An insurer that covers every individual within its country’s borders for injury is not just rare – it is completely unique to New Zealand.
The Accident Compensation Corporation (ACC) was founded in April 1974 as a result of the Accident Compensation Act 1972, and provides cover to all citizens, residents and visitors who have suffered an accidental injury. It covers work and non-work injuries and operates on a no-fault basis, meaning injury sufferers cannot take an at-fault party to court over their accident.
ACC has undergone vast and significant transformations over its 44 years in operation. According to ACC chief executive Scott Pickering, who spoke at the Insurance Council of New Zealand conference last November, the changes have been driven primarily by the falling customer confidence that was observed five years ago in 2013 when he first took the job.
“At heart, I’m a proud Kiwi, and that’s why I love my job supporting New Zealanders as the chief executive of ACC,” Pickering said.
“Everyone in the country is a customer of the Accident Compensation Corporation. We are uniquely Kiwi, there is nothing like us anywhere in the world. Last year, we supported more than a million clients visiting their GP, we funded surgery for 38,000 clients and more than 102,000 Kiwis receive weekly compensation. That comes out of a grand total of 1.98 million claims, and that equates to 31% of the population who receive compensation or rehabilitations services.”
According to Pickering, the majority of those claims would likely have been for New Zealanders who weren’t even aware that they’d had an ACC experience. As well as being an accident insurer, ACC is also one of the country’s largest sovereign wealth funds with over $40 billion in investment reserves to cover the future costs of injuries.
“Our investment income means we can meet not only today’s costs, but also the future costs of injuries without the need for New Zealanders to pay more levies,” Pickering explained.
“We favour long-term investments that can deliver reasonably certain income streams over a long period of time. The fund has grown from $8 billion 10 years ago, and every $100 that was invested in ACC about 12 years ago is now worth around $1,200. We do this by investing in New Zealand and its businesses; 77% of our portfolio is invested in New Zealand, and we’re the largest investor in both the New Zealand Stock Exchange as well as government bodies. That’s the multi-faceted role that ACC plays, but we’re fully aware that we have the duty to do much, much more for our customers.”
Pickering says the organisation had also become too complicated over time and hard to navigate for both staff and customers. Processes became more and more complex as it grew, and it developed technology solutions that suited the organisation rather than its customers. Staff were effectively operating with “one hand tied behind their back”, letters and forms were not presented in clear layman terms, the organisation didn’t allow people enough options to choose how to interact with them, and it wasn’t always available right when the customer needed it.
Pickering says the difficulty in navigating ACC was a key reason behind the public’s low confidence in the organisation, and a well-publicised privacy breach only furthered the lack of trust. He says that this was a “clear sign” of the organisation needing to change, and to become truly fit for the 21st century.
“To do this, we needed to see things more through the eyes of our customers,” Pickering explained. “While we are a monopoly, that is no excuse for poor customer service. In 2014, we developed an overall strategy shaping our future, and that was the largest transformation in our 44 year history. It was all focused on putting our customers at the heart of what we do; modernisation is important, but real transformation is about ensuring we deliver the right services in the right way, at the right time.”
In 2014, ACC surveyed over 5,500 customers and staff and ran a number of workshops asking for public opinions of the organisation. After completing this ‘unprecedented’ amount of research, it saw that customers had clearly expressed the need for ACC to be more responsive, transparent and easier to deal with.
“We put new visions and values in place which were focused on the customer,” Pickering said. “We provided customer experience training to every staff member, and we established a new role of chief customer officer on our executive team. Clients will now see faster decisions and payment on their claims, and we’ll work more closely with them to help them recover. They’ll have more choice in how they send and receive information, and above all, privacy is paramount.
“Enhanced technology is also a key part of our programme and customers will be able to interact with us through multiple channels, whether that’s online, by phone or face to face. This will replace cumbersome, paper-based processes.”
Improvements for dealing with businesses were also made, with information being presented more clearly and concisely. ACC has introduced text alerts when medical certificates are due to expire, and weekly compensation payments are due to stop. It has also opened a customer experience centre in Manukau branch, and migrated 37 million files for 535,000 businesses on to a new cloud-based platform.
“We’ve still got a lot of work to do, but Kiwis are noticing a difference,” Pickering said. “Our overall trust and confidence has increased from 45% in September 2012 to 65% in the last quarter of the 2018 financial year.
“We’re also part of a wider trend in insurance – from ‘detect and repair’ to ‘predict and prevent.’ We’re spending millions of dollars in injury prevention each year, and increasing use of data analytics to make sure we’re delivering to the target audience.”
“This is the future we’re building for ACC – one that simplifies our business, and makes it easier for our customers and staff to work together” he concluded. “To be successful, we need to do many different things at the same time. There is no silver bullet. I don’t want ACC to be the faceless, cold building at the end of the street that’s focused on itself, and not the people that it serves. To do that, we need to capture the innovative spirit that gave birth to the ACC in the first place.”
“My challenge to the insurance industry now is this – do your customers really know and understand what services they can and can’t receive from you? Is the language you have on your websites and policies as engaging as the language your people use in a conversation? There should be little or no difference.”