Mobility continues to soar overthe technology world as well as provide business value to insurersbecause of its direct connection to business transactions and coresystems.

 "It's a way to put new channels out there and extendcore systems to the marketplace," says Mark Breading, a partnerwith the research and advisory firm Strategy Meets Action. "Therehas been a steady increase in the business value for insurersthrough mobile technology."

Insurers as diverse as Progressive Insurance andElectric Insurance have worked diligently through the past year tofind ways to improve connection with their business partners,customers, and potential customers as well as extend theirconnection. Insurers have for years stated their case to be valuedpartners to customer wherever and when ever the customer wants toreach them. Mobile technology has taken that promise ofconnectivity to a new level.

When Electric Insurance began studying requirements for a mobileapplication, the company spoke with solutions provider Agencyportabout what the vendor was proposing to do in the mobile space andCIO Tom Stumpek discovered Agencyport's plans fit with Electric'srequirements.

"We wanted to develop an app in the iOS platform and theyalready had the foundational code," he says. "There were somefeatures we wanted to serve our customers such as roadsideassistance and windshield repair. They had the core components andwe had some integration work on the back end, but this seemed themost logical way for us to go. The cost and implementation timewere good—only eight weeks for the whole project. By IT standards,that's pretty quick to market."

Progressive Insurance prides itself on providing insurancethrough multiple channels. With technology benefitting both thedirect and agency channels, Progressive is looking to capitalize onsome of its mobile technology investments to serve multiplechannels.

"We are having success in tools that cross over," says MattLehman, mobile business leader for Progressive. "As we build outcertain capabilities, clearly we are looking for those to bechannel agnostic. When you look at the servicing and claims'capabilities that are built into both our apps as well as ourmobile Web—things like severe-weather text alerts or the ability toview policy coverages—we want those to be available to allcustomers regardless of how they choose to work with us."

WHAT CUSTOMERS WANT

Progressive isn't afraid to build certain capabilities strictlyfor one of its distribution channels, but Lehman believes it allcomes down to ways for customers to use mobile technology to makethe insurance process easier.

"If a customer chooses to work with one of our 35,000independent agents, that's great and we want to put tools like thenew FAO (ForAgentsOnly) effort into agents' hands so they can bemobile," says Lehman. "On the other hand, if a customer wants towork directly with us and use the device in their hands, we want tooffer tools that will make that easy as well. We certainly look forcrossover opportunities and in certain cases we may releasesomething for the direct channel, which ultimately will cut over tothe agency channel as well."

As Progressive goes through the process of developing thesetools, one thing that is consistent between both channels,according to Lehman, is communicating with the respective audiencesalong the way. "When we are building a directexperience, we are going to listen to what our existing customersor prospects are telling us and think about ways to optimize thatexperience," he says.

It's the same with agency tools.

"A lot of these applications were vetted with our agencytechnology council over the last year, so we understand from amobile standpoint what they are looking for. Are [agents] more aptto sit across the table from a client or prospective client with atablet or a smaller device? We heard they were going to use tabletsso that's why we went out and built this [FAO] capability on iPadstoday and it's coming to Android tablets in the not-too-distantfuture."

The goal for Progressive is to enable agents to bring newclients onboard so they can quote and bind policies in a similarmanner to what they might do at a desktop.

"They can certainly provide a rate, go through the buy process,provide the basic servicing capabilities, and run reports so [theagents] can look at the makeup of their Progressive customer base,"says Lehman.

CARRIER USES

Insurers are finding ways to provide agents, adjusters, andother third parties with mobile capabilities, according toBreading.

"There are interesting things going on in terms of iPad apps foradjusters and even life insurance companies," he says.

In Canada, he points out, paramedics that collect medical datafor life insurers typically are independent and often representmultiple companies. An iPad app was developed so the data they arecollecting is uploaded in the field.

"They just select the carrier and the company logo is on theform," says Breading. "It's pretty much the same data beingcollected from all the policyholders, so it is straightforward andsimple."

Some insurers are using mobile technology for loss controlinspections.

"They don't just fill out automated forms; they can take apicture of the property and attach it to the file," saidBreading.

Progressive earlier this year went outside its own research anddevelopment area to purchase software from technology vendor Mitekto help boost the direct line by allowing customers to submit aphoto of their driver's license and the VIN for a particularvehicle and get a rate back through their smartphone.

"We still need all those data pieces about [a customer] in orderto provide an accurate rate," says Lehman. "We also are looking atways to make that input process easier. When you look at how mobiletechnology is evolving, one of the big ways is around the use ofthe camera—making deposits to your bank, scanning a QR code—so wewanted to expand on that."

The image capture allows a customer orpotential customer to take a picture of their driver's license forprefill and another picture of their insurance card to get the VINor scan the VIN off the car itself.

Progressive's history of using technology and trying to be firstto market to make things easier for customers and independentagents means Progressive often gets approached by companies withpossible software solutions, explains Lehman.

