How agents and brokers are using insurtech

Transcription

Transcripts are generated using a combination of speech recognition software and human transcribers, and may contain errors. Please check the corresponding audio for the authoritative record.

Headshot of Allison Arzeno of Assurance IQ.

Patricia Harman (00:06):

Welcome to the Dig In podcast. I'm your host Patti Harman, editor-in-chief of Digital Insurance. Insurance technology is transforming the industry in a variety of ways. It's helping agents, brokers, and insurers manage large amounts of data, create more accurate pricing and products for customers, and it's helping to expedite many aspects of the insurance process from underwriting to sales to claims, and it's also creating new job opportunities and changing how those in the industry interact with their clients and customers. Joining me today to chat about how insurtech is helping agents and consumers and how it's impacting the entire insurance process is Allison Arzeno, CEO of Assurance IQ, a direct to consumer insurance platform that leverages data and technology to help people navigate the process of finding and choosing insurance coverage. The company was launched in 2016 and has over 2,500 agents. Allison is also a data scientist and can share how data and machine learning are changing the insurance industry. Thank you so much for joining us today, Alison.

Allison Arzeno (01:23):

Thank you for having me.

Patricia Harman (01:25):

So February was insurance jobs month, and I was wondering if you could start with just sharing your story of how you got into the insurance industry and the different roles that you've held before becoming a CEO.

Allison Arzeno (01:38):

Yeah, definitely. So as you mentioned, Patti, I am a data scientist by training and I was pursuing two different paths as part of my career. One was around really helping businesses understand how to use data and analytics to strengthen their business. I taught at several business schools helping to inspire various MBA students to use data and analytics in their careers going forward. And I also was very attracted to the startup space and a lot of different tools and businesses that were being built, leveraging data and analytics to improve people's lives. I predominantly was focused in the healthcare space, but one of my good friends, Mike Rowell, reached out to me who was a co-founder and our first CEO at Assurance IQ and told me a bit about their vision and what they were building at Assurance and the vision that they had of using technology and data science, leveraging agents and the workforce and the human touch that agents can provide to help mass market consumers navigate the insurance process and ultimately save money, find better plans and live healthier lives and better financial lives was a mission that really resonated with me. So that brought me into Assurance IQ. I started out as the chief data scientist here at Assurance and have come into this role from that.

Patricia Harman (03:13):

Wow. How did you even decide to focus on data science? And then I'm wondering what kind of job opportunities does that field provide, especially for young women because we hear so much about STEM programs and how important they are. So I was wondering if you could address that a little bit.

Allison Arzeno (03:32):

Definitely. So I was actually originally attracted to a field called Operations Research and the tagline for operations research is the science of better. And the idea is using mathematics, analytics, machine learning, optimization, all of these tools to improve businesses, improve society, make lives better, and coming out of college, that was a mission and a purpose that really resonated with me and still does today. That's how I got into the field. At the time, data science wasn't really a word that was used. Now I would say operations research and data science are very similar, but for me as a young woman who was very passionate about mathematics and loved mathematics, I really wanted to impact the world in a positive way. And I think that is something that resonates with a lot of young women is loving this technology and these tools that you learn about in school, but also wanting to have an impact in society, impact on the world. And in that way, I think data science is a really compelling field because of the applications you can have, the variety of industries you can go into. There's a lot to really love about data science,

Patricia Harman (04:48):

Insurance technology has advanced significantly over the last decade. Are there areas of technology that you're watching at this point, like artificial intelligence, machine learning, all of those types of technologies now?

Allison Arzeno (05:04):

Yeah, definitely. So I would say at the most basic level, just the sheer amount of data that is available in the insurance industry is really compelling and some of that data is more recent and some of that data goes back decades when we think about various insurance companies, they've been collecting data and using data for quite some time, but now we have the ability to take all of that historical data and do some really interesting things with it when it comes to building better products for consumers, better experiences, really learning from that deep and rich history. So at the most basic level, something that excites me is just the depth and breadth of data in the insurance industry. The other area that is exciting me right now is everything that's going on in the generative AI with LLMs and a lot of the new tools that are out there to really customize and personalize the use of AI for individuals. So in the insurance industry, we've been trying to find ways to leverage chatbots, some automated voice software like IVRs for quite some time, but they can be kind of clunky. Often they don't really understand your question or answer your question well, and this is an opportunity for us to really leverage AI in a way that improves the customer experience on your path to ultimately talk to an interface with a licensed expert human agent. And that in many ways is the approach that we're taking at assurance.

