Mobility will impact business as much as or more so than the Web did back in the late '90s. This is what 73 percent of 400 global IT executives representing a variety of industries, including insurance, said in a report from Accenture. And, mobility is a top-five priority for 42 percent of CIOs, and will generate significant sources of new revenue, according to 79 percent of CIOs in "The Accenture CIO Mobility Survey 2013."
So where do insurers fall in these statistics? And, how do the P&C, health and life sectors compare to each other?
Reports over the past year from a number of insurance industry research and advisory firms show that mobile is an area of focus for insurers. According to Novarica's "Mobile in Insurance Beyond Personal Lines: Current Trends and Expectations," more than 60 percent of 79 insurers (17 life/annuity; 62 P&C) surveyed iniearly 2013 are planning to deploy additional mobile capabilities this year. More than 70 percent of property/casualty respondents plan on adding new mobile capabilities in 2014, whereas for life/annuity insurers, the number drops back down to around 50 percent.
Agents and brokers are expected to benefit from some of those future investments, as more than half of the life/annuity respondents and 40 percent of P&C respondents expect to deploy agent/broker capabilities by the end of the year, and more than 70 percent of both groups expect to do so in 2014 or later. More than 30 percent of these P&C insurers expect to deploy mobile capabilities for claims adjusters, field marketing reps and underwriters by the end of this year.
According to Forrester Research, agent-based companies have been as quick as direct insurance companies to develop mobile offerings, with apps that help customers find agents and apps that help agents serve their customers better.
This surprised the firm's principal analyst Ellen Carney, who co-authored the report, "The State Of Mobile Insurance In 2013." Also surprising, in almost every insurance line, U.S. companies are ahead of their peers in other regions - UK, Australia, Canada - especially in P&C auto, where quoting functionality is becoming common in the United States but remains rare elsewhere. The changing health environment - with major reforms and rising medical costs - in the United States also drives U.S. health insurers to focus on the potential for mobile to influence customer behavior or help customers with mobile tools to help keep them healthy. And in life, many insurers, particularly in Europe, have only made half-hearted investments or are waiting on the sidelines to see how mobile insurance develops, while in the United States, Prudential and SunAmerica offer some, but not much, mobile functionality for their life products, Carney says.
For its report, Forrester examined the mobile apps of more than 30 insurance companies worldwide, and found that leading digital insurance teams are using mobile apps to take advantage of phone hardware features such as cameras and global positioning system (GPS) locators to offer a wider range of functionality. Accenture's findings echo the importance of locators. The insurance industry respondents cited location-based services (48 percent) as most important on their list of needs.
For P&C insurers - the sector that has been the fastest to embrace mobile opportunities - Forrester's Carney says this is a must, as is a basic claims-tracking functionality. "Insurance consumers aren't contacting their insurers every day, except when there is a claim," she says. "Insurers should model their claims-tracking functionality after the Domino's Pizza Tracker, which shows customers where in the process the order is." This can be done for the claims process; show the customers where their claim is in the process.
The life insurance sales process is much more intimate than in other sectors, Carney says. Therefore, these insurers should focus on mobile for agent enablement. In her report, she points to Israeli insurer Migdal, which developed a series of online and mobile tools that give independent agents information such as the most recent policy data and interactions with a prospect or client.
Health insurers do a good job with consumer-facing health information and management apps to influence customer behavior or help keep customers healthy. However, health insurers are faced with a rapidly evolving market as a result of the Affordable Care Act and insurance exchanges. "Consumers are set to do something completely different in the way they buy insurance," Carney says. Consumers will shop on price, so while claims status is important, the beginning of the sales process becomes even more important, and insurers will need to offer sophisticated selection tools, she says.
What's common among all three sectors is the challenge of mobile governance, Carney says. "The technology is there, able and reasonably priced," she says. "The lack of mobile governance is what's holding back insurers."
Insurers need to address this governance challenge (See "More Mobile Governance"), because customer expectations are rising fast, leaders are making substantial investments and the time required to build infrastructure, skills and expertise means that laggards won't be able to catch up fast, Carney says.
Property/casualty insurers lead the way in mobile sophistication and advancement, especially in consumer-facing offerings. According to Deloitte's "Insurance Tech Trends 2013" report, many U.S. P&C insurers, such as GEICO, Nationwide Mutual Insurance Co. and Progressive, began investing in mobile years ago and continue to stand out for their commitment to it, enabling consumers to obtain quotes, file claims, pay bills and even save documents simply by taking pictures with their smartphones.
But recently, internal and partner-facing mobile applications are receiving strong interest, Deloitte says, particularly when it comes to e-procurement, to be used in conjunction with property, auto and physical damage claims adjusting. These apps enable adjusters to immediately order replacement parts and request services for the customer, such as towing or repair, making the claims-handling process more efficient and eliminating transfers of money with the customer. Payment is handled directly with the goods or service supplier from the insurer.
At present, just two platforms, iOS and Android, account for the bulk of frequent mobile Internet users in most countries, according to Deloitte. The Windows 8 platform does not have a lot of adoption. While this may be true for consumer offerings, the need for Windows 8 may be stronger in claims adjuster offerings.
