite Benefits Conference was once again a vital and energetic meeting place for the industry. EIS Group has been a premier sponsor for the past three years, and we have had many conversations with talented people who are struggling with the transformation taking place within the industry and how to respond to it with their hard-to-adapt legacy technology.