Approximately 60 insurance industry research professionals assembled in Jersey City, NJ from March 5-7, 2018 for the SIR skills development workshops. Industry trends were discussed, but the primary focus was on best practices to improve primary research, secondary research, and data analysis. Several sessions also addressed how to tell compelling stories to engage the C-Suite and generate buy-in to create industry-wide change.
Insurtech is getting better all the time
The kick-off session and keynote focused on the role of Insurtech, with comments on how emerging Insurtech companies will change the insurance business model. Noting that most Insurtech companies work with traditional carriers for key back-office functions, their main goal is to change the overall insurance business model. One area of change covered in this session included the role of “data wrangling” and improved “data resolution” on underwriting accuracy. The session ended with a question as to whether the emergence of big data, with better resolution and accuracy, will transform insurance into a commodity product. The presenter addressed this with a note that carriers must find better ways to differentiate through tailored service and product offers if they want to avoid commoditization.
Rate of change in the industry is accelerating
A panel discussion following the keynote picked up on the rate of change in the industry. This included examples on how digital and automation are speeding up every process from new customer interest to quote to close, and from incident to claim to payment. In today’s market, speed is a competitive advantage. Along with speed, the proliferation of data, and access to that data, is changing the entire insurance business model. Access to data will allow carriers to reduce the number and size of premium changes made between quote and underwriting, where at present close to 35% of internet quotes are changed between quote and underwriting. Interestingly, some panelists noted that many of the changes and innovations present in today’s market are reboots of similar changes made in the insurance industry over the years, differing in the technology used, but all related to the same goals: speed and accuracy.
Customer engagement should drive action
The message on Voice of the Customer (VOC) programs is that, when done right, they can mostly prevent truly bad experiences. The key to successful VOC programs is that they must follow a set checklist. According to the presenter (Confirmit), the checklist should:
- Be consistent – it must run over longer periods of time and track changes
- Be inclusive – include all types of customers
- Get input – from the internal groups affected by the program
- Use local champions – to support the program and lead change
- Take action – where it is needed and track results
- Demonstrate value – prove that the program has led to better customer satisfaction and financial results
Customers are used to the service and quality they get from companies such as Amazon, which have revolutionized the customer experience and set new standards. With this, it’s becoming harder to meet customer expectations, and the bar continues to be raised. Customers expect quick, seamless interactions where they can accomplish their objectives digitally. However, industry experts tasked with website development have subconscious biases, which can result in design and content that isn’t intuitive to a consumer. To overcome this misalignment, they should get input from customers about what works and what doesn’t. Companies that integrate agile, continuous improvement cycles with customer input can align customer expectations and industry actions.
Secondary data is more than just Google
A session on secondary data and tools to help collect better secondary highlighted that Google top hits are not always 100% accurate. Google is a link-based search engine, which means that its indicator for “quality” is the number of people that link to a certain website. Google is the first place that many of us go to begin our research, which is fine, but triangulation and fact checking, using other sources (e.g. annual reports, industry podcasts, primary research, customer surveys, public company earnings calls, podcasts, and SlideShare) is needed. Another tactic includes gathering presentations from conference proceedings.
The right presentation style makes a difference
Another session covered presentation styles. The days of extremely detailed reports and expecting strong positive responses are over. Information overload forces companies to focus on enhanced storytelling through “snackable” decks, dashboards, infographics, and videos. Many professionals have learned how to present visuals using Tableau, while others hire digital designers to bring their vision to life. These tools help companies to highlight core messages and are effective when presenting to busy executives.
A following session highlighted a different aspect of presentation style. Flexibility is the key and it is more than just using “snackable” decks; not all stakeholders want a single key bullet point and simplistic visual presentation. While some favor limited words and a compelling visual, others prefer more detailed written findings. Some may prefer formats which are more conducive to reading on iPads or on the go. In all cases, research findings should always be aligned with the key business problem and connected to the “big picture.” Knowing stakeholders’ presentation preferences is essential for providing the most impactful insights. Incorporating graphics, videos, and audio are ways to engage, and all should be used where appropriate.
Securing buy-in from C-suite
Any change from the current way of doing things will face skepticism or even backlash. During the session on communicating with the C-suite, panel participants noted that for any new program, such as implementing a Win/Loss program, embarking on a VOC research study, or moving towards agile development, larger initiatives will only succeed when they have the full backing of company management. These changes require humility and reflection to understand how certain products or processes could be more successful, and may highlight organizational or personal failures. The C-suite must encourage a culture that learns from missteps and promotes future improvements.
The SIR Spring Workshop covered several key research skills that will help the SIR community stay informed on developments and build strategies.
From our perspective, the big takeaway really is about how the Insurtech revolution is driven by big data. New Insurtech companies seek to automate processes for better digital engagement, but make no mistake about it, the Insurtech companies’ long-term goal is to disrupt the entire insurance business model. As one speaker noted, these companies are likely to follow a path similar to what is underway in FinTech; the finance business model now leverages technology and data to offer customized packages for customers based on lifestyles, life stages, risk tolerance, and other factors.