Patricia Harman (06:45):

It's been really exciting for me. I've covered the industry now for probably about 15 or 20 years, and insurance always had this reputation of not being on the cutting edge of technology, and yet when you look at what's going on in the industry these days and how they're able to use all of these different types of technology, it really is very exciting. And I'm wondering which innovations do you think are going to have the biggest impact on the insurance industry and why?

Allison Arzeno (07:15):

Yeah, I do think a lot of what we're seeing with the, if you have experimented with chat GPT and seeing how it really can feel like you're having a human interaction in the way in which it answers your questions, the way in which it pulls data from various sources, I think that is going to be a really interesting development for the insurance space. I don't believe that it will replace licensed agents in insurance. At the end of the day, I do believe humans more deeply trust other humans, and you really want to know that somebody is caring for all of the small nuances and details of your personal experience, your personal life, but these technology tools can help make that experience more efficient. It can serve as kind of backup to say, Hey, here's what your licensed agent is advising you to do, but here are all of the resources and references that backup up that recommendation. And so that's the combination of the human agents with what this technology can do. It's that intersection that I'm the most excited about.

Patricia Harman (08:28):

I agree. Insurance has always been very much relationship driven and I think that that is going to continue even as we bring in all of these new innovations and new types of technology. Are you finding that there are particular areas of the insurance industry that are adopting technology may be a little bit more quickly than others?

Allison Arzeno (08:50):

We've seen a lot of InsureTechs as they are referred to, or fintechs come to life over the past decade, and those companies and initiatives are really focused on leveraging technology quickly in this space. So that is an obvious place, I would say, when it comes to underwriting and the way in which underwriting is being done. We see that as a place that is leveraging technology and data at a really deep level across all different verticals in the insurance industry and it is often happening behind the scenes. And so it's a little less obvious to your average consumer, but there's a lot of really interesting work going on in that area as well.

Patricia Harman (09:36):

I would completely agree with that. As we're looking at the increased adoption of technology in the insurance industry, there have been concerns about it eliminating some jobs or really impacting them significantly. Is this a real concern and what are you seeing in this space?

Allison Arzeno (09:57):

Yeah, I really see technology in some of these new tools as a amplifier for our human workers. So whether we're talking about a licensed agent or a financial analyst or an actuary or even a data scientist, I view these tools as ways for that person, that human to really be able to focus on what they do best and let technology take over the stuff that it does best. So it's really that combination of how do we leverage both sides to produce a better result? That's what I see happening in the future. For the most part, the jobs will still be there. They might look a little different because we can now use these tools that enhance productivity, take some of the heavy lifting away from the human worker, but I strongly believe the jobs will very much be there and hopefully will look even more attractive than they have in the past,

Patricia Harman (10:58):

I think so, I agree. It's funny because I write all the time and now when I'm writing, all of a sudden AI is suggesting the words I should use or what I should do. I'm like, Ooh, okay, so maybe you won't need me in a couple of years. And then it's as much as people think journalism is something that's really easy to do, you still need someone who's going to be able to take that information and synthesize it and really kind of put it together in a coherent way. And hopefully AI will not be able to do that anytime soon. So what are some of the benefits of technology adoption and how is it really changing the customer experience now?

Allison Arzeno (11:40):

Yeah, so one way I think it's changing the customer experience as I mentioned earlier the ability to use AI and technology to quickly pull references and aggregate information. I think that is really critical piece. So if we zoom back 30 years and think about what search engines and tools like Google did for us, it opened up this world of information that we could access really quickly. Now when you think about what gen AI and some more recent tools do, they're accessing that same information, maybe even more information, but aggregating a response and putting together a response that's even more digestible now instead of having to go through pages and pages of search results, we get that even summarized for us and make it even easier. That is a very similar example to what I'm seeing is possible in the insurance industry. It used to be that you would go talk to one agent, you get one say life insurance recommendation, you get one packet for that particular policy and that's what you buy.

