What are some best practices insurance carriers are using to manage the rapidly evolving mobile technologies? PropertyCasualty360.com asked several leading analysts and consultants for their views on what insurance carriers need to do to gain better control of their mobile users—both internal staff and policyholders.
Analysts such as Craig Weber of Celent; Karen Pauli of TowerGroup; Frank Petersmark of X By 2; Gerald Shields of Robert E. Nolan Co.; Mark Breading of Strategy Meets Action; Stephen Applebaum of Aite Group; Kimberly Harris-Ferrante of Gartner; and Ellen Carney of Forrester Research responded with their thoughts on the subject of best practices in mobile technology.
Craig Weber, CEO of Celent
Beyond the obvious advice—you should be thinking about mobile, because your customers are—it’s hard to generalize about mobile strategies. Companies can leverage mobile in all sorts of ways, and it’s a rapidly evolving space. But I believe clear best practices at this point include:
- Avoiding analysis paralysis. The temptation is to think of mobile apps as having the same clock speed as more typical insurance apps. Theydon’t. Get moving.
- Building some internal capabilities. There are unique aspects to mobile UI design, real-time integration, and getting value from the data streams that come out of mobile app development. If youdon’t have the skills in-house, you’ll probably face constraints as your understanding of mobile business models evolves.
- Develop clear use cases that mobile can address. Are you aiming your app at neurotic customers who check their policy values hourly? Or at people actively involved in a purchase (including agents)? Or at your best customers, with whom you’d like to develop deeper, more lasting relationships? You’re better off addressing any three specific use cases well than 15 poorly.
Leading insurers are partnering with technology providers that have specific and focused mobile competencies. This comes from the realization that it is not realistic to keep up with the requirements around the rapidly evolving mobility space, particularly in terms of such things as security and platforms.
Some insurers believe that internal development of mobile capabilities is how to keep younger IT workers engaged, but for the most part that is allocated resources to a sandstorm of continually shifting skills and competencies that the majority of insurers cannot afford.
An adjunct to this is that when insurers are choosing technologies that have a functional relationship to mobile capabilities, such as core billing, claims, and policy admin, or customer communications, one of the key qualification points should be the vendors’ articulated mobility strategy.
Insurers cannot adopt core systems that are architected around a “nothing prevents it” capability. It must be with a vendor that can state and demonstrate a studied and purposeful architecture that supports mobile adoption of functionality.
At this juncture, very few vendors can afford to ignore mobility and those that do, should generate warning flags at insurers.
Frank Petersmark, CIO Advocate, X By 2
The adoption of mobile technologies by the insurance industry continues to be a double-edged sword. On the one edge, mobile technologies and the family of capabilities around them—consumerization, BYOD, mobile apps, social media, etc.—present significant opportunities for insurance carriers to expand their product, market, and customer service capabilities. On the other edge, the business technology platforms of most insurance companies are ill-equipped to effectively manage such things.
Dealing with savvy consumers in a mobile world is the new reality for insurance companies, and among those taking up the challenge there are some emerging best practices.
- Many insurance IT divisions are starting to reorient themselves away from rigidly structured applications and organizations and toward a more holistic portfolio of integrated services and applications, and more collaborative organizational structures that lead to the more rapid response times and flexible platforms required in the mobile world.
- Insurers are paying much closer attention to their back-end capabilities, particularly data, security, and infrastructure, all in an attempt to facilitate the integration of mobile data—structured and unstructured—into their core systems.
- Carriers are staffing for social media interaction with customers for customer service, marketing, and even damage control. Helpdesks are being turned into social media hubs, with the ability to communicate and respond via chat, email, Twitter, Facebook, etc.
- Many insurers are now accepting the BYOD model as part of the new mobile paradigm, and are adjusting their employee policies and platforms to accommodate.
Those insurers oriented toward the new mobile world will use their sword to their benefit and the benefit of their policyholders, agents, and employees. Those who don’t will see that sword used against them.
Gerald Shields, IT practice director for Robert E. Nolan Company
Adoption of mobile technology by customers, business partners, and employees is rapidly outpacing carriers’ capabilities. Best practice carriers are responding by developing a comprehensive strategy covering the full range of mobile technology issues beyond just “what applications to put on mobile devices.”
This strategy must guide important decisions such as: platform selection, consolidated development (e.g., single app deployed to multiple platforms), securing data, BYOD policies, and how mobile and web apps should work together.
