Personalized Marketing: What Do We Know and When Do We Know It?

By Patrick Vice, Insurance-Canada.caNo Comments

Reading between the lines of some recent reports, I am starting to think that the more we learn about personalized marketing, the less we know about how to implement it.  Fortunately, there is an opportunity to pose questions to leading experts next week.  I hope you can join me to ask your own questions and help all of us understand the answers.

What is personalized marketing?

Most of the articles I read use the term ‘personalized marketing’ without definition.  Maybe I’m just behind in my reading, but I finally had to look it up.

According to,

Personalized marketing is the ultimate form of targeted marketing, creating messages for individual consumers  …  it is most often an automated process, using computer software to craft the individual messages, and building customer-centric recommendation engines instead of company-centric selling engines.

In other words, look at what does, and do it.  Unfortunately, it doesn’t address the information required to construct and deliver the message.  I want to explore a slightly different construct, but before I do, I think it’s important to look at the buzz around personalization.

Expectations are higher internally and externally…

A recent posting in eMarketer begins: “Marketers have heard it loud and clear: Personalization is important. But they’re still struggling to execute it.”  According to the post, the critical roadblock is the lack of integration of internal systems which prevents the development of a single customer viewpoint.

eMarketer cites a Forbes Insight survey of North American Executives which found that their companies were using an average of 36 different data gathering systems.  A quarter of the execs said that there was full integration with their companies.  Thirteen percent said there was no integration, and the majority of execs (56%) said that there was partial integration.  The balance, 8%, didn’t know (how that’s possible is another story).

This status quo was not acceptable for the majority: “Fully 62% said that creating a single, central customer marketing database that housed customer experience information was a priority, and 59% said the same about having a single system to deliver customer experiences across all potential digital channels,” eMarketer writes.

Is this feasible?

Integrating systems is tough stuff, unless there is a very clear, achievable target. I believe that a “single, central customer marketing database that housed customer experience information”  (emphasis supplied) is neither clear nor achievable for the vast majority of Canadian P&C insurers.  A few might be able to consolidate some of the information that is available within the organization, but creating an expectation beyond that is unreasonable.

However, there are likely some alternative approaches that might well serve the need at hand.

CRM 2.0

This blog has noted the history of the “Market of One” concept, which looks very similar to personalized marketing to me.

That post concluded that the next version of Customer Relationship Management (CRM v2.0) will be much more than a really big, fast database.  It will include high powered analytic tools and links to external data sources.  And it will be designed, implemented, and supported by a highly skilled, cross functional team (marketing, business, IT).

Enter Insurance 2024

CRM 2.0 is a long term commitment.  Fortunately the Executive Forum: Insurnace 2024, being held October 7 in Toronto,  will be focused on a 10 year horizon for the insurance industry. at   There will be particular emphasis on digital customer experience.

Many of the sessions will address issues around marketing/CRM 2.0.  Two will be led by insurance practitioners who have direct, personal experience:

  • The Insurance Distribution Channel of 2024 – Jim Ryan, AIG will describe a multi- year initiative involving internal and external resources and a modern CRM platform to develop the insurance marketplace of the future.
  • Marketing in 2024 – Debra Ambrose, Aviva Canada, will moderate a panel to suss out issues and opportunities of a creating and managing a customer driven insurance enterprise .

Details and registration information is available at the the Insurance 2024 site.

What is your experience?

Have you been involved in a personalized marketing initiative?  Are you looking at this for the future?  Are you building components of CRM 2.0?  Please share your experience.  And join us  October 7 to pose questions if you can.

Consumer Insight and Action, CRM, Digital Insurance, Insurance Marketing

Why Wait? E-signature Technology Is Here Today

By Michael LaurieNo Comments

For many business sectors, going paperless is a major efficiency initiative – and insurance is no exception. So why wait?  Perhaps it is tradition, or misinformation, or just momentum.  Let’s look at some facts.

Tangible benefits from virtual documents  ….

E-commerce – including electronic contracting, electronic signatures, electronic delivery of documents, and retaining electronic records in place of paper records – automates and expedites business processes. The process can also cut operational costs and improve efficiency and collaboration. Importantly, e-signatures bring great improvements to the customer experience with a simpler way to complete paperwork on a PC, smart phone or tablet.

What about compliance and legal issues?

