When it comes to document creation and delivery—a key communications component to customer service--property and casualty insurers continue their uphill battle, notes a new research report by Needham, Mass.-based
Multiple document systems and templates, along with an inability to deliver document via multiple channels, continue to plague P&C carriers’ communications with their customers, notes Kristin Cressman, research associate in TowerGroup’s insurance practice and author of the report. “Service levels are diminished, and, in the long term, customer retention rates will be as well,” she states in the report.
It’s well known that, for a variety of reasons, print and mail continues to be the delivery channel of choice for P&C insurance carriers. P&C carriers face individual states' mandates requiring certain documents (personal auto policy documents, for example) to be sent only via mail, along with regulatory requirements that call for well-established proof-of mailing requirements via the U.S. Postal Service.
And, notes Cressman, although adoption of electronic delivery channels is vital to the growth of P&C carriers, it has been delayed by a number of other factors. Utilizing e-mail as a delivery channel poses a challenge due to requirements for proof of mailing. Plus, frequent e-mail address changes will hinder insurers’ ability to maintain this information for electronic customers and thus comply with proof-of-mailing requirements. Security concerns on behalf of carriers also confirm to carriers that the print and mail channel seem like the preferred choice.
In addition, P&C carriers have processed documents with legacy applications for the past 30 years. Despite the age of these applications, carriers tend to rely on legacy apps for specific functions such as high-volume batch document generation and because of their ability to process large amounts of data. To generate the four types of documents typically required (high-volume batch and event-driven, human-driven, and legally required) small and mid-tier personal lines carriers utilize up to three document systems, while the top 10 national carriers may utilize 90 or more document systems.
Changing those systems’ templates also presents a challenge. According to Cressman, P&C carrier's IT staff can take between three weeks and three months to create or update a document template, negatively affecting competitive advantage and corporate compliance. Implementation of a new document-creation capability can range from six months for a hosted solution to at least one year for an installed solution.
Meanwhile, notes Cressman, customers increasingly require electronic touch points with carriers via e-mail, mobile device, or self-service Web portal. “Customers nowadays also expect carriers to be able to serve them consistently in all channels,” she says. “A customer who chooses to pay a bill online and place a call to a carrier's call center in regard to a bill or policy demands consistent service across these channels as well as successful bridging back to a preferred channel.”
Cressman believes that a recent increase in consumer interest in electronic channels will drive carriers to expand delivery options and reduce their reliance on the print and mail channel.
“An important delivery channel for P&C carriers is the self-service Web portal, which enables greater control and compliance, alleviating proof-of-mailing concerns by confirming receipt of documents with records of customer sign-ins to the portal,” she says.
P&C carriers that invest in enterprisewide implementations of modern document technology applications will decrease their dependency on multiple document systems and on IT departments, notes Cressman. Equally important is the development of a strategy for multichannel document delivery and communication.
“These carriers will be best served by document technology providers that build partnerships with core systems vendors and enable document creation and delivery through new and emerging channels such as mobile and social media,” Cressman says.