(12:53):

Then we had our world opened up where it was easy to see the dozens of different options that are available to you for life at the moment. So now instead of only getting one option, you're talking to your advisor or agent about the dozens of different plans that are available to you. Now I'm seeing as a next stage in the consumer experience, how do I digest and synthesize these dozens of different plans in a way that's easy to understand, that is deeply personalized to who I am and makes it so that not only can I buy a great plan for my personal needs, but I can feel confident that I use the right tools, got the right information to know that that truly is a great plan for me.

Patricia Harman (13:37):

And the advantage to using the AI is that it allows them to bind these policies that have been tailor-made for a particular individual. It allows them to just bind them so much more quickly so that you're not waiting weeks and weeks, but it can be a matter of minutes or hours at the very most. So I'm wondering, are there ways for insurers and brokers to effectively blend technology adoption with that personal expertise to create a better experience for both the employees and their customers? And then would you share how you're doing that at Assurance IQ?

Allison Arzeno (14:16):

Absolutely. So one of the things that we do at Assurance IQ is provide digital tools for consumers as well as the ability to talk to a licensed agent. So we have hundreds of articles on our website where consumers can go, they can read about different attributes of plans, different situations, get some of their questions answered, they can browse quotes and different options available to them. They can then talk to a licensed agent to get some more personalized help to talk to a human, to really go through some of the nuances of the applications, and then they can jump back to the digital experience as well and really think about it longer, read about the plans in the comfort of their own home and then call that agent up again when they're ready to finish their purchase or if they have other questions. So this seamless interaction or bouncing back and forth between digital tools, self-serve tools, but also the help of a licensed agent is something that we've spent a lot of time thinking about at assurance. And I truly believe it's that integration, that seamless integration of using technology, knowing that you have that human expertise at your fingertips to help you if you need it. That's of critical importance to the consumer we believe, and something that we're putting a lot of effort into at assurance.

Patricia Harman (15:40):

It really kind of gives you the best of both worlds because you have the ability to do the research and kind of figure out what do I need? And then you also have the opportunity to talk to someone because I think a lot of times we don't realize what we do or don't know until we've started talking with someone about something saying, oh, well what about this? Or they might say, well, based on what you just said, you also might want to consider this type of coverage. So I really like the way that it kind of blends everything there. And I'm wondering, as you've kind of automated more based on your experience, how are consumers adjusting to the increased use of technology as part of the insurance process?

Allison Arzeno (16:22):

So we see a lot of appetite and interest by consumers to start their experience digitally. So we see tens of thousands of consumers on our websites every day who have seen one of our ads or heard about us online, and they come to us. They provide some basic information so that they can get a quote and a recommendation for the type of insurance they might need, whether it's health insurance, life insurance, or our auto and home insurance. And then they can explore and think about those plans a bit more or connect with one of our licensed agents on it. And the piece that I find the most interesting is that people really like doing that shopping online on their own time with technology, with digital tools. So whether we're talking about a 65-year-old Medicare consumer or a 27-year-old term life consumer, the interest and appetite for digital shopping is there across the board and continuing to grow.

(17:36):

But what we also see is that a lot of people then want to transition to a human agent at some point in their experience and know when they're actually paying money for this insurance policy, this thing that's going to improve their financial livelihood, but also costs a reasonable amount of money month to month, or has the ability to change their experiences, change their financial profile. They just want that extra comfort of human help. And so I really see a lot of appetite for consumers to transact digitally, interact digitally, shop digitally, but they don't necessarily want to do everything digitally. And that's really our mindset and approach is how do we provide those hybrid experiences to consumers because it seems like that's what they want.

Patricia Harman (18:31):

Yeah, I would totally agree with that. I'm wondering, I said at the beginning of my intro that you have about 2,500 agents. Are they spread across the country then?

