INSURANCE, TECHNOLOGY, AND MORE
Taking a Closer Look at Your Client’s Risk Control Initiatives
As the P&C market changes and begins to harden in the next few years like many industry publications and sources have reported, why not take a closer look at your client’s risk control initiatives now before they become an underwriter’s recommendation during your upcoming renewal discussions? In fact, carriers have already implemented higher underwriting standards in many cases.
Promoting Risk Control Priorities and Initiatives
As someone who made the transition from an insurance buyer to a commercial retail broker during the last hard market, I experienced firsthand that one of the most influential approaches you can take to sell a client’s risk to an underwriter is to show them what you are doing to minimize the probability of claims by promoting a company’s approach to its risk control priorities and initiatives. A few ways you can accomplish this are:
- Providing copies and details of loss control plans to underwriters in your P&C submissions
- Introducing your client to underwriters to discuss claims and what you and your client are doing to reduce frequency and severity issues prior to renewal discussions
- Recommending new risk management processes and tools that reduce your client’s total cost of risk
Focus to General Liability Underwriting
Of course, GL is the insurance policy that your clients purchase during the annual renewal process to transfer a portion of third-party financial or vendor risk to an insurance carrier. Using a risk control tool that efficiently tracks vendor contracts and the specifics of their insurance programs as well as indemnification provisions is a great way to proactively minimize third-party risk in this area. Promoting the results of this tracking process via automated compliance reporting, which is shared with your underwriters, is key to obtaining the best possible GL placement outcomes.
What are you doing to help your clients manage risk and understand their true exposures? Leave a comment and use the social buttons to “share” this post with your peers.
Justin Gregory is Applied Systems’ resident risk manager and lead Applied certTrax sales professional. With more than a decade of corporate risk management and insurance brokerage experience, Gregory has tracked certificates of insurance directly and indirectly across multiple industries.
Western Financial Group Powers Growth with Applied Epic
Changing Consumer Expectations
In Canada, as most everywhere else, brands like Apple, Tim Horton’s and so many others are changing the way consumers expect to do business. Yet the insurance broker model in some cases has lagged behind in meeting these new expectations. Customers want to interact with businesses, including insurance brokers, through multiple channels, and not just traditional ones.
A couple of weeks ago, I spoke at length at the National Club in Toronto about Western Financial Group’s decision to adopt Applied Epic, a software platform that will enable us to realize greater business productivity, increased profitability and enhanced customer service.
New technology, specifically a broker management system, will be the single most important thing we do going forward at Western. Our 120+ offices across western Canada demand one scalable system, which is critical to our rapid growth trajectory. Our rigorous selection process, which included on-site visits, user-acceptance testing and a criteria list with hundreds of items, led us to Applied Epic.
Establishing a long-term platform for sustainable growth. By the end of 2013, Applied Epic will be in up to 120 branches, where one broker management system will automate workflows, mitigate risk, offer digital self-service to customers, and enable us to drive sustainable growth and profitability. Applied Epic offers us the flexibility to leverage technology evolutions such as mobility through one powerful broker management system.
A software system alone is not going to catapult any company in front of its competition. Rather, it provides a foundation for success and growth.
To learn more about why Western Financial Group chose Applied Epic, watch this video.
How is your business using technology to drive growth? Join the conversation and share your thoughts in the comment section below.
Jeff Burke is President and CEO of Western Financial Group (Network) Inc., the largest property and casualty brokerage in western Canada. It provides property, liability and life insurance as well as banking and investment services for more than 600,000 customers.
The Transforming Agency Model
Virtual Business Drivers of Change
While traditional businesses and retail storefronts are a mainstay in communities across the country, virtual insurance agencies devoid of any physical location at all are capable of serving customers from anywhere in the world. As a technology consultant to insurance agencies, this is a fascinating trend based on key drivers in the changing landscape of insurance business.
Virtual agencies thrive on two drivers that underlie the need for insurance agencies to change the way they do business:
Driver 1: Mobility
Consumers flash their phones to board planes, buy coffees, and everything in between. Mobile device adoption is skyrocketing, and consumers expect to be able to carry out any type of business transaction using one. As of June 2012, nearly 55 percent of mobile subscribers owned smartphones.1 And that’s not including consumers who connect via laptop or tablet.
