Over the course of 2020, the insurance industry and its various participants, from brokerages and agencies to insurtechs and carriers, have had to undergo a significant shift in how they do business, thanks to the coronavirus pandemic. Since the crisis is far from over, 2021 will likewise be colored by ongoing changes within insurance organizations as they continue to adapt to the new normal.
During a panel at the Future of Insurance USA event, leaders from the industry sounded off on how their companies have changed so far, as well as what strategies and processes are helping them keep pace with the many developments in the marketplace.
“We have this interesting hybrid approach to innovation. We use focus groups, and primary and secondary research like everyone else, but we have the advantage of having all of these financial representatives – our advisors – that are essentially running constant tests. They’re always trying to figure out what’s the best way to serve their clients, so we can tap into and leverage those on-the-ground insights,” said Christian W. Mitchell, EVP and chief customer officer at Northwestern Mutual.
He added that Northwestern also holds a unique position in the market as a mutual company, in light of which, he noted, “We are in the process of thinking about what are the metrics to capture whether a client is better off having worked for us, as opposed to working for anyone else, and embedding that in our corporate metrics, what we report to the board on, and where we hold ourselves accountable.”
Meanwhile, at Tokio Marine HCC, the focus when innovating during the recent crisis and beyond has been all about improving the stakeholder’s experience – whether that’s brokers, insureds, or employees – by providing digital ‘basics’ online, like First Notice of Loss and self-services, as well asO for brokers specifically, thinking more concretely about the renewal and submission processes.
“Renewal retention is such a big way to drive and improve results at a specialty insurance company, so how can we make that process easier and drive a higher retention ratio?” said Susan Rivera, Tokio Marine HCC’s CEO. “With the COVID situation, [we’re also] looking at triaging submissions – how can we bring submissions in more effectively, supplemented with third party information, making it easier for the broker and being able to promptly get back to brokers on new business submissions of what fits our appetite and what doesn’t fit our appetite?”
As carriers think about a post-COVID world, a few key items rise to the top, including a continued commitment to digitization and engaging with clients in a variety of new ways – and doing all of this faster than ever before. After all, one of the lasting impacts of COVID has been acceleration, noted Mitchell. Luckily, insurance companies have already proved that they can move a lot faster than they perhaps thought was possible before the pandemic.
“We’re going to execute faster … and from a client’s perspective, I think one thing I would highlight is the need to have a multi-channel approach to client service,” continued Mitchell. “As the boundaries between home and work are blurred for everyone, clients are now going to demand to be able to interact with their advisor or their company, and do an address change or read a piece of content whenever they have a spare moment – that might be at 10 o’clock in the morning, that might be at 9:30 at night.”
He believes that COVID is likewise going to place a greater premium on financial and brand strength, since after going through volatility, people are going to want to work with companies they can trust and that they know will be there for the long-term. A great reliance on data will also be part of the insurance industry’s future, added Rivera, particularly in the specialty insurance space. Clients want their insurance partners to know them – know, for instance, that they already hold two policies with a carrier, or that they’re about to do an acquisition.
“They want you to have that knowledge and bring an insurance policy that’s more complete and responsive … to what their needs are,” Rivera said, adding that she simultaneously sees a growing reliance on risk management tools and other resources that can help clients reduce losses, whether that’s in workers’ compensation, with wearables, or in cyber insurance, with a whole host of risk mitigation software and training.
“They want to have a true partnership because [nobody] wants to have anything impact their business,” she continued. “They want to accelerate and move forward, so how can we make sure that they avoid some of those unnecessary bumps in the road from a risk perspective?”