Naturally, there is resistance to ditching the pen for digital. But questions about the law have been addressed.  The Uniform Law Conference of Canada adopted the Uniform Electronic Commerce Act (UECA) in 1999. Subsequently, laws that include rules for the use of legal, secure electronic signatures have been enacted throughout the Canadian provinces. In addition, there is the Federal Personal Information Protection and Electronic Document Act (PIPEDA). According to the Office of the Privacy Commissioner of Canada, “the Act seeks to put electronic and paper media on an equal footing.”

Most often, pushback is based on uncertainties about legal compliance and security concerns. But according to Daniel Fabiano, partner at Fasken Martineau DuMoulin LLP and author of the advisory report on electronic signature and delivery commissioned by the Center for Study of Insurance Operations, these concerns are counter-intuitive. “There are obvious and powerful advantages to e-commerce – including the potential for heightened compliance measures and increased security. A well-designed e-commerce regime can address risks and mitigate them.”

And security concerns?

There is a lot of confusion – between SSAE16/SOC 1 and SOC 2 specifically – about what can attest to the security of a system. SSAE 16/ SOC 1 focuses on controls over financial reporting, while SOC 2 focuses on the security controls across a service company’s technological and operational environment. When considering e-signatures, SOC 2 is the certification that matters.

In addition to ensuring the security of the data center and the e-signature system, insurance companies and brokers need to be certain they are implementing an electronic signature application that is built on digital signature technology. This combination makes the e-signature reliable and helps strengthen enforceability. To make the e-signature ironclad, you need to address:

  • User authentication to reduce fraud and ID theft. Verification can be made through traditional login or password, secret question and answer, SMS code or a third-party authentication service.
  • Document security. Digital signatures placed at every signature in the document produces a tamper-evident seal and a reliable audit trail of how and when the document was e-signed and by whom. If someone attempts to make an unauthorized change the document and e-signatures are marked as invalid.
  • Process evidence to prove what took place throughout the progression of the workflow. This is accomplished by recording the web pages, documents, disclosures or pop-up windows that were displayed; emails or SMS messages sent; any voice or image capture; IP addresses and the time and date of each event.

Now, to the heart of the matter ….

While security and compliance are of the utmost importance to the insurance industry, an e-signature solution also needs to make a positive impact on customer experience and support the way brokers work. This is possible with a flexible e-signature solution that can adapt to the environment in which it is being used – in-person, at a point-of-sale, or remotely over the phone/web.. Without this, goals for adoption will be compromised.

Also, if signers need to jump through hoops to identify themselves, can’t print before signing, or are required to install software, they are more likely to abandon the process before the transaction is completed. A good electronic signature solution built on digital signature technology allows brokers to invite customers, to review, accept, and securely e-sign documents from any web-enabled device (computer, tablet or smartphone) at any time.

So, why wait?

The technology to mitigate risk and improve the customer experience isn’t on the horizon – it is here. The time is now to move forward into the digital age. We have developed an ROI Calculator to show how a clear e-signature strategy  opens the opportunity for increased revenue, improved customer loyalty, and lowered operating costs.


Editor’s Note:  Michael co-founded Silanis more than 20 years ago. Today he is
responsible for planning and growth strategies for product marketing and
product management

Digital Insurance

Climate Change Day Musings: Lessons from The Marshalls on Insurance and Technology

By Patrick Vice, Insurance-Canada.ca1 Comment

On this day of Climate Change Awareness,  I am proud of the leadership role that the insurance industry is playing in raising awareness of climate change impact, and supporting change adaption and remediation.

If you are not aware of our industry’s activities combating the effects of climate change, take a moment to check them out and see what you can do to promote and support them.  Before we do, will you join me on a trip to the Marshall Islands, where climate change is not a debate: it is an existeMap-Marshall_Islandsntial threat?

About The Marshalls …

Marshall islanders are proud, self reliant, strong people.  And they are great mariners.  They have to be … there are only a few commercial air strips in the island chain, and water landing on the Pacific ocean is not recommended.

The Marshall Islands are located 3,700 km southwest of Hawaii and span 300 km, lying between 5 and 7 degrees north of the equator. It is comprised of 29 atolls.  Important note:  an atoll is the rim of an ancient volcano, which creates a circle of dry land just above the ocean’s waters.  On Majuro, some parts of the land lie 30 cm above sea level.

The Marshall Islands have been strategic points for many nations, including Germany, Japan, and the US.  The first hydrogen bomb was tested on Bikini Atoll in the Marshalls.  The result was displacement of a a population for decades, devastating the way of life for the inhabitants.

In the first part of my career, I worked in the Pacific, doing disaster training and response.  I spent time in the Marshalls doing both.  I was on the islands once after a small typhoon.  I had never seen such complete damage.  The wind was bad, the water worse.  That was in the late 1970s.

