By Stephen Applebaum and Alan Demers —
Much has been written over the years about what sets great Claims organizations apart from all others but none of these outdated analyses really apply anymore.
The “new world” in which insurance and claims now operates features totally different customer profiles, new and still emerging tech-enabled solutions that can solve challenges in the claim process that have existed for decades. Additionally, we have new and very different insurance products and coverage opportunities and a highly competitive business environment in which all participants are judged not just among their peers but against the most popular consumer brands across all industries globally. Further, old marketing and advertising strategies are no longer relevant as new forms of communication have emerged that influence consumer opinions and the way in which information is disseminated and consumed. In short – the game and the rules have changed, materially and forever!
In today’s world, leadership, collaboration and partnerships have the greatest impact on the quality of the claims process and experience.
The greatest single influence over all of this is leadership, which can come from a variety of directions, but most effectively from the CEO or other C-suite leaders. This is where authority and power reside and this is where company vision, mission and culture are created. It is the mission, not the perks, that attracts and motivates employees
The most successful insurance companies are those with leaders who set and continuously articulate the corporate tone, support gender equality, diversity and inclusion, who promote family culture, celebrate employee achievement and life milestones and who aggressively promote and encourage a healthy work-life balance.
And today’s most successful Claims operations are those in insurance companies whose leadership understands the value of and actively support, promote and encourage collaboration and partnerships. In todays “new world” nothing really innovative or entrepreneurial really happens without mastering this collaboration. However, stand-alone solutions – albeit impressive and valuable – generally represent as much of a challenge as solution for insurance carriers.
Obvious examples of support include financial investments, budget, staffing and upskilling initiatives. In larger insurance organizations other assistance may include inter-departmental support from IT, Finance, Digital and Innovation Teams. Alignment with legal support is also essential, especially in light of regulatory and other potential exposures when making process and consumer changes.
Perhaps less obvious, but still critical, is the creation of an environment that encourages a culture of innovation that is future focused; one that features tolerance for mistakes with safety nets in place. This is certainly challenging for leaders who are typically balancing risk and exposure and the demands of shareholders and directors with the recognized need to innovate at an unprecedented pace. The most successful companies have developed teams and processes to identify, engage, evaluate and partner with the best InsurTech startups, who promote “test and learn” and who are able to move rapidly from piloting to implementation. Also demonstrated by these leaders is a willingness to temporarily accept imperfection and iterate to accelerate progress which is a departure from traditional methods of elongated pilots. Being a “fast follower” and waiting for peers to succeed or fail with pilots is only a recipe to fall further behind innovators.
Positioning for Future Success
One additional but perhaps most important of all for leaders is to encourage and resource claims organizations to extensively assess the InsurTech landscape for new potential partners and to keep their knowledge current since startups in particular constantly develop and improve their solutions. It is also imperative that this effort be a team approach, where the broader organization is involved and such learning and information is socialized as opposed to restricted to key individuals or select innovation teams. One such approach is to measure and monitor organizational return-on-learning. In other words, in much the same way as policy coverage expertise or damage evaluation are coveted adjuster and claim leadership skills, organizations should be focused on assessing the effectiveness of sharing knowledge around automation, technology and collaboration.
These initiatives are neither easy or inexpensive, and they undoubtedly require total leadership commitment, but they can definitely turn average competitors into industry leaders and assure longer term success in what we all know is going to be a totally different marketplace and world. At the Connected Claims USA conference (June 24-25 in Chicago), insurance leaders and InsurTech partners will be gathering to learn and form lasting partnerships that will change the game.
About the Authors
Stephen Applebaum, Managing Partner, Insurance Solutions Group, is Chairman of the Connected Claims USA conference on June 24-25, 2020 in Chicago.
Alan Demers is President of InsurTech Consulting and a former insurance claims executive with decades of experience in P&C claims leadership roles. Alan will be moderating Connected Claims USA conference on June 24-25, 2020 in Chicago.