When Thinking About Innovation, Think Business Outcomes
Insurance Experts' Forum, February 12, 2010
Let’s face it, we all enjoy a good oxymoron, and George Carlin vaulted a few oxymoronic gems—“military intelligence” and “jumbo shrimp”—into popular culture. We even have one in our industry—“insurance innovation.” When I say it, I usually get the same kind of laughter from non-insurance analysts as when I say “I love insurance.” But it turns out that insurers, and a few technology vendors, are looking hard at innovations that drive—and this is the important part—business outcomes.
This week, I got to spend some time in the trenches with insurance claims execs at Enservio’s 4th Claims Innovation Summit. And I gotta admit it—when I was first invited, I thought that it was an improbable word pairing—“claims” and “innovation”—next to each other, never mind in the same sentence! Oh yeah, Nationwide did something pretty interesting with their iPhone claims app, but from what I experienced in my “field research” last summer, what Nationwide was doing had to be an outlier...
I’m going to take a deep breath here ... and admit that as a smart former boss once told me earlier in my analyst career, there’s a good story in being wrong.
Property insurers are looking hard at business technology-based solutions that can improve the big moment of truth for a carrier—the experience around the claim. Enservio hosted a slate of a carrier case studies, a variety of technology applications and providers that addresses the needs of the claims supply chain around roles, analytics and agility, and primary research from market researchers that connected it how to deliver a good experience to the claimant while keeping that combined ratio number top of mind.
There was also tantalizing data; for instance, while Rolex watches represent 1% of watches sold, they represent 4% of the watches in contents claims (thank you, Enservio analytics) or that clothing loss represents the claim that causes the most customer claim dissatisfaction (one of many gems from J.D. Power research).
All this cool innovation talk was crystallized into a single eureka moment in a presentation by Stephanie Kerr, VP of business transformation at CCC when she pointed out that you don’t buy tech so that policyholders will call to tell you how pretty your bill is. Instead, you buy business tech as part of a bigger strategy to do something for your business, like shorten order-to-cash cycles. Too bad this continues to be something that too many tech vendors lose sight of because it’s easier for sales to tout product features when what the insurer really wants is to get something fixed.
Ellen Carney is a senior analyst with Forrester Research, serving B2B technology marketing and sales professionals targeting the insurance, banking, and securities industries. In addition to publishing research focused on the strategies, best practices, and trends in how the financial services industry researches, procures, and deploys business technology, she is responsible for developing the global forecasts for IT budget and spending forecasts for insurance and banking.
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