The ocean levels have risen since.  In March of this year, there were ‘King Tides’, which caused substantial damage and evacuations.  Based on The Intergovernmental Panel on Climate estimates, the impact of these natural phenomenon could inundate two thirds of island chain.  This displacement would outpace the H-Bomb displacement by unknown orders of magnitude.

Insurance will be challenged …

All of this helps me understand that regardless of the causes of climate change, it will have consequnces for most commercial activities, insurance being a canary in the coal mine, so to say.  In June 2013, Macleans published predictions by Blair Feltmate, chair of the Climate Change Adaptation Project at the University of Waterloo, arguing that “Millions of Canadians living in many parts of the country could find their homes declared uninsurable, as the insurance industry grapples with skyrocketing water damage claims.”

The past year has played out enough examples to support this thesis, and we will be facing hard decisions on coverage for overland flooding. This is a daunting task, however work already initiated gives hope that we will address the challenges in an intelligent fashion.

Where did we start …

Canadian insurers have taken a leadership role in identifying exposures, quantifying impacts, and developing accommodation strategies.  One concrete example of industry cooperation is the Institute for Catastrophic Loss Reduction (ICLR).  Founded by the Canadian insurance industry in 1998, the ICLR is an independent, not for profit research institute, which works in conjunct with the University of Western Ontario.

ICLR’s broad theme is: “science to action: Canada’s insurers building disaster resilient communities”.  it researches and provides advice to homeowners, builders/developers, and municipalities to reduce the impact of natural disasters.

ICLR does not weigh into debates on the politics of climate change, but does provide required adaptation strategies. In 2011, it published research on trends, entitled “Climate change information for adaptation,” the purpose of which was to demystify climate change to “permit initiation of pro-active adaptation measures.”

 Where does technology fit …

The ICLR and other awareness and adaptation initiatives are only as good as the data behind the analyses.  The industry has supported private an public initiatives to understand climate and its impact.

Moreover, new technologies to allow devices to communicate their status in real time will allow more just-in-time solutions to crisis situations.  This blog has provided some examples (see, The Internet of Things&Impact on Insurance), and we expect much more to come.

Will this help the Marshall Islanders?

The threat of storms in the Pacific is ever present, so research will not immediately help people living 30 cm above sea level.  However, the work of ICLR on targeted mitigation schemes, combined with progressive thinking on building specifications will have spin off effects for all those listening and caring.

This is what make me proud of our industry’s approach.



Need Core Systems Replacement Success? Think Small!

By BlogEditorNo Comments

To mitigate risk with large technology projects, experts suggest careful planning and on-going control of scope.  There’s an old adage that advises:  “Start small and be prepared to scope down.”  Now, some data from the US and anecdotes from Canada suggest there may be one more piece of advice for success:  “Be small, and be happy.”

We’d be interested in your comments.

Looks like size matters …

Analyst firm SMA is reporting that there has been progress in core insurance systems replacement.  Quoted in Insurance & Technology, Karen Furtado, an SMA partner, summarized progress from 2011 to 2013: “On average, 24% to 31% of companies have a modern current system in place — over a quarter of the market has modern and current solutions in place. That’s good.”

In addition, there seems to be an interesting twist to this, relating to the size of the organization.  One measure of core business systems replacement is the capability of retiring existing legacy systems.  From that point of view, it appears that smaller organizations (under $1bn in assets),  are rationalizing systems more quickly than larger counterparts.  Two thirds of personal lines carriers have only one system.  For carriers over $1bn in assets, the percentage with only one system drops 27 basis points to 40%.

But are they satisfied?

Furtado notes that the smaller organizations have a higher degree of satisfaction, noting that “struggling with the implementation actually is owned by the over $1 billion,” which includes business / technical  scope,  schedule, and budget. Moreover, according to Furtado, larger organizations have greater challenges with integration to other systems.

Small and happy in Canada …

We don’t have detailed data, but we have noted some smaller organizations which have had unique success in implementations.  Last year, CAA Insurance (Ontario) implemented the Guidewire InsuranceSuite™, which included rating, underwriting and policy administration, claims management, and billing functionality.   The really impressive part is that CAA completed all the functionality in parallel, including external integrations, in 14 months.

Let us repeat:  All Functionality … In Parallel … 14 Months.

Earlier this month, Norfolk Mutual successfully implemented the Mutual Concept Computer Group’s Insurance Business Solutions (IBS) product for enterprise back office  management.  Not that they were competing with CAA, but the project, from infrastructure set up to ‘go live’ was competed in 9 months.

