What is the biggest change a P&C exec sees when she moves moves from traditional carrier to insurtech innovator?
The way the traditional carrier was restrained by and had to work round the inflexibility and complexity of the legacy technology stack.
The speed with which an insurtech like Snapsheet can act is impressive
"Snapsheet created a new total flood loss workflow for carriers in affected cities that identifies and evaluates flood accidents in the event of a hurricane. Flexible technology, combined with deep expertise and a willingness to change made it possible to build a new, more efficient workflow literally overnight."
Insurtech News Jan 19th 2018
360Globalnet did exactly the same for Hurricane Irma.
When Andy Cohen moved to Snapsheet he was amazed by the speed, flexibility and customisation that the insurtech technology stack offered.
BUT, and a big BUT- If the changes can only be delivered from the insurtech however that is a reversion to the top-down approach of legacy enterprise app development.
Inside every incumbent analogue carrier are a bunch of innovative people- not least in the claims team. This potential competitive advantage is ring-fenced and contained by rigid technology and rigid processes.
The best insurtech will unleash that creativity and pragmatic experience only if they enable the insurer's team to make marginal improvements, iterate and optimise processes and customer UX.
Why? An insurtech is as liable as any organisation to become obsessed with its own processes, ideas that tend to be limited to a narrower set of products, perils and customers. The insurtech must allow the guys at the sharp end to create, test, publish, measure against a BAU control group, iterate and optimise.
A small example:-
A carrier that has deployed a complete digital claims platform (wrapped around its legacy systems). A senior claims handler realised that lost/stolen phone claimants were often not blocking their phone numbers. In 10 minutes he:-
- Configured a new message on the SMS & email link sent immediately the claimant notified the loss on the carriers website
- Tested it on the internal test system
- Published it in the live production system
- Started comparing the results with the "Business-as-Usual" claims
- Adopt and iterate
- Or if it fails, makes no improvement think again
Two immediate effects:-
- Significant increase in customers immediately blocking the number
- Increase in "walk-aways" of fraudulent claimants who actually still had the phone
Multiply a small improvement like this a hundred times and both customer satisfaction and insurer profitability surge in parallel. But only if the insurer can apply this bottom-up ability to innovate and iterate on an hourly basis.
For that, of course, the whole enterprise must have been transformed culturally, organisationally with a vision and leadership across the organisation from claims handlers to the CEO and C-Suite. Technology is the easy part!
The technology stack currently supporting most insurance carriers is not built with scale and flexibility in mind. These packaged and home grown solutions are not designed for modern workflow needs, creating organisational inefficiency and a lack of transparency.