"This was a situation where we were looking at ways to usemobile technology in the quote process," he says. "We saw whatMitek was doing with remote check deposit and we were able tostrike a really good partnership between us. We bring a lot aroundthe user experience with a powerful rating engine in thebackground."

Progressive seeks to deliver an accurate, viable rate, not aballpark rate based on what Lehman calls "a ton of assumptions thatlikely will change. We want to get you through the process quicklyand easily and we want to give you a rate you can purchase rightthere on the phone if it is good for you."

Progressive is happy with how the technology and the back-endsystems are working together and the carrier looks forward togrowing this solution.

"It's all about speeding up the process of getting a rate andmaking it easier," says Lehman. "Will we expand that over time?Today we are in the introductory period. We are looking to expandit in more states and we are hearing good results from those thathave used it, but right now we are focused on making it as good aspossible for those early adopters."

Fitzgerald believes the new Progressive function goes beyond thecoolness factor.

"It really saves people steps and makes it easier for them toaccess the carrier," he says. "It's a great example of not justtaking an existing process and putting it on a mobile platform, butreally being able to make it work. You add the prefill and you knowthey are on a public network so you can pull in that other data.That's innovation, not just improvement."

OTHER USES

One of the mobile features that Stumpek believes will makeElectric stand out is visitors can find an electric vehiclecharging station through the Electric app.

"We found that was an emerging market for us," he says. "Sincewe insure GE fleet services, one of the value-adds is the charginglocater. We've put a GE charging station in front of our building.Electric vehicles are taking off and charging stations areneeded."

Existing customers can log-in through the Electric app withtheir user ID and password and pull up all their insuranceinformation. Once they are logged in, the mobile account has theirinformation and allows customers to perform tasks such asprocessing an auto claim.

"It's a neat application where you select acar model and there's a thumbnail of it," says Stumpek. "You tap onthe areas damaged and add your own photos. It is sent to our claimssystem and we immediately start a link. The other thing we do isglass replacement through the app and you can schedule yourappointment. These are some of the services we want to provide ourcustomers."

Down the line, Electric is looking at a number of ideas, but thecarrier didn't want to start out with too much going on.

"We have close to 2000 downloads so far," says Stumpek. "Thesecond day we actually filed a claim and the customer said it wasseamless. A quoting system can be fairly complex, especially if youwrite in all 50 states."

EXPANDING ITS REACH

Breading believes mobile technology is becoming more pervasiveas it moves down from the tier one companies. There are manytier-two insurers—$1 billion to $5 billion in direct writtenpremium—that have mobile apps in the marketplace.

"There are not many of the tier-three insurers that have custommobile apps," he says. "The most they may have done is to maketheir Website mobile friendly so people can use the existing Webcontent on their smartphone. That's a preliminary stage beforecreating custom mobile apps and definitely is a good firststep."

Breading sees plenty of vendors that can help smaller carriersmove into mobile and maintains that those carriers might be foolishto try and do it themselves.

"There are a lot of companies that provide those translationcapabilities," he says. "The same is true for mobile apps. Thereare a lot of vendors out there that can test [the product] so theyknow it will work on all the current platforms and they are goingto take advantage of the interaction capabilities. You are not justbuilding a Web-based HTML application. You want something thatoffers touch-screen capabilities."

Independent agents are saying they want to be mobile, accordingto Fitzgerald.

"In the surveys we've done around producer technology, they saythe number one thing is give them what they need or give thecustomer what they need so they can enjoy better customer service,"he says. "Mobile fits right in there."

Chad Hersh, a partner with the research and advisory firmNovarica feels it is important that agency writers offer mobileconnectivity to their customers.

"You can't afford to skip the consumer channelbecause consumers expect you to behave like a direct writer whetheryou are or not," he says. "If you are an agency writer, there is anexpectation that you are going to both provide access to the agentto support you and when the agent is not available, you are goingto offer options. Technology when you want it; people when youdon't. I think everyone understands that if you are a direct writeryou need to provide an agent-like experience and if you're anagency writer you have to provide a direct-like experience. Peoplewant what they want when they want it."

OPERATING SYSTEMS

Many companies are gambling on one mobile operating systemtaking over the market, but Lehman points out the mobile market isstill too fractured with key players developing their ownsystems.

"As far as agents and what the mobile FAO will cover, certainlyiPad has the lion's share of tablet usage today," says Lehman. "Weare seeing Android make some inroads with the Kindle Fire, forexample, the Motorola Zoom, and the Galaxy Note tablets. Byoffering similar functionality, those operating systems will coverthe vast majority of the tablet market."

The handheld market is more evenly split, according toLehman.

"We see pretty broad coverage on both iPhone and Android," hesays. "Our goal there when we think about the consumer is to bepresent from the app space with iPhone and Android apps. We have arobust mobile Web offering as well and that is device agnostic, soif you have a BlackBerry or Windows phone you can access the mobilecapabilities."

Choosing which operating system to build an app can be a toughcall for an insurer.

