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Since insurance technology journalists and analysts are tasked with clarifying the industry’s direction, our view can sometimes take on a facile quality, making progress appear easier than it is. It is in conversation with the professionals charged with realizing that direction that one sees how difficult change can be, especially in a highly regulated industry such as insurance. At a recent roundtable discussion in New York sponsored by customer communications management (CCM) vendor Smart Communications, the conversation emphasized the real striving required to digitize the insurance enterprise, in the case of customer communications and more broadly.
Delegates from a wide range of companies participated in the conversation, including insurers—MetLife, Cigna, Horizon Blue Cross Blue Shield, Indiana Farm Insurance and Global Aerospace—and also from financial services and other industries—PNC, American Express, CVS. The delegates shared experiences (whose particulars we agreed would remain confidential) and debated the future of customer communications and and the challenges of digitization.
The Customer as Individual: Personalization
Navigating emerging trends is typically a matter of projecting what seems obvious, and then anticipating the unexpected. For example, at the dawn of e-commerce many observers saw the Internet as an engine of disintermediation, when in fact it turned out to be a key tool for distributor ease-of-doing-business. Similarly, the delegates around the table noted a key counter-intuitive feature of customer communications. While people are living highly digital lives mediated by electronic communications—the typical consumer owns three mobile devices—customers still expect the opportunity to interact personally in real time. Moreover, they want to be treated as an individual, not an account number or a generic market segment.
Consumers want choice not only in the degree of personalization, but in which channel they want to use at a given time for a given purpose. They don’t want to be told how they must interact but expect convenient options for interaction. Unfortunately, some delegates reported, it is sometimes difficult to communicate to customers what options are actually available from their insurer or other business.
Insurers need to keep pace with consumers’ channel preferences and accommodate both the most digitally savvy customers—who may prefer SMS communication or chatbots—and the more traditional customers who may prefer telephone and written correspondence.
But it’s not so much about a consumer choosing a given channel, several delegates observed, but their expectation to choose any given channel at any given time. Customers want to be able to interact across both devices and channels.
The Continued Relevance of Segmentation
While customers expect to be treated as individuals—and insurers must plan their communications technology strategy accordingly—individuals also have a social dimension that places them in a segment or segments. An example offered: when a customer goes into a branch, the manager knows that the customer is a native speaker of Polish and speaks to them in that language. However, follow-up conversations are likely to be delivered in English—even if the resources are available for multilingual communications. Interactions should be intelligently connected, and by taking a customer-centric approach, companies can foster customer loyalty by listening to an acting upon the needs of their customers.
Cloud Has Reached a ‘Tipping Point’
Highly regulated industries have been reluctant to move services off-premise into the cloud, and insurance is a notable example. However, that is rapidly changing. Delegates agreed that the insurance industry has passed a kind of “tipping point,” where senior leadership has turned from reluctant to enthusiastic about the cloud. While companies have long regarded the economic benefits of cloud delivery as obvious, but insufficient to counterbalance privacy and security considerations and regulatory compliance issues more broadly. A simple realization has flipped this position on cloud from “off” to “on,” according to delegates: the understanding that mature cloud offerings not only provide infrastructure as a core competence, but that they do data security on a higher level than insurers and other companies do as well.
Emergence of AI
Delegates discussed artificial intelligence (AI) as a promising direction for aspects of communication that can be automated. Currently, chatbots are some distance from passing the Turing Test—performance that makes it impossible to tell between human and machine—but these technologies are likely to have increasing impact within a fairly short timeframe.
Hitting the Moving Target of Customer Expectations
The broad challenge for insurers, as for other companies, is not to provide a quality customer experience per se, but to have the capacity to continually reshape that experience to meet rapidly changing customer demand, delegates agreed. They must keep their brand front and center in the quest for customer loyalty and retention, while simultaneously adhering to stringent industry regulations.
To communicate successfully with customer on a digital platform, companies must invest in enabling conversation across channels, keeping the requirements of their customers foremost. Those who most successfully digitize will compete effectively on those with less success, and those who fail to digitize meaningfully will be left behind.