It's still too early to crank up Lionel Richie and party all night long, but 2010 is looking much better for North American insurance eBusiness and channel strategy leaders. The financial markets have stabilized, and some insurers are even whispering the "g" word—eyeing small growth and new hires.
Every year I write an article on the key trends facing North American personal insurance eBusiness and channel managers. The article is somewhat predictive, but mostly prescriptive on what managers will prioritize for the remainder of the year. My timing may be a little slow since we’re nearly done with Q1, but our trends docs are a good reference point for the entire year.
We start by analyzing key macro drivers impacting North American insurers. Drivers are variables that managers cannot control themselves, but that can substantially impact the business. The most significant drivers this year include the recession, unemployment, and the continued soft market.
Then, we look at how eBusiness and channel managers will respond to these drivers. To do so, we interview personal lines and life insurance executives in the U.S. and Canada, use those results to benchmark against Europe, and analyze our own IT budget and consumer-spend information. It’s a solid formula to predict what managers will focus on. But I believe it's most helpful as a peer benchmark to ensure your strategic plan for 2010 is complete. It’s a foundational document managers reference every quarter to make sure they are still focused on the right priorities.
For many eBusiness and channel strategy executives, the story is déjà vu, with a focus on perennial issues like retention and channel conflict. eBusiness and channel strategy leaders aren't worried about their jobs, but they are focused on doing more with less. We believe eBusiness and channel strategy managers will wear even more hats with increased responsibilities for marketing, sales, service and emerging channels to remain competitive in 2010.
Some of the key trends we believe North American eBusiness and channel managers need to focus on for 2010 are:
• Integrating social media across all activities. North American insurers only beginning to invest in social media for marketing, sales or service are laggards—many firms began experimenting with social media as early as 2007. Social media isn't a fad for North American insurers any longer. Insurance eBusiness managers are integrating social media strategies across the enterprise for marketing, sales and service. Liberty Mutual Insurance's Responsibility Project led the way nearly two years ago with a focus on customer experience and branding contributing to Liberty Mutual's highly improved customer experience rankings. GEICO, Nationwide Mutual Insurance and USAA are using ratings and reviews to influence purchase decisions. Allstate's Vehicle Vibe community is trying to lower risk with driver education and safety tips. And Progressive Casualty Insurance effectively uses Twitter for customer service to update consumers in severe weather (e.g., the Georgia floods in September 2009).
• Developing mobile as a complementary channel. Most major U.S. P&C insurers have developed a clear mobile strategy, and firms like Nationwide have released multiple mobile phone applications for service. Nearly every major U.S. P&C carrier has an iPhone or smartphone app allowing self-service mobile transactions. Mobile channel strategies, led by eBusiness managers, will move beyond claims, customer service, and billing during 2010. eBusiness managers will use the mobile channel to integrate auto and home insurance into the car and home purchase journey.
Progressive's new iPhone app and mobile Web site allows noncustomers to view crash test results and recall notices when shopping for a car, and get a direct quote by phone for car, home, motorcycle or boat. Nationwide's Cartopia app for the iPhone and iPod touch allows any consumer to evaluate vehicle history scores, get prices from comparison shopping sites and rank vehicles on the criteria most important to the customer.
• Sharpening multi-channel customer communications. As insurers try to improve multi-channel customer experiences and service customers in their preferred channels, eBusiness managers are investing in software for document output for customer communications management (DOCCM). The software allows eBusiness managers to develop templates for all customer communications, including welcome kits, onboarding, renewal, policy changes and billing. DOCCM improves the accuracy of communications, and enables personalization and straight-through processing, keeping all transactions electronic and improving conversion for new business. Vendors like Adobe, Cincom Systems and Thunderhead help eBusiness managers improve customer experiences with consistent, personalized brand communications across all channels, including the Web, e-mail and mobile.
• Managing channel conflict with more support for agents. eBusiness managers are helping reduce channel conflict by creating Web 2.0 storefronts for captive and independent agents. Progressive partnered with Web.com to offer Web site templates and search-and-display marketing packages at reduced rates to independent agents. This lets customers receive online quotes while maintaining the relationship with their agent, and is a lead-generation source for agents. Many agents are already using social media like Facebook to build relationships with local customers. We predict that eBusiness managers at large and agent-based insurers will create integrated social media applications that support agents' lead-generation efforts while limiting risk with corporate social media guidelines.
• Using e-signatures for multi-channel interactions. Electronic signatures (e-signatures) have been gaining traction among P&C and life insurers as firms continue to improve multi-channel transactions. E-signatures help improve ease of doing business with agents who use e-signatures to close new business in person, online or over the phone. E-signatures enable straight-through processing, which helps eBusiness managers reduce costs and improve sales conversion. Vendors like eLynx and Silanis allow eBusiness managers to authenticate new customers across all channels, keeping all transactions electronic. A typical life insurance application could take months to complete with paper-based transactions and paper signatures. E-signature platforms are valued by eBusiness managers for their security, cost reduction and improved automation. eBusiness and call center managers will continue to work with IT to enable e-signatures through the Web, call center and even mobile tablets for in-person agents.
Do you agree or disagree?
Chad Mitchell is a senior analyst with Forrester Research. He covers mobile and social media strategies in insurance, acquisition, cross-sell and retention marketing strategies, comparative raters, online guided selling tools, emerging Web and call center technologies for sales and service, agent portals for marketing and underwriting, and the best practices of leading multichannel firms. Additionally, he advises leading insurers on best practices for public and secure insurance Web sites—analyzing functionality for quoting, policy administration and claims.
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