Implication:
- Agents must provide mobile customer service options to the connected consumer.
- Agencies must make it possible for staff to conduct business in the field via mobile web-enabled devices.
Driver 2: Talent Acquisition
Increased mobility means telecommuters have reached unprecedented numbers. By the time approximately 50% of current agency staff retire over the next 10 years2, will the next generation of talent be willing to work in a conventional office? Attracting the best talent will increasingly require offering flexibility.
Implication: Two potential models
- Agencies can extend the physical office and increase staff’s mobile capability with devices and telecommuting options.
- Companies can establish a virtual agency built on a staff of telecommuters.
What do you think about virtual business? Is your agency moving in this direction?
To learn more about this topic, watch this webinar I participated in on April 19, 2013 titled, “The Virtual Agent: Transforming the Traditional Agency Model.”
Access the Virtual Agent Webinar >>
Steve Anderson is the president of Anderson Network, an insurance agency consulting firm and executive editor of The Anderson Agency Report (TAAR). He can be reached at steve [at] taareport.com.
1“Two Thirds of New Mobile Buyers Now Opting for Smart Phones.” Nielsen Newswire. Nielsen.com. 12 July 2012. Web. 12 April 2013.
2“2012 Agency Universe Study.” Conducted by Big “I” and Future One. Independentagent.com. Web. 12 April 2013.
Is your agency using download as much as it should?
Download has become so prevalent in insurance agency operations, its value is often overlooked. Most agencies would have difficulty surviving in today’s market without it because it saves staff a tremendous amount of time from having to re-enter basic data and protects agencies from errors and omissions (E&O) risk.
Download is the process in which carriers and wholesalers transmit transactional data from their systems to agencies’ management systems for automatic data synchronization and updating. The major forms of download include policy, billing, claims and activity transactions occurring within the carrier or wholesaler systems.
Many have taken advantage of the efficiencies of personal lines download. The cost of manually entering all of that data, and the potential exposure to E&O if there is an error, is simply too high. Yet, it is puzzling why more agencies aren’t taking advantage of commercial lines download, claims download and direct bill commission download. The benefits should be too big to ignore.
Doing away with manual data entry
Agencies would have a difficult time remaining profitable today if they had to pay staff to manually enter all personal lines policy changes that occur each day. Yet, that is what many agencies do with commercial lines policies, claims, billing and other carrier transactions. It’s unnecessary.
Each agency should evaluate all download capabilities offered by their carriers and develop a plan for enabling receipt of all download options (See a list of download capabilities offered by carriers through Applied Systems software solutions here).
Better, more accurate customer service
The data residing in the agency policy, claims and billing databases serves as the starting point for most customer service functions, as well as the basis for additional transactions. Data downloaded from carriers:
- Is the basis for Auto ID cards, certificates of insurance, summaries of insurance, and helps the agency perform general inquiries from the customer.
- Is also the basis for additional transactions, such as endorsements, renewals and First Notice of Loss.
- Generates automated billing transactions, which in turn create automated producer payable reports. Many agencies pay staff to manually calculate producer payables. Using download accurately could eliminate this costly step.
Reduce E&O exposure
Carrier download comes directly from the carrier systems that issued the policy, endorsement, claim or billing. There is no more accurate version of the data. It makes sense to have the most accurate data being used to update your agency’s customer servicing tools.
Accurate, seamless data feeds to external applications
Having accurate and seamlessly updated data is certainly important when it is just the agency staff accessing policies, claims and billing records. However, today, agencies’ databases are being used to drive other applications.
More and more agencies are extending their agency to the web, providing their customers with 24/7 access to their account information.
Mobility is offering agencies opportunities to be more productive. Producers have embraced tablets and mobile applications because they can get more done while out in the field. Implementing download functionality ensures current, accurate information is available to them.
In these applications, having data that is accurate and seamlessly updated via carrier download, without human intervention is an absolute must.
So where does your agency stand with download? Are you leveraging every possible carrier download?
The Business of Insurance is Changing
The business of insurance is changing with a technology convergence that is redefining the way our industry works. Data has become increasingly important throughout our industry. Consumers now expect greater access to insurance information. Agencies want cost-effective methods for analyzing customer data so they can both grow and retain their book of business. Carriers want insights on how to better market and sell insurance through the agency channel.
