EL SEGUNDO, Calif., Nov. 16 2006 – To stay competitive in the property and casualty (P&C) market, insurers must pursue innovative approaches to pricing and underwriting, according to panelists at CSC’s Future Focus 2006, a two-day conference hosted by Computer Sciences Corporation (NYSE: CSC).
More than 100 insurance and technology executives, industry analysts and media representatives attended the fourth annual conference, held Oct. 9-11 in Charleston, S.C. At the conference, panelists emphasized the need for developing original approaches to attracting and retaining customers in various market segments. This year, for example, Allstate Insurance Co. launched its “Your Choice” automobile coverage, a more affordable way to help keep safe drivers covered and rewarded by combining features such as forgiveness for an at-fault accident, discounts on deductibles and new-car replacement.
“Through our Your Choice Auto program, we’ve become really adept at pricing segmentation, and we’re getting changes to market faster than ever,” said John Bader, vice president of Enterprise Infrastructure Services for Allstate. “To aim this program at specific markets, we worked closely with our agents and added pieces that our research showed the local market desires — not just what the corporate office thinks the market demands — and that is really the basis of what we plan to do in the future.”
The insurance industry’s emphasis on innovation today has expanded from a focus on clients to also include the workplace as companies look to foster innovative thinking by their employees. For example, The Hartford Financial Services Group, a company that has provided insurance for nearly 200 years, now holds planning and brainstorming sessions in the “Transporter Room,” an innovative space with game tables and couches, rather than a standard conference room table and chairs.
“As an industry we need to take a lesson from the fast-food restaurants by adopting more of a pilot approach,” said Andrew MacDonald, vice president and chief information officer for The Hartford. “Before a fast-food restaurant rolls out a new product, it is tested in at least one market to determine customer acceptance. To enable this, it is very important to have flexibility in our systems so we can quickly and easily pilot new products.”
Panelists noted that insurance marketing programs must appeal to three distinct generational groups: Generation Y (ages 18-29), Generation X (ages 30-40) and Baby Boomers (ages 41-59). Each group has distinct demands for service; therefore, insurers must offer different Web-based services that address their consumers’ varying levels of comfort with technology.
“All innovation in the last 20 years can be attributed to software, and it’s helped us change our business from transaction-based to more of an interactive relationship,” said Lori Lehmann, Nationwide Insurance Co. director of Legal Initiatives. “Consumers are more comfortable with technology than ever before, but if potential customers on your Web site can’t get a quote in seven to eight minutes, if it’s too complicated or there are too many fields to fill out, they’re going to bail. We need to make sure we have the internal talent or a third-party supplier that can continually streamline those processes.”
CSC’s Future Focus conference included case studies of P&C insurers that are using innovative software or outsourcing approaches to streamline services for agents and transform claim management processes. For example, Ohio Mutual Insurance Group’s agents can now print policies in their offices; Safety Insurance has expanded its business by providing Web-based services to independent agents; and Sunshine State Insurance uses CSC’s business process outsourcing services to streamline operations and introduce Web services.
Another key topic at Future Focus 2006 was reinsurance. Panelists representing all aspects of the reinsurance market discussed the cost and availability of reinsurance over the next year. The conference also featured 12 sessions on other P&C issues, including change management, legislative issues, workers’ compensation trends, information security, predictive analytics and billing practices. Presenters included representatives from Unitrin Business Insurance, the Property & Casualty Insurers Association of America, the National Association of Mutual Insurance Companies, and financial services industry research and advisory firms TowerGroup and Celent.
About CSC
Computer Sciences Corporation is a leading global information technology (IT) services company. CSC’s mission is to provide customers in industry and government with solutions crafted to meet their specific challenges and enable them to profit from the advanced use of technology.
With approximately 78,000 employees, CSC provides innovative solutions for customers around the world by applying leading technologies and CSC’s own advanced capabilities. These include systems design and integration; IT and business process outsourcing; applications software development; Web and application hosting; and management consulting. Headquartered in El Segundo, Calif., CSC reported revenue of $14.6 billion for the 12 months ended Sept. 29, 2006. For more information, visit the company’s Web site at www.csc.com.
