How carriers can get right with the gig economy

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A recent article in the Harvard Business Review highlighted results from a study focused on the emerging state of the gig economy and, in particular, the things which may define success for participants in this evolving definition of economic participation. This is certainly a timely study, coming as it does with only about 18 months remaining before the Millennial generation achieves another significant milestone: becoming more than 50% of the labor force in North America.

This is of course much more than just a study of demographics and economics; it will be increasingly important for insurance carriers to understand this phenomenon in order to be able to develop products and services that will remain relevant in the not too distant future. The idea that the products which were relevant to Baby Boomers and older Gen X-ers given the context of both work and financial options that were in play in the 1980s and 1990s having staying power into the third decade of the 21st-century seems implausible. Many of the products and services younger workers need for themselves and their families will be different, and they will seek capabilities from solution providers that truly understand those needs. The reality that insurance carriers need to recognize is that many of these needs will be driven by technology access and innovation.

As the study highlights, there are four key elements that need to be addressed as we evolve away from some traditional notions of work toward what might be described as vocations built around freelance activities. As articulated by HBR, this includes:

  • Purpose: Effectively this is the underlying mission or goal which helps define meaningful work and allows individuals to discern between good gigs and bad ones.
  • Routines: While this type of work can be dynamic and flexible, success in this arena requires developing regular routines to create a satisfying, productive, and effective work environment. Leaving the creativity to the work itself can require freeing mind-space from routine or mundane activities that produce low value outcomes.
  • Places: While a gig may imply working from anywhere, in reality there are specific types of environments that provide the requisite comfort and focus to allow concentration and creativity to flow.
  • People: We are social creatures, and while the work from anywhere, focus on the specifics of a “gig” combo may seem compelling, there’s a high potential for loneliness, which potentially limits the very productivity that people crave. If not organized by a traditional employer, other forms of social networking (e.g., associations, trade groups, etc.) may pick up the slack.

These insights, layered on top of the financial priorities reported by Millennials, should help carriers think about the “what” and “where” for engagement. Voluntary benefits and forms of worksite products seem particularly relevant. The technology platforms required to deliver here are notably different than both traditional Group and Individual solutions. Core capabilities and the nature of the user experiences become key because this generation has shown both a fickleness to things that may have made sense to parents and older siblings, and remarkable loyalty to the brands they trust. If Version 1.0 is way off the mark, Version 2.0 may not get much traction. Novarica’s research has highlighted the priorities for products and forms of engagement that support this notion.

The user experience can help define the “how” of engagement. While it is in vogue to talk about omni-channel experiences, recent personal interactions have shown that there are still many paper- and fax-based processes in place today. A recent conversation with a national footprint carrier confirmed that all their enrollment today is driven from paper-and-pencil-based efforts that would have been at home in the 1920’s. That won’t play well with consumers and workers born in the 1980s and '90s. In fact, much of our recent work-related innovation focuses on the importance of “systems of engagement” as a mechanism for disruption and disintermediation.

Hope is not a plan. Getting after this sooner, rather than later, may be a critical success factor as we roll into 2020. Focusing on that may not be optional for carrier IT organizations and the businesses they support.

This blog entry has been reprinted with permission from Novarica.

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Gig economy Sharing economy Digital distribution