With change comes opportunity. While Applied remains true to delivering the industry’s leading agency management systems, we are expanding the breadth of our product line in order to fully automate the entire insurance life cycle – from the carrier to the agency to the insured. You’ll see us continue to improve the ability for agencies to connect electronically with their customers and enhance the electronic data exchange between carriers and agency management systems, creating greater value for our customers and our industry.
Yet, it’s more than software with us. Since Applied’s founding, our people and products have enabled our industry to safeguard and protect what matters most. This adds a higher purpose to what we do. We’re not only helping agencies, brokerages and carriers run their businesses – we’re also helping them fulfill the promises they make to their customers each and every day. It’s a worthy purpose – one that will always be a part of what we do.
As we look to the future of our industry, we embrace the change and opportunity ahead. Big things happen at the intersection of opportunity and innovation – big enough to change an industry. That’s where you will find Applied. For more than 30 years, we have led industry innovation that powers the business of insurance.
Let’s make big things happen together.
How do you think the business of insurance is changing? What opportunities do you see for innovation at your agency? Tell us in the comment section below and use the social buttons to “share” this post with your peers.
More drivers using smartphones to show proof of insurance
Clearly recognizing the changing times and technology, California recently became the seventh state after Alabama, Arizona, Colorado, Idaho, Louisiana and Minnesota to modernize proof of insurance laws to meet the needs of the digital consumer.
The electronic proof of insurance legislation (Assembly Bill 1708), which went into effect at the beginning of the year, gives California motorists the choice of providing proof of insurance to police electronically via a smartphone or mobile device versus presenting a hard copy document.
Such legislation is a win/win for consumers, police and court officials. Since “fix-it” tickets and court dates will no longer be needlessly issued to drivers who have coverage but not an actual paper copy of their proof of insurance, valuable time and money will be saved.
A competitive edge for agencies meeting the needs of the digital consumer
The new law is also a big win for insurance agents who respond to the modern consumer’s demand for quick and easy online access to their insurance information. There’s real savings to be had in moving from paper-based systems to digital portals. Agencies will significantly reduce expenses related to printing and mailing policyholder documents.
Given how consumers have embraced mobile technology, it’s only a matter of time before more and more states pass similar legislation. More than 20 states are considering electronic proof of coverage bills or regulations in 2013, including: Arkansas, Colorado, Florida, Georgia, Hawaii, Indiana, Iowa, Kansas, Maine, Michigan, Missouri, Mississippi, Ohio, Oregon, Rhode Island, South Carolina, Texas, Utah, Washington, Wisconsin and Wyoming. Wyoming’s measure, SF 87, has already cleared the Wyoming State Senate.
Insurance agents who provide their customers with the on-demand self-service functionality that consumers have come to expect stand to gain a substantial competitive edge in their markets. In fact, agents who have added a digital client portal to their customer service strategy have seen higher sales and improved client retention rates. It’s important to note that the access to electronic proof of insurance is more than a picture of the ID card stored on the device. It’s an ID pulled on demand with up-to-date information from current policy data within the agency management system.
Alex Hageli, director of personal lines policy at Property Casualty Insurers Association of America, summed it up well when he said:
“Electronic proof of coverage is the wave of the future given how prevalent smart phones have become. Policyholders want to go ‘green,’ but without a change in the law insurers are still required to send paper ID cards to each customer. Several insurers already offer apps or will email copies of policies to consumers. Hopefully more states will follow in California’s footsteps in 2013 and modernize their proof of coverage laws.”
Want to learn more about the benefits of adding online access to your service offering? Applied Systems client portals integrate with most agency management systems.
How do you see this change in legislation affecting your agency? What steps are you taking to meet the needs of the digital consumer? Tell us in the comment section below and use the social buttons to “share” this important industry legislation with your peers.
ID federation and customer retention
Managing customer retention in the digital age is a critical component to growth and profitability
I recently had a chance to participate in round-table sessions held by the Independent Insurance Agents & Brokers of America’s Agents Council for Technology (ACT) and the ACORD User Group Information Exchange (AUGIE), where we discussed pressing issues for agencies that hinder business the most.