Allison Arzeno (18:43):

They are, yes. So all of our agents work fully remotely. We have agents in almost every state in the United States, which is great because it allows them to expand their reach. A lot of in-person face-to-face agents really only serve their immediate community. Agents who work at Assurance IQ can serve consumers all over the country depending on wherever they're licensed. Now, sometimes an agent will be more likely to be licensed in the state in which they live or surrounding states. And so they happen to interface more with those consumers, but it really opens up the ability for people to get help from somebody who might be better suited to help them with the particular products in the particular state that they're living in.

Patricia Harman (19:33):

Yeah, that makes a lot of sense. And since everything is kind of digitized or is more remote, is it making it easier for consumers to purchase coverage while kind of being educated about their exposures at the same time? Are you finding that blend of autonomous versus in-person or the virtual as well as being able to reach out to a person is working well for the policyholders?

Allison Arzeno (20:05):

Definitely. So one of the best examples of this I think is our Medicare line of business. So we sell a lot of Medicare Advantage plans and a lot of consumers that we're working with live in rural areas where they might not have access to a local advisor or insurance agent. And even if they do that local advisor agent might not have access to as many plans as we do on our platform because the average Medicare consumer has about 40 different plans that they can choose between when it comes to picking their Medicare plan, which is huge and a lot of different options for them. And so by being able, wherever you live, wherever you are, you can reach out to us and talk to an agent and get a similar experience. I think that's huge for a lot of these consumers and really understand, okay, based on where I live and my particular situation, the healthcare services that are accessible to me that I can drive to, that I can get access to what really is the right plan for my personal needs. That is something that we find is really powerful for consumers that end up interfacing with us at assurance.

Patricia Harman (21:31):

That opens up a whole new world for them and just a myriad of possibilities in terms of finding that really specialized and tailored coverage for them. So how do you think technology is going to continue to change the insurance process going forward?

Allison Arzeno (21:50):

I do think we'll see more and more consumers wanting to do more and more of their insurance buying process digitally. So right now, as I mentioned, most consumers are eager to shop digitally to look at quotes digitally, to interact digitally. I think we'll see a continued shift where more people are comfortable doing that full transaction digitally. I don't think the need for human support will go away anytime soon. That support might just be more post-purchase. Maybe you've decided to purchase something, but now you have questions about it or you're wondering if you really made the right choice. How do you have that human support that you can talk to say, Hey, I bought this one product, but now I'm wondering if this other one is better. Can you talk me through that? So I do think we'll continue to see more and more shift to be a digital experience for consumers.

(22:50):

And I also think that we talked a bit earlier about underwriting and how technology is coming into play there to make things better and different. I think we'll continue to see a lot of product innovation in the insurance space as we have a lot of data. As consumers demand more and more personalization, I do think we'll continue to see interesting products, products that are really customized for individuals based on their needs, based on their situation. And that's just going to amplify the amount of choice that consumers have and really drive even more need for technology to help consumers navigate that choice. So I think we'll see a lot of goodness for consumers. I think it will enhance complexity in some ways, but the use of technology and new tools will allow consumers to really navigate that complexity well,

Patricia Harman (23:45):

I think so it's been interesting for me. I feel like sometimes I get the 10,000 foot view of the industry and I can see what a lot of different companies are doing, and it's been really exciting for me to see the innovation that's going on across the board. People have absolutely no idea, and I think that insurance is going to change a lot. I think it's going to become a lot more proactive in terms of preventing things from happening as opposed to always having to react because of some sort of flood or fire or something that happens. There's just so much technology out there that's changing the way people are going to interact going forward. And with all of this technology implementation, do you have any concerns about how some of the technology, like large language models or IOT devices and some of the exposures that their use can create?

Allison Arzeno (24:43):

I do think we need to be aware and critical of those concerns. So at Assurance, we have an ethical AI committee that is a cross-functional team of folks from our technology department, data scientists, compliance and legal team members who come together to really ensure that what we're doing with models and machine learning and technology, the way in which we're using data is being done in a way that helps consumers, that protects them, that gives them better choice and better tools. Broadly, when it comes to data science and using data, we have to be careful that the biases of the past that might come through in that data aren't being amplified by the models and tools that we're building today. So that absolutely has to be top of mind and has to be something we're caring for. I think at the end of the day, if we are building things and doing things with the customer in mind, with that customer first mindset, we will be in a stronger place. And what I see across the insurance industry is that that's what's happening. People want to use data, they want to use technology, they want to use models, machine learning, AI to build better products, to help more consumers to really expand access and expand reach. So that I think is really exciting. And as long as we have the right processes and oversight in place to make sure we're doing it well, it will continue to be a positive.