One such insurer focusing on adjusters is Mutual of Enumclaw. While the insurer introduced its mobile app for consumers three years ago, as part of a larger enterprise content management effort, in April it began its adjuster efforts by piloting Hyland Software's OnBase Insurance Field Adjuster app. The mobile app is designed for Windows 8 and attempts to give claims adjusters instant access to the data and documents they need, enable signature capture on electronic forms and even uses the native device camera to capture photos to streamline the claims process. The app consolidates Mutual of Enumclaw's field adjusters' workflow onto a single mobile device, enables adjusters to share electronic content real time in a flexible mobile environment and enhances the claim assigning process, says Michael Rasmussen, regional field claims manager at Mutual of Enumclaw. "It offers an automated hybrid decision and rule-based model that is essential to our business needs," he says. "Using the mobile ECM application means there is less manual activity to get documents into the system. It eliminates tasks involved with back-office processes such as scanning, indexing and e-mailing to move processes forward faster. As [the adjusters] continue to use the app they expect to get a better understanding of how mobility will continue to affect business, become more efficient and put a personal touch toward better interactions with customers."
Rasmussen and David Wilson, CIO at Mutual of Enumclaw attribute the success of the project, which began late third quarter of 2012, to being able to experiment throughout the implementation and piloting period. "We were able to learn how mobility will work in the field and really improve the process," Wilson says. "Hyland representatives took to the field with us and the adjusters to find out what they needed and were able to make changes to meet those needs. The most important thing we learned [during the process] is to experiment when you can. Be open to the possibilities."
In the health space, in particular, there appears to be a widening gap between those companies that are building toward a disruptive endgame, and those struggling to adapt the technology beyond the basics mentioned above.
Derek Newell, CEO with Jiff, a company that specializes in mobile and digital health developments, speaks with health insurers regularly to discuss their mobile operations, but says that between justifiably conservative legal teams and disparate back-end systems, most companies are content experimenting with a partnership or with building in-house before the proper foundation is set.
"Many health insurers are the product of a bunch of mergers, and in some cases, they haven't even tied that back-end infrastructure together. It's all bandaged and duct-taped together in the background. It's hard to create a seamless mobile experience when your back-end systems are a mess. I think they're all aware that they need to do something, but when it comes to knowing what they need to do, there are big gaps between the different insurance companies," Newell says.
One of the companies that Newell cites as understanding the mobile game is Aetna.
Indeed, Wendy Wahl, executive director of digital marketing and operations for Aetna, gets very excited to talk about the disruptive potential of iTriage, the health insurer's mobile app.
"It can help you understand what you need to know, get you the information you need about your symptoms." Then from there, the point-of-arrival experience becomes even more immersive.
"It allows you to understand what you need to know and look up on a member payment estimator - a tool which will eventually be a part of iTriage - how much the treatment will cost with doctors that are in your network, or out of your network. It will give you lots of different options and direct you to the one that's the closest, the one that's the least expensive for out-of-pocket costs, and it'll have customer ratings for the doctors," Wahl says.
While it doesn't have that type of immersive customer experience available for every plan sponsor today, that is the company's goal, which Wahl says is only a matter of time. To get to where it is now, the company has had to tackle one technical challenge after another, which mostly involved organizing policyholder data in an accessible, dynamic fashion in the company's back end. For the most part, this was handled in broad strokes as the insurer put together a series of individual tools, such as the member payment estimator and DocFind, a stand-alone tool designed to enable users to look up nearby doctors and clinics and indicates when they are in-plan or not.
The two tools are now coming together to provide policyholders with the type of start-to-finish, as-you-need-it experience consumers have come to expect from their mobile devices, Wahl says.
When asked how long it had taken to get these individual tools up-to-speed and communicating effectively with policyholder data in the system, Wahl simply says: "Years and years and years."
The inroad for mobility in the life insurance space, on the other hand, is harder to find, as their policies are often set aside and forgotten about, with the exception of updating beneficiary information or filing related claims, i.e. dental, vision, etc. Thus, the impetus for investment isn't quite as high as in the P&C and health sectors, nevertheless, there are a few ways that the technology is being used.
"One is on the sales front, providing agents with tools that they can take on a tablet to a client and pull up a calculator and walk them through what potential payments would look like, what potential benefits would look like," says Samir Ahmed, an architect with X by 2, explaining that some companies are slowly replacing laptops. "The advantage for the carrier is that they can centrally host the software, update it once and everybody gets the most recent information without delays."
"For life insurers, [mobility] probably falls into the realm of making things more efficient, making things make more sense or providing better education, but it won't necessarily disrupt to the point that you get a whole new business model," says Amy Friedrich, who is the VP of Principal Financial Group's special benefits division and recently oversaw the update of the company's group life mobile application, which is now designed to enable the submission of vision claims and the ability to check group disability and group term life insurance policies.
"So when we look at things like dental or vision, there's sometimes a network in place and there's an ID card that you have to take to providers; with those you can really change the nature of your relationship with mobile technology," says Friedrich.
Also, Principal has found that what it has offered as competitive advantages with life insurance packages in the past — value-adds that provide policyholders with access to extra information and programs — are often forgotten about as policies are set aside. In the case of workplace life insurance, the employers who are selecting which carriers to work with may understand where this extra value can be gleaned, but the policyholders are rarely aware.
"Travel assist is one of those things that is a value-add; if you're going to go out of the country, you can get a safety and security checklist," says Friedrich. "For those things that are harder to communicate to employees, we're really finding mobile apps useful, for the people who are interested in them, to get them quickly and efficiently."
But even with the new announcement, discussion over data security practices continues to provide tension within Principal.
"It's a constant discussion we're having, that push and pull between how easy you can make it and how secure you have to make it," says Friedrich of the app, going on to explain that in order to get to the app, which is designed for usability, you first have to establish credentials through a Web browser. This provides users with an extra step in the process, but Friedrich says, "If we're going to err on one side, we're going to err on the side of protecting information."
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