Following the discussion sessions, ACT and AUGIE agreed to work together to advance four initiatives in 2013:I recently had a chance to participate in round-table sessions held by the Independent Insurance Agents & Brokers of America’s Agents Council for Technology (ACT) and the ACORD User Group Information Exchange (AUGIE), where we discussed pressing issues for agencies that hinder business the most.
- ID federation
- Real-time downloads
- E-signatures
- Client self-service capabilities
It’s no secret that managing customer retention in the digital age is a critical component to insurance growth and profitability. Insurance agencies and carriers have to make the customer experience richer and more efficient, which ACT and AUGIE are committed to addressing this through these key initiatives.
Taking Friction Out of Customer Payments
The particular discussion group I was part of talked about how difficult it can be assisting customers when they’re trying to pay their bills. When carriers bill customers directly, customers often turn to the agency for help with payments. It sounds like a relatively routine process, but often it’s not, and it can cause customer headaches.
Real-time interface technologies have allowed agencies to quickly access customer billing records from carriers. But accepting or making a payment can be another matter entirely. Agencies will often accept payment from the customer and then direct carriers to do a cash sweep against the agency’s account. This can sometimes be a cumbersome process and costly for the agency. Finding an easier way for insureds to pay online would be a convenience many would appreciate and an opportunity for agencies to build stronger relationships to improve customer retention.
Looking to ID Federation
Offering convenient online payment options is possible and can more quickly become so through standards maintained by ID Federation Inc., a non-profit group that is creating a single sign-on framework for the insurance industry. Today, agencies are required to maintain separate IDs and passwords for each of their employees – for every software application and website they use. This challenge is further compounded because insurance customers need IDs and passwords too.
ID Federation Inc. is developing legal and technical standards that ensure a secure and consistent authentication between software products and business entities, effectively eliminating the need to maintain dozens of separate IDs and passwords. This will make doing business smoother by reducing the time and cost it takes for businesses and individuals to manage logins and passwords. If an agency’s customer logs into the agency’s website, the identity of that customer can be “federated” securely to any insurance company and grant direct access to policies, claims and billing information, and allow the customer to make payments.
Why this Matters
Easier online payment capabilities are just one customer service advantage ID federation can bring to agents and the insurance industry. This is an important industry priority that will encourage agencies and carriers to expand their use real-time data exchange by eliminating obstacles and the costs of authenticating individuals’ permission to access data. Providing customers with easy, fast and complete service at all touch points is what will make insurance agents and their carrier partners most successful.
How do you see these initiatives helping your business? Tell us in the comment section below and use the social buttons below to “share” this important industry initiative with your peers.
Technology keeps Beneficial Insurance agile in a competitive market
Two years ago, our agency president asked me, “What exactly does a customer-centric agency look like?”
Good question…really good question. My response? “I’ll get back to you on that.”
At the time, we were in the middle of merging two agencies with multiple software systems into one. We were refocusing and redirecting two different entities with two different systems, structures and cultures into one integrated and successful team. It was a major task.
As I thought about the question more, I realized that being a customer-focused agency was already a driving force we all believed in here – putting the customer first at every occasion. It was critical in our re-organization efforts to not just merge the agencies but to reorient the organization as well. We went from 10 departments to four collaborative teams that are organized not by what we sell, but by who we sell to.
To complement our reorganization, we needed the right kind of technology to support the effort. When you look at how the industry is evolving, independent agencies will be able to compete in this new market, this new economy, if they have technology that allows them to be flexible and to adapt to changing conditions. In other words, we have to be agile. If the market is forcing our agency to be more creative with our business model, we need technology that is going to support our creativity. We need the right tools that will be able to make the turns as we need it. We can’t afford to be forced into a traditional business structure because of the limitations of our agency management software.
A flexible, technologically advanced agency management system was the tool we needed. Instead of having to organize everything we do around the software, we can customize the management system to fit the way we do business. That gives us the flexibility we need to be responsive to our customers.
The software’s ability to document as the staff works has measurably cut our processing time. Our activity usage is half of what it was prior. By taking advantage of the system’s flexible setup, we’ve simplified and streamlined our workflows. The software automatically prompts for the documentation needed, when it makes the most sense to enter it. If users don’t need the information, they never even get the prompt. In essence, we have programmed our process manual into the agency management system. Our workflows require minimal training and we get a monthly audit process that has been shortened greatly.