We take a ‘pregnant’ pause here: Go Live … 9 months.

What’s even more impressive, the MCCG solutions has been implemented by 28 other mutual insurance companies in Canada.  Small can cooperate.

What do you think?

Smaller carriers have challenges in competing with larger insurance entities when it comes to capacity and scope.  However, it seems that they have some advantages when it some to deploying core systems packages.

We’d like your opinion.  Is it good to be small?  Give it a little thought, and drop a short note below.

Modern Technology

A Delicate Balance In Commercial Underwriting Technology

By Patrick Vice, Insurance-Canada.caNo Comments

Is effective commercial lines underwriting technology an oxymoron?  There are enough graveyards filled with projects that have arrived DOA to make this seem true.  But hasn’t modern technology had an impact?

Perhaps, but not on its own.  There is increasing evidence that technology solutions need to be blended carefully with business wisdom to balance efficiency with effectiveness.

I’d like to know what  you think.  Is there an issue with commercial underwriting technology projects?  If so, what needs to be done?  We have an opportunity to pose some questions to an expert at next month’s Executive Forum.

What do underwriters say?

In mid 2013, Accenture conducted a survey of over 550 North American underwriters on the expectations and challenges of their work and the impact of the introduction of new data sources, modern analytics, and automated systems.  The report, North American Commercial Insurance Underwriting Survey, contained some sobering findings.

The top three challenges to achieving results were:

  1. Maintaining underwriting pricing and discipline (72% of respondents)
  2. High operating costs/expenses (55%)
  3. Lack of quality UW information (47%)

The underwriters see their companies addressing some of the issues with the introduction of:

  • Process automation (57% of respondents)
  • Predictive models for risk evaluation and pricing (51%)
  • External data for risk evaluation (51%)
  • Collaboration tools (49%)

Sounds like IT is aligned with UW needs, yes?

Efficiency gains only fill half the glass …

The problem the underwriters see is that effectiveness of the solution is lacking.  Only half of respondents felt the technology currently in use is very effective.

Worse, as the report says, “This lack of effectiveness rating is even greater among frontline underwriters.”  Over half of the respondents said that their workload  increased with the introduction of new technologies.

Consulting firm, Cognizant, came to similar conclusions in an analysis of performance impediments for commercial lines underwriters, writing:

Commercial underwriting is unlike other processes in the insurance industry in that it has an extremely complex and non-standard process, requires different types of skills, uses mostly unstructured data and is highly dependent on human judgment.

According to Cognizant, this underscores the historical common wisdom that the commercial insurance process is “not conducive to technological intervention.”

So, have the luddites won?

No. In fact, the opportunities are large.  Cognizant notes, “Compared to other core insurance processes, small improvements in underwriting can lead to tremendous benefits both on the top line and bottom line of the insurer.”

But technology improvements must carefully balance effectiveness and efficiency.  And be respectful of the knowledge workers’ changing requirements.   According to the Cognizant authors:

The work profile of underwriters is changing as market volatility has become the new normal and is something that they have to deal with on a daily basis. This change will cause underwriters to spend less time on their traditional submission management tasks and more time on relationship management and fulfilling the role of a risk consultant to their key clients. Systems need to quickly catch up to enable underwriters to shift gears.

Speaking of Change …

Both consultants’ reports stress the importance of delivering data and analytics to commercial underwriters in an effective manner.  Micheal Costonis, executive director of Accenture’s Insurance practice for North America, has developed best practice steps for analytic success, several of which seem to be specifically targeted at commercial lines initiatives:

  • Integrate analytics into the business processes. Data, technology and business must work as one team, and from the beginning of any effort.
  • Build a solid business case. Analytics should be used to solve defined business problems and answer specific questions.
  • Face up to the technology challenge. Insurers need to keep up the pressure, focusing on upgrading systems, digitizing processes and capturing data.
  • Leverage big data. Insurers deal with large amounts of unstructured data, but tools are getting better at dealing with this. And don’t forget about external data that is now available, including social media, telematics and data from external providers.
  • Initiate pilot projects to test concepts. Data and analytics lends itself to a test-and-learn environment, which can minimize sunk costs and enable faster innovation.

Michael will be presenting at the Executive Forum, focusing on how insurers can effectively respond to the changing environment. I’ll be interested in hearing comments on commercial lines.

What do you think?