Patricia Harman (26:19):

Yeah, that's a really nice segue into my next question, which was, what is important for insurers to keep in mind as they're expanding their adoption of technology across the entire insurance ecosystem?

Allison Arzeno (26:33):

Yeah, that is absolutely one piece is just caring for the consumer. So how do we make sure at the end of the day, insurance companies exist to customers to protect individuals, whether you are protecting them from a property and casualty incident, whether you're protecting them from the death of a loved one, protecting their healthcare through the health insurance products we've built, the whole reason the insurance industry exists is to protect consumers. And so I do think we have to keep in mind as we're building new technology tools, there are a lot of things we're going to build that are going to make things more efficient for insurers and make processes easier to streamline the whole system. But at the end of the day, we also have to make sure the things that we're building are existing, are coming to life because they make the experience for consumers better. And that it is something I see across the industry that that's where a lot of attention is being placed. And that's something that I hope to continue to see in the insurance industry that we're really leveraging technology, data and AI for the benefit of the consumer.

Patricia Harman (27:54):

That's really an important thing to keep in mind. Are there any other aspects of technology adoption that you expect to see in the insurance industry in the coming, I would say 12 to 18, maybe 24 months, things that are on the horizon that you're aware of or maybe even some innovations that you'd like to see?

Allison Arzeno (28:18):

Yeah, we talked a little bit about personalized products and innovation and products. I'm very excited to see what happens in that space and one because I just think there's an opportunity for us to create more and better products for consumers. But the other piece that's interesting around that is traditionally insurance is something you buy once and you kind of file it away and you forget about it. And with all of the new products and innovations that are coming to light now, that's a little less true. And so in a way, I always encourage friends and family or consumers to make sure you're shopping around, make sure you're seeing what is available, what is out there for me, even if maybe your premium has increased or your rates have increased, and when you switch, you're perhaps going to pay a little more. You're going to get so many more benefits from that amount you're paying and perhaps get a better product. And so that I think is going to be really interesting. And something I'm excited for us to help consumers with that assurance is as we have more innovation and products, as consumers have more choices and more trade-offs that they have to make, how can we in the industry help consumers navigate those choices and make sure that they truly are holding the best possible products that they can?

Patricia Harman (29:43):

That's true. It's encouraging to me to hear that when you're talking about insurance, you're telling people to shop around and think about this. It's funny. My friends are like, ah, there she goes again, talking insurance. But to me, this is such a fascinating field and there's so much that's changing and going on now in the industry. So over the last half hour or so, we have really covered a lot of different topics, but I'm wondering, is there something that I haven't asked you that you'd like to make sure that you share with our listeners?

Allison Arzeno (30:15):

Yeah, the last thing I'll just add is the importance that in the insurance industry, we're really reaching all consumers across our country. That is something we care deeply about at Assurance is with technology, with a remote workforce like what we have at Assurance, we truly have the ability to reach and interact with and help consumers all across the country. And historically, as we go back, decades, I do think there was a big number of consumers who were overlooked and underserved. And I think we have an opportunity with technology, with data, with AI to really make sure as an industry, we are serving everyone who could benefit from holding the products that we sell. So that's something we're very excited about at Assurance, and I think there's just so much opportunity in our industry to do more in helping more consumers.

Patricia Harman (31:14):

Well, thank you so much, Alison, for sharing your expertise with our audience today. Thank you to our listeners for listening to the Dig In podcast. I produced this episode with audio production by Annan Khan. Special thanks this week to Alison Arzeno of Assurance IQ for joining us. Please rate us, review us, and subscribe to our content at Dig In. That's dig-in.com/subscribe. From Digital Insurance, I'm Patty Harman, and thank you for listening.