We feel as though we have a system that works for us, not vice versa. We can begin to transition to a proactive, engaged and customer-centric sales organization.
Technology strengthens a human connection when it’s used properly. We know our customers better and serve them the ways they want and need.
How are you keeping your agency agile in a competitive market? Have a question for Jackie? Join the conversation and share your thoughts in the comment section below.
Seeing the practical side of mobile technology
Mobile technology has been a frequent discussion topic in insurance circles for several years, and for good reason. It can change the way insurance agencies do business, especially in how they establish and maintain business relationships. Mobile technology frees agents and brokers from the restraints of wired-in, stationary computing. With a mobile smart device, producers can get information just about wherever they can get an Internet connection so they can be more responsive to customer needs and more productive for their business.
The concept of mobile technology and how it can benefit producers is convincing. However, for some to be persuaded something is good for them, they need more than a concept. A recent report from Ovum research, “Taking the Pulse of the North American Insurance Industry: Mobility Plans” indicates that 57 percent of insurance agents and brokers in North America have not begun implementing mobile solutions or have no plans to do so in the near future. That’s a staggering point when you consider the advantages mobile technology can bring to insurance producers and brokerages.
The insurance industry has historically been conservative with new technology. Those who are not yet sure how mobile tech will help them do business better need to see it in action.They need to see specific examples of how it will help them.
At a recent insurance conference, Applied Systems showcased its new product, MobileProducer. This mobile application for tablets gives producers access to their client data, as well as other mobile features that help them when they’re out in the field. When an agent at the conference asked about it, I gave him a demonstration. I showed him how he can view accounts, contacts and policy information from his agency’s system of record.
I told him about the GPS-enabled features, but he didn’t get the full-effect until I showed him what MobileProducer could do. I mapped out where clients were in a given area, got directions to prospect offices, and located nearby restaurants where he could schedule lunch or dinner meetings. And I showed him how he could get in touch with prospects through e-mail or instant messaging.
He let the demonstration sink in for a bit. Then he said to me, “You mean I won’t need to call my assistant to get a phone number or address when I’m on the road? I won’t need to call her at night when I see a client at a networking event and need to know what coverage he has with us?” “No,” I told him. “You will have all of this on your tablet. Quickly. Right at your fingertips.”
He said I made his weekend.
With mobile technology, you don’t need to rely on assistants or CSRs to relay information on the phone. It’s especially helpful at night, when you may not have anyone at your office to provide such information to you. That is the essence of mobile technology: making the most of your time, efficiently serving customers in ways they are accustomed to being served and increasing business productivity.
How are you using or planning to use mobile technology to increase efficiency, improve client service or improve business productivity? Join the conversation and share your thoughts in the comment section below.
Should insurance companies snoop in social media?
How long has it been since you checked your Facebook page to see who’s commented on your last post? A few minutes? A couple of hours? Facebook, Twitter, LinkedIn and now Google+ have become indispensible tools for communicating personally and professionally.
In the business arena, the insurance industry has embraced social media in getting the word out about products and services. But insurance companies have used social media for even more. They gather data from such sites to investigate claims and fraud. And they may begin to do so for underwriting.
Craig Beattie, an analyst for Celent, the research and consulting firm, said it’s now common for insurance companies to use social media for investigating dubious claims. Scouring individual pages may not be the quickest method of investigation. But companies are doing it nonetheless, he said, and are developing tools to conduct searches more efficiently.
And it’s legal for them to do it. Celent recently released results of a study titled, “Using Social Data in Claims and Underwriting : Creating a Social Risk Profile,” which delves into how insurance companies are using social media data and how consumers and regulators are likely to respond.
If you use Facebook et al, you might not realize what you have consented to in the terms and conditions of the sites’ privacy policies. Essentially, you might be waiving your privacy rights. So as soon as you post a status or photos, it all can be used against you–legally–if there is a claim to be investigated.
But when companies talk about mining data from social networks for underwriting, they’re likely to come under scrutiny for ethical and possibly legal reasons. How much data is a company really getting? Is it quality data and can it really be used for assessing risk and developing pricing? Is it going too far? Beattie said he hasn’t found any insurance companies who do it . . . yet.
What is your opinion? Should companies use social networks for underwriting and/or investigating fraud? Tell us in the comment section below!
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