If you’re an underwriter, what have you seen that has worked for you?  What hasn’t worked.  If you are a technology supplier, do the challenges above ring true?  What approaches do you take?  If you are an executive, how do you create an environment that balances effectiveness and efficiency?


Analytics, ICEF2014: Insurance 2024, Modern Technology, Underwriting

Can Brokers Manage the Next Wave of IT?

By BlogEditor2 Comments

As we look over the topics we have covered in this space, it occurs to us that the brokers might be getting hit with more IT than they expect over the next little while.  We’d like to know what you think, and, if you are part of the broker distribution value chain, what, you think needs to be done.  We do have one suggestion.

Our bias here…..

We are big fans of brokers.  Brokers tend to punch above their weight when it comes to creativity, resilience, and business savvy.  And, in spite of their fierce independence, and competitiveness, they can come together quickly and effectively to defend their own interests as well as those of their customers, and (yes, really) their insurance company partners.

And they can be a lot of fun.

That said, it’s not easy being purple* ….

In a hard market (if you don’t know what this means, ask someone with grey hair),  brokers have to work hard to maintain coverage for their clients at reasonable prices.

In the current market, brokers have to work to maintain their client base from competitive attacks by direct writers, captive agents, and fellow brokers.  And do so with a revenue stream that ranges from steady to decreasing.

Meanwhile, brokers have to retain talent (good producers and CSRs are always in demand), deal with non-revenue generating activities (endorsements, claims), and meet the demands of insurers and shareholders/partners/other stakeholders for ROI and (yes, really) growth.

Good brokers do all of this and more.  Many product enhancements and new covereages are broker driven.

Where does IT fit with brokers today?

Driven by client service and internal efficiency,  leading brokers were early adopters of office technology.  By the end of the 1970s, a critical mass of brokers had purchased large (for the time) turn-key broker management systems (BMSs) to handle client and accounting management.  By the end of the 1980s,  these systems were into their second and third generations.

Brokers also drove development of standardized connectivity between their offices and multiple insurance companies.  We’ve written extensively on the history of broker connectivity and our thoughts on next steps.  Suffice it to say that while no-one is really satisfied, there has been a lot of progress.

So, in addition to running the business, the broker has to commit cycles to using/supporting/maintaining/replacing complex systems.  In general, when a broker’s staff count gets to 10 or more, someone in the office will be spending more than 50% of his/her time on technology.

The next generation of technology doesn’t fit in easily ….

Here’s some of what’s happening now and what could be coming for brokers:

Social Media – This is more than a fad.  And it’s more than Facebook and Twitter.  Increasingly, consumers want to use they media they are most comfortable with and expect that suppliers will keep up.  Earlier this year, we posted on this.

Telematics and the Internet of Things – Most brokers have heard about Telematics/Usage Based Insurance.  The Insurance Brokers Association of Ontario is developing a broker owned facility – IBRI – which will offer brokers an option.  However, other insurers will have their own solutions and other risks (property, commercial) will be increasingly monitored by electronic sensors.  This “Internet of Things”  will drive underwriting/rating, claims, marketing data.  One outcome is that brokers will have a decreasing ability to supply quotes from their existing technology.

Big Data/Analytics - Insurers are expanding use of sophisticated analytics engines to work with Big Data for claims, underwriting, marketing.  While most brokers will not have the need or ability to have parallel systems, they will be required to understand and speak the same language as the insurer.

Customer Relationship Management (CRM) - Previous generations of customer database tools focused on the individual/family/business at the centre, with other elements – including insurance – as relating to one entity.  The more modern approach – required in our more complex data driven world – puts no one at the centre, but describes links based on relationships.  This is critical for the more sophisticated personalized marketing that is becoming a competitive differentiator with organizations such as and Google.

What to do?

For many brokers, the principal will be increasingly challenged to be the Chief Information Officer for her brokerage.  This requires a working (not necessarily technical) understanding and an ability to sort out the real opportunities, and attendant costs/efforts, for the brokerage.

We think that targeted education is key. is hosting Insurance2024, an executive forum on October 7, 2014 in Toronto which will bring experts to help insurer and brokerage executives understand trends for the next decade, and focus on key elements.

Take your future in your own hands. Reduce the overload.  And get back to having fun.


* Purple is the colour used in the Broker Identity Program

Analytics, Big Data, Broker-Carrier Connectivity, CRM, Data, Education & Training, ICEF2014: Insurance 2024, Internet of Things, Social Media, Telematics

Pragmatic Telematics: Reality Trumps Theory in Chicago

By Patrick Vice, Insurance-Canada.ca2 Comments

I detected a noticeable change in tone at the Insurance Telematics USA conference held in Chicago last week. In prior years, much of the discussion was prognosis and guesstimation.  This year, the majority of presentations and conversations dealt with real-world issues relating to development, implementation, promotion, and utilization of telematics-based usage-based insurance (UBI).

