How and where do customers want to do business? This question is plaguing insurers. As one formidable generation grows older and a new one comes of age with completely different lifestyle and purchasing habits, insurers are slowly realizing that they’ll need to abandon traditional business operations in order to keep up. But how do they do that when their new consumers are so drastically different from those they’re used to doing business with? To solve the enigmas that next-gen consumers present to insurers, data is proving to be the path to concrete answers.

Indeed, as younger generations overtake insurers’ radars, they will represent a foreign species—raised online, in an environment insurance executives are still becoming acquainted with. Being a specialty insurer with a mostly defined demographic, Jewelers Mutual Insurance Company started its quest for better customer experience with a bit of a head start.

“Typically, [the company’s policyholders] are early to mid-20s, much more deft in the use of newer technologies, and really want to have the control in their own hands,” says Jared Ashland, Director, Architecture and Integration Services, Jewelers Mutual. “So we’ve started down the path to self-service, and the platform we’ve built will enable us to add more features and capabilities as they’re demanded.” With the more tech-savvy generations in mind, the company decided to make a big investment in customer experience a few years ago, and only recently finished implementing Guidewire’s Insurance Suite, which involved the deployment of new billing, underwriting, claims and policy administration systems for Jewelers’ personal lines.

With this new platform, the insurer expects to reach customers in real time before they have a chance to forget about insuring their purchase. “Most of our customers are in the bridal market or newly engaged and have plenty of other things on their mind, and when they leave that store, insuring their investment becomes an afterthought,” Ashland says. So if they just want to make sure it’s insured and take the deductible, they can have it insured before they ever step out the door with it.” This goal is ambitious but simple, aligning with basic personal lines demands sure to be found among its typically younger consumers: real-time interactions with mobile and online offering a high level of self-service.

Although the deployment is now finished, Ashland asserts that this was only the first step, as there is still much for Jewelers to learn about reaching its personal lines customers. The company asserts that its underlying motivation for the purchase was to build a strong foundation for gleaning customer experience insights and acting on them quickly.

This long first step is a required leap of faith for many insurers. Many are becoming aware that they need to become as user-friendly as possible and anticipate the wants, needs and questions of new, unknown generations of consumers. This presents a fundamental shift in how the business is conducted and maintained needs to take place, a shift that, Ashland points out, puts consumers utterly in control and leaves insurers depending utterly on their foundational technology to deliver insights gleaned from customer data and enriched processes.


Robert Cummings, head of SAP’s insurance business was recently privy to a conversation between insurance executives that coalesced when they determined the “three biggest challenges they see coming up in the future: customer, customer and customer.”

Cummings encapsulates this “sea change” in the insurance business by explaining how a Taiwanese insurer shot to the top of the market in less than two years after being bought from somebody outside of the insurance industry. The problem was that the insurer was avoiding contact with customers—a business tactic that correlated with the old way of conducting business, Cummings says.

“[Avoiding customers] was actually easy when brokers or agents took care of all that, but now that it’s easy for customers to switch carriers and users are becoming much more sophisticated, this makes it easy for carriers to lose touch with their customers,” says Cummings. “The next generation coming is not used to working with middle men but instead going on their social network and saying, ‘ I just bought a car, do you guys have any suggestions of what insurance I should pick?’ It’s terrifying insurers actually.”

The company, to make sure it was staying in touch with customers in an nonintrusive fashion while preparing itself for the most important customer interaction, the insurer started initiating test claims for every customer once a year. To both ends, customers felt reassured that they would be taken care of should the worst occur, and insurers prepared themselves for the most critical and decisive touch point, which is especially important given the fickle nature of the next generation of consumers.


As the assumption that customers want direct contact with insurers and little interaction, the question is often then asked: Are agents and brokers being replaced? To which the answer invariably boils down to: No, brokers and agents are not going anywhere, they’re adapting, and some of their activities are being replaced.

For with that convenience and lack of human interaction/advice that customers are demanding comes several dangers that insurers need to be accountable for if they want to retain customers—such as naïve consumers unknowingly making bad purchasing decisions and claims processes feeling cold and impersonal.

“In my parents’ generation, you went to an agent, you talked about what it is that your needs were and your agent would tell you what to look into, and so the agent played a central role in connecting consumers with insurance carriers. But at this junction in time, consumers don’t want to talk to an agent,” says Samir Ahmed, analyst, X by 2. “How to connect the consumer with an agent is not as a sales agent, but as an advisor, like a consumer advocate.”