The first step, as always, is to clearly understand business value, business requirements, and priorities. We are helping carriers implement a framework that addresses all the components necessary to successfully build, deploy, and support mobile technology, devices, infrastructure, developers, testing, and maintenance—with a focus on business results and long-term sustainability.
Mark Breading, partner, Strategy Meets Action
One of the best mobile technology practices in insurance is what I call capability bundling. In the early stages of building custom mobile apps, it was typical to focus on a single purpose—things like agent locators, first-notice-of-loss, and financial calculators. These apps helped insurers gain experience, but the download and usage statistics were often low.
Mobile device users typically download apps that they plan to use frequently. Some of the early insurance apps were, by their very nature, low usage apps. For instance, once you have located an agent, you usuallydon’t need that app again. And no one really wants to think about needing an FNOL app.
Increasingly, insurers are bundling related capabilities that deliver more value. The results are more downloads and usage.
For example, some individual apps allow policyholders to track vehicle maintenance, arrange for a rental car, submit an FNOL, locate a towing company, contact an agent, and get new car information.
Not all of these capabilities are purely insurance transactions, but they are logically associated with the insurance needs of policyholders. Bundling related capabilities is a win-win approach for both customers and insurers.
Stephen Applebaum, senior analyst, property & casualty insurance, Aite Group
One of the many innovative uses by carriers of mobile technology that I have seen lately involves online auto damage repair estimating. Several early stage entrepreneurial web-based companies have come to market offering auto repair estimates to users who submit smartphone photos of vehicle damage.
These online estimating services enable users (including policyholders, agents and adjusters) seeking an auto damage repair evaluation to generate detailed, accurate estimates using a simple, user-friendly online tool with little or no auto body repair experience.
Users can determine if repair damage exceeds the deductible and obtain quality referrals for nearby auto body shops within their managed network of qualified and reputable auto body shops. Auto body shops benefit from the speed, accuracy and ease of use of the tool and the referrals.
The service is most attractive to insurers in the case of low value (under $1,500) auto damage claims, which represent the majority of auto damage claims. Several large auto insurance companies have begun testing programs in partnership with these companies in which they refer policyholders reporting low level damage during the first notice of loss process to the online service in order to get a quick initial estimate before determining how to proceed.
Because consumers have been increasing their collision deductibles to reduce insurance premiums, a large percentage of low level auto damage claims now fall below the deductible so a referral to a quality repair facility is a valuable and welcome service to such vehicle owners.
For carriers, the potential for savings in terms of field adjusting staff and internal claims handling staff is significant as is the opportunity for improved customer satisfaction.
Kimberly Harris-Ferrante, vice president and distinguished analyst, Gartner
Mobility is becoming widespread within the p&c insurance industry. According to a Gartner study conducted in 3Q11, approximately 50 percent of p&c insurers in the US and Canada were investing in mobile technologies and devices at year-end 2011, with an additional 31 percent of insurers planning investments in 2012.
Many insurers are facing hardships around mobile strategy development and launches. The key to success is focusing on initiatives which produce solid returns on investments, proactively assessing speed of mobile adoption, and ensuring existing systems and IT staff is sufficient to support mobile development/maintenance.
While customers may have greater visibility and appeal at first blush, most will find greater returns on investments targeting mobility with distributors and partners who are demanding greater device support. Additionally, many companies are exploring bring-your-own-device (BYOD) policies for both employees and distributors which will demand mobile support as a result. Both are driving forces behind mobile deployment.
Core systems (e.g., quoting engines, policy, claims and billing) must support real-time access for transactional needs. Companies running legacy systems will find mobile enablement difficult and user expectations unmet.
Modern core systems with real-time processing engines and portal support are essential. Furthermore, companies will need mobile development teams within the IT department to build mobile applications and/or extend portals to mobile devices.
Staffing may be lacking or expensive to train/recruit, leading some companies to outsource mobile projects to IT services companies. Mobile maintenance is ongoing and must be up to speed with changes in consumer electronics, therefore an expensive skill set for many mid-to-small insurers.
Ellen Carney, senior analyst. eBusiness and channel strategy, Forrester Research
Usability testing is an area that’s overlooked in a lot of mobile strategies, but it will be critical in moving mobile from being fun experiments to delivering real business impact.
Usability testing ensures that customers can find the content they need and functionality to help them execute the tasks they needdone.
Begin by placing popular and critical elements on the opening screen. Test page layouts for specific onscreen placement, the formatting of lists and search results, and the balance of text to graphics.
Anddon’t forget to think about your usability testers—if you have employees that fit your mobile customer profile—they are often willing to provide unvarnished opinions into what you could havedone better.