I think this portends a solid future for UBI in Canada as well at the US. Here are a few examples, including my own personal experience.

Not if, but when and where …

As in the past, the kick-off keynote was presented by Robin Harbage, Director at Towers Watson.  Harbage noted that there has been a shift in attitudes by US consumers; with 52% of consumers interested in UBI, and another 27% who may be interested.  This could double the uptake in UBI from 4% to 8% sometime in the next 18 months.

According to Harbage,The primary concerns by consumers are:

  • Possibility of premium increases in future 48%
  • Privacy 39%
  • Denial of claims (based on telematics data 33%

Harbage noted that proxy implementations will continue, as most insurers will not invest heavily in big data infrastructures before some proof of concept.  However,  Harbage recommends insurers to move from proxies, increasing the granularity of the data used and adding contextual information, such as road conditions, weather, etc.  Failure to do so reduces the value of the UBI program as a strategic predictive modelling tool.

Not why, but how and who …

Progressive Insurance continues to be the recognized UBI leader in the US.  David Pratt, Progressive’s General Manager of UBI, focused on Progessive’s  evolving marketing strategy, outlining the data-driven campaigns the company has used to drive uptake.

The first phase was simple awareness of the program, ‘Snapshot’, using Flo, the popular Progressive spokeswoman, who stressed the benefits of good driving, and the simplicity of installing the device.  (This blog noted the theme  in an August 2012 post.)  Phase two was more direct, challenging good drivers to test drive the product.

For phase three, Pratt noted that consumers had expressed concern that poor drivers were forcing increased premiums for everyone, regardless of driving behaviour.  As a result, Progressive changed the tone of the ads, showing Snapshot as a cure for ‘Rate Suckers’  (bad drivers portrayed a leaches sticking to the windshields of good drivers’ cars).

Pratt gave the audience a preview of some of phase four material, coming out this month.  To address interest expressed by customers, Progressive describes what the Snapshot device does, using cartoon character to emulate the device, riding around in the car as a companion.

Pratt was careful to point out that its marketing/advertising is data driven, and encompasses all media.  In addition, it focuses on training for its employees and its agency force to ensure that there is consistent representation of its products.

Progressive’s track record now includes $2 billion in Snapshot driven premium and 11 billion recorded passenger miles, which is used to refine the rating algorithms.  Pratt noted that their big data structure will allow for addition of variables in future as experience evolves.

Consumer Rights and Data Portability

I had the privilege of moderating a panel of practitioners discussing impacts of consumer rights and data portability have on  UBI adoption.  Panel members were:

The panel noted that common standardized scoring data will promote efficiency and effectiveness, and can protect privacy of data for consumers as well as propriety of algorithms for insurers.  However, there could be challenging side effects.  For example, as the penetration of UBI expands,  drivers who elect not to utilize telematics based UBI may find that insurers are less interested in the business.  This could result in digital ‘redlining’, if carried to an extreme.

Canadian Content

I was very pleased to see participation at the event by Canadian insurers and Canadian-headquartered suppliers, including IMS, Baseline Telematics, and IMETRIK.  In addition, a number of  participants are actively following developments with the IBAO IBRI initiative.

What do you think?

My sense is that telematics based UBI is now entrenched with the US insurance market, and that this will further encourage Canadian initiatives.  Does this make sense to you?


Big Data, Telematics

Can You Say ‘No’ to Driverless Cars?

By Catherine Kargas MARCONNo Comments

In July, I attended the 2014 Automated Vehicles Symposium in San Francisco. Over the last three years, attendance at the event has grown significantly. This important increase in attendance mirrors the tremendous rise of interest in the subject of driverless technology as well as the rapid pace of technological advancement necessary to bring driverless vehicles to the consumer in coming years.

I’ll be exploring this at the Executive Forum: Insurance 2024 in October, but here are some highlights I took home from San Francisco.


Interest is up … who’s saying ‘no’?

I recently did a quick Google Trends search on the word DRIVERLESS and as you might assume, the increase in the popularity of the technology is reflected in the  number of individuals researching the subject (see diagram opposite).