In other words, consumers still need help, but they don’t want the self-service process to be interrupted, which means agents—or consumer advocates—need to be inserted into the process subtly, fluidly.

For an example, Ahmed also turns to the claims experience. “After an accident, big or small, consumers are usually thinking, ‘I don’t want to report this in an agent’s office. I’m going to go home. When I’m calm and in a comfortable environment, I will inform you guys that this accident happened. Here’s the police report for it, here’s some pictures I took. Here’s where I want to go get my car fixed because I trust this body shop.’ And they want to be able to do that and go through the approval in a smooth way.”


To enhance the claims process and provide a slick platform for agents and brokers to get behind, some insurers are turning to the dynamic capabilities of mobile devices. SAP’s Cummings uses a generic example of how a claims process could be carried out with a rich insurer app: “When in an accident, an app can ask if you want to connect with someone at the call center. After speaking with someone, you can use the camera show them the site, etc. And then talk through the next steps; from there the order gets placed and it captures the location so the insurer can move quickly in contacting a nearby tow service.”

This is an innovative example of mobile’s dynamic functionality and how it can improve key touch points and customer experience services. Yet overall, insurers are still befuddled by the new devices and how to make them work for the enterprise, according to Jean Lassignardie, chief sales and marketing officer, Capgemini. He says his company recently asked more than 100 insurance execs for their thoughts on mobile, and while the vast majority said mobile is critical and that developing a mobile channel will become increasingly important, almost all of them were also still unsure how big a role mobile will play.

“Moving forward, it’s critical to have a better understanding of who your customers are. Until you have that, it’s going to be very difficult,” says Lassignardie. “Do you need to have everything on your mobile or are there only certain pieces that are most important for the client and they can get the rest through other channels? It’s a matter of understanding what roles it will need to play.”

Early research from Forrester, titled “The State of Mobile Insurance in 2013,” attempts to answer a couple of questions insurers might have about younger, more tech-savvy consumers. The survey results outline the average U.S. customer that wants to use mobile for insurance, as well as pinpointing when in the process policyholders want to use their mobile devices—claims, policy viewing and bill paying at the top of the wish list. (Click here for an infographic included in our latest issue illustrating more mobile preferences found in the report.)


Yet, while your typical mobile-savvy consumer can be broadly defined, the rapidly changing preferences and desires of that consumer are what really scare insurers. This means that the problem of the customer isn’t going to go away, and it’s not going to crystallize without serious investments of time, resources, money and probably a few tough lessons. Therefore, real-time adjustments and rapid-fire product development need to be top-of-mind when insurers are making investments.

This quickening pace is the reason Jewelers emphasized agility as well as complimentary technology that prepares them for the deluge of data they will need to sift through to stay on top of customer demands. “It’s one of the things we need to get more adept at is collecting all that data, from a claims and billing perspective. We’re like most other insurance companies where we’re trying to move toward improved data analytics, data capture and how we leverage that data to improve,” says Joel Matthies, CIO of Jewelers.

The one area that most insurers already track is claims satisfaction, according to X by 2’s Ahmed. “Claims satisfaction is a very key benchmark of how well a carrier is performing, so they pay attention to some of the data and they are starting to hear these demands and realizing that they need to make investments in their technology infrastructure to enable the business to provide or meet these demands that consumers are making.”

Claims insights may spark initial investments, but the more data you have on the consumer, the more educated your investments can become in the future, according to Lassignardie, who warns insurers that they can’t wait around until a catch-all data solution or mobile platform presents itself.

“It’s realizing you’re not going to be able to be everything for everyone. Collecting data and information around your customers and knowing what their needs are is a critical stage—having that understanding of what your target segment is looking for and balancing that with how your firm is currently positioned and what your current differentiators are and aligning your whole strategy,” says Lassignardie.

It may be overwhelming to think of all at once. Luckily for Jewelers, they had long-term goals, including agility and customer analytics, in mind when signing on for their core systems modernization, which means, after a few years and multiple investments, the company is ready to go beyond their basic understanding of the consumer.

“We built the enterprise data warehouse at the same time we did the Guidewire implementation, so now we’re really capturing a lot of the information. We’re continually looking at what we can add to it so we can start looking at that information and making better decisions,” says Ashland. “But really, it gets back to just making it as easy to do business as possible.”

(The Statistically Speaking section in our latest print issue of Insurance Networking News highlights consumers’ mobile preference and presents the typical mobile consumer.)

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