As the technology becomes better known, its opponents are starting to take position. These naysayers include those who drive as a profession (understandable as driverless vehicles would obliterate the driving profession) as well as those whose business model (in fact, the very existence of their business) depends on the current inefficient mobility system continuing on the same path. Numerous businesses are part of this latter category, including automobile manufacturing, auto repair, driving schools, many in the legal profession, etc, etc.

Instead of acknowledging that the commercialization and adoption of this technology is inevitable (for safety, environmental and congestion reasons to name a few – discussed in previous articles and blogs on and preparing for it, many businesses are instead choosing to belittle the technology in the media and lobby government groups to delay changes in regulations legalizing the circulation of these vehicles on the jurisdiction’s roads and highways.

Does ‘no’ mean ‘not’?

While numerous presentations and speeches were made at the 2014 Automated Vehicles Symposium, one presentation and in particular one slide (and accompanying comments) stuck in mind. Here is the slide that Ralf Herrtwich of Daimler presented to a standing room only audience:


Herrtwich asked if anyone recognized any of the names / brands on the slide. No one did. Well … they are all brands of the leading horse carriage manufacturers who went out of business with the arrival of the revolutionary technology known as the automobile.

Businesses can either accept that the next revolutionary technology – driverless vehicles –  will be among us and prepare for its commercialization and adoption or suffer the fate of so many forgotten brands / companies.

One car manufacturer is saying ‘yes’ …

Daimler has chosen to adapt. All while continuing to manufacture its various automobile brands, the company, recognizing the opportunities afforded by the shared economy, has vertically integrated forward into the car sharing space with car2go. Daimler is also one of the leading developers of driverless technology. The Mercedes S class is equipped with one of the most advanced autonomous drive systems currently available on the market.

How can you prepare?

Are you preparing for the upcoming driverless revolution?  Join me at the Executive Forum: Insurance 2024, in Toronto, on October 7th, and determine how this technology may be impacting your business model in the foreseeable future.

Autonomous Vehicles, ICEF2014: Insurance 2024

What Influences Decisions on Digital Advertising for Insurance?

By Patrick Vice, Insurance-Canada.caNo Comments

Back in my hometown of Detroit, I learned that consumer advertising decision-making by automobile manufacturers consisted of one part art, two parts science, and and some unknown parts corporate politics.   I’m thinking that there may be a similar formula in place for decisions on digital advertising by insurers.  I’d appreciate your thoughts on this.

“Digital Display Advertising Nine Times More Effective Than TV for Auto Insurance Brands”

… That was the headline of an announcement of results of a US based study conducted by media buyer Rocket Fuel. Key points were:

Source: Rocket Fuel Insurance Study 2Q2014

Source: Rocket Fuel Insurance Study 2Q2014

  • “Top of Mind awareness is highly correlated with market share for both auto insurance (0.83)  and homeowner’s (0.87) insurance….
  • “Cross-channel ad spend was a key predictor of top-of-mind awareness for auto and life insurance providers, with digital display ad spend being nine times more effective at driving top-of-mind awareness than TV.
  • “Nearly half (44%) of consumers only look at a single quote before making a purchase.”

The study was based on a survey of 1,026 consumers.  The study also included detail on the impact of various advertising strategies, including ad types, time of day impact, and ad content (e.g., “Human faces improve conversion rates”).

There is a lot of other data suggesting that consumers are going on-line to research their insurance needs.  These new data suggest consumers are heavily influenced by the results.

So, digital advertising is trending, right?

Perhaps … It depends who is reporting.  Separating digital from other spending is not easy to suss out, so I had to rely on proxies.

Kenshoo, which supplies technology to assist in placing digital ads. reports that the insurance industry – which they note are not often associated with “digital” or “innovative” – are making substantial strides.  Kenshoo notes that recent research has revealed that financial services – including insurance – is expected to increase digital spend by 83% between now and 2017 to respond to increased consumer interest in consuming digital information about financial products.

The demand estimate tracks with Rocket Fuel’s survey results.

However, a second report by Aite Group indicates that, within insurance, there is a digital divide impacting customer experience generally.  An analysis of the top 20 US auto insurers’ digital capabilities  found that “the top five U.S. automobile insurance companies by market share all have websites, mobile sites, and social media sites that are regularly updated, modern, and easy to navigate.”

However, “Farther down the list of top companies, fewer show involvement in social media activity, and some even lack accounts on major social networking sites.”  I may be wrong, but I’m guessing you can’t really have a Facebook advertising strategy without a having a Facebook account.

Where will insurers take digital advertising?  Do we need a Motown solution?

There is a consensus that insurers should embrace digital more aggressively in all parts of the transaction, including advertising. However, it takes a common vision of the digital future of the organization.  Not easy to do.  Which brings me to my Detroit story.

A friend of mine worked for an ad agency for one of the big 3 auto US makers (when they WERE the big 3).  For one new model campaign, the agency developed a bold, innovative approach, supported by massive amounts of consumer survey data.  The marketing department of the car company did a rigorous evaluation, including its own independent analysis, and concurred.

However, other members of the senior executive disagreed.   The executives discounted the data, promoting their approaches as “common sense”.

The marketing department and the agency got together and devised a strategy that ultimately received approval by the COO.  There would be two campaigns.  One ran in the Detroit area, focusing on the TV stations, radio stations, newspapers and magazines that were popular with the executives.  The other ran on various media using data-driven, segmented messages.

The dual campaigns were successful.  The first kept the executive team happy.  The second hit the marketing targets of the enterprise.

Where are you on digital advertising?

What do you think?  Are you seeing the need to move more advertising to digital?  Do you have a strategy in place?  Are there reasons that you are holding back?






Insurance Marketing, Social Business

Data vs. Data Governance? Chicken & Egg Dispute Resolved!

By BlogEditorNo Comments

It looks like the egg comes second in one “Which came first?” argument. At least, that’s our read on a recent report by Celent, based on a survey of insurance companies on the topic of data governance. It seems that the Data chicken precedes the Governance egg by a long stretch.

Our question to you:  Will we ever see a perfect omelet before the landscape is overrun by clucking birds?

What’s what and who’s who…

The report:  The Importance of Data Governance: Current Practices, authored by Celent research director Karlyn Carnahan, sought to understand how insurance carriers viewed the value data governance in a world that is becoming increasingly data driven.  Forty one carriers, including 28 P&C and 13 Life and Annuity were included.  The results were differentiated between large and midsize, with the line drawn at US$1bn premium.

We are calling the Data initiatives the Chickens with the Egg representing the Governance.  Our view is that, in the perfect world,  the governance egg will contain the DNA and fundamental energy required for healthy chicken data projects.  (It’s just an analogy, so we won’t go deeper than that.)

Theory, Meet Reality…

Let’s cut to the chase.  The majority of companies see data initiatives as “mission critical”, with all of the remainder scoring them as “highly important”.  Enough said.

datagovernanceWhen it comes to data governance,  the report says, “although more than half of the carriers report governance as mission-critical or highly important, fewer than half have formal data governance initiatives in place.”  Actions do speak volumes.

Is data governance required?

The Celent report provides some important information about the requirements for governance.

When asked what the biggest challenges are with data, number 1 is “collecting and analyzing it quickly enough.”  Time to market is a critical success factor for many, right?

However  we see the 2nd and 3rd biggest challenges reported rest squarely in the governance wheelhouse:

  • A fragmented data environment (e.g., multiple definitions of the same thing in different systems)
  • Poor data quality

When asked why carriers undertake data governance initiatives, the top 3 reasons are clearly strategic:

  1. Improve the decision-making
  2. Gain unique insights
  3. Improved management planning

We’d say these sound like important requirements, so …

Why is governance playing second fiddle?

The Celent report indicates that data governance is an emerging discipline. Rules of engagement are not yet mature for:

  • who should be responsible,
  • what the ownership model should be,
  • which stakeholders are required to come to the table, and
  • how much data can, or should be governed.

This begs for more time to resolve these issues.  In this rapidly changing world, however, do we have the luxury of time?

The Celent report captures the conundrum well:  “As the insurance industry moves into a more data-centric world, data governance becomes more critical for assuring the data is consistent, reliable, and usable for analysis.”

The risk is that the data themselves will lose credibility.

Who needs to do what to whom?

Without saying that the CIO is responsible for plowing this field, the report outlines four steps for that office to undertake, to drive consensus and move towards informal and formal governance protocols that will address the organizations priorities:

  • Keep it realistic.
  • Develop a cross-functional approach to data governance.
  • Gain support by communicating the benefits of data governance.
  • Prioritize the development of formal data governance initiatives.

What do you think?

We found this report (which has more detailed analysis than we are able to outline here) to be an important contribution to an important topic.  But we’d like your thoughts.

  • Is data taking precedence over governance in your world?  If so, is this a bad thing?
  • Have you any governance principles that work in your environment that you can share?
  • What would help you in your role with data and their governance?

Don’t be chicken … share your thoughts.

Analytics, Data, IT Management
Blue Taste Theme created by Jabox