"What you are looking for when you build an app is the cost andthe market share," says Hersh. "If you are building a fairly robustapp like Progressive's latest with the capture-the-image of thedriver's license to get a quote, it's surprisingly easier to dothat on an iOS device because you know what hardware is there.Every iOS device has a camera except for the original iPad. You canbuild an app for the iOS that says it works for everything but theoriginal iPad. When you build something for an Android phone youare looking at hundreds of variations and Android tablets havedozens of variations. They all have different hardware specs anddifferent versions of Android. It's much harder to build forthat."

Novarica typically advises insurers that if they only haveresources to build for one operating system, do iOS. If they haveresources to do two, do iOS and Android.

There are platforms that will allow carriers to build theunderlying application and then port it to both operating systems,according to Hersh, and there is the option for certain smallercarriers who want to do both can create an application that runs anHTML5 Website—a mobile Website that looks platform specific to theend user, but in reality is more a skin.

"The problem with that kind of app is it runsremotely and people aren't always connected," says Hersh. "Peoplewant their apps to work on or offline within reason. That beingsaid, for security purposes most carriers don't want any datastored on a phone or tablet anyway, so it is a reasonably appealingoption. Things are slower to load and it is not going to be ascool, but it solves problems from a cost perspective and a platformperspective."

One of the drivers to selecting the iOS system was that a lot ofElectric's known customers—mainly GE employees—have a mobile devicethrough GE and it's usually either a Blackberry or an iPhone.

"We didn't feel it was that important to get it out on theAndroid platform right away," he says. "I saw some data fromForrester that Android will surpass iOS devices in thenot-too-distant future, so it is on our roadmap to get on theAndroid platform."

WHO'S DOING WHAT

Fitzgerald sees software companies working to get their existingofferings on a mobile platform, although new functionality is notthe priority for now.

"It's not very innovative, but they know they need to have theirsolutions on the mobile platform," he says.

As for the carriers, having some mobile connectivity is anecessity and is expected of them by consumers. Fitzgerald worriesabout smaller carriers and the position they have been placedin.

"This is another example where the smaller and regional carriersthat haven't updated their technology platforms are going to be ata further disadvantage," he says. "Some carriers got to the Web ina clunky manner with an old infrastructure behind it. It's moredifficult to take that approach with mobile and be sustainable.Mobile is another wedge being driven between the technologicallyprepared and the non-technologically prepared organizations."

The majority of mobile technology development is being done inhouse. Hersh explains it is not a big stretch for an IT staffer togo from being a typical Web developer or application developer todeveloping mobile apps.

"With something cutting edge like image capture and recognition,it may be best to go outside," he says. "A camera on a particulardevice may always be a challenge. There are certain things you wantto have core competency around, but there are pieces that areoverly complex, just like with regular applicationdevelopment."

Hersh agrees it is another area where mid-size and smallercarriers are at risk.

"Consumers don't expect any less of them because they aresmall," he says. "Will a big direct writer always have a better,snazzier app? Sure. Do consumers necessarily care about that? No,as long as they can get what they need to get done on the app, theyare generally going to be happy. That being said, historically whatwe've seen happen is vendors—particularly policy vendors—tend toadd these functionalities as a differentiator so they can go tocarriers and say, 'If you use our system you would have a mobileapp by now.' I think we'll see more of that from policy vendors,portal vendors and stand-alone app vendors come out stronger in themarket. There will be options, but you have to have something outthere now or really soon."

THE FUTURE

Mobility has to move up on the priority list for carriers thathaven't started yet, according to Hersh.

"It's likely that the iPad 3 will cause another surge of tabletsales," he says. "Phones coming out are quad core and the averageconsumer doesn't even have a quad core desktop yet. The power ofthese devices is bordering on more than we need. My phone hasbetter bandwidth than the fiber optic connection in my house. Ithas a dual-core processer and puts the resolution on my desktop toshame. Consumer expectations are growing and their generalcomputing needs are going to be met by apps. It's a good sign whenyou see Geico, Progressive, and Bank of America all touting mobileapps in advertisements. That means others will have to follow."

The insurance industry is in a period of unparalleled technologyadoption and innovation, according to Lehman.

"Given our lineage of trying to be at the forefront of usingtechnology to make insurance easier, it's an exciting time forconsumers as well as independent agents who can embrace thistechnology," he says.

Breading believes there is going to be a lot of progress inmobile implementations this year.

"Mobile is moving way beyond the experimentation stage," hesays. "Real, live, beneficial apps are put up not just forcustomers, but for business partners and employees. A lot ofcompanies—the big ones especially—that have been in this for acouple of years now are looking for ways to bundle the content sothey can have rich mobile apps that provide value for theusers."

Breading predicts the number of carriers using mobile won'tincrease significantly this year, but he feels the richness of themobile functions will improve.

"If you are a $250 million insurer—even a half billion dollarpremium insurer—it is really hard to figure out how to prioritizethe advanced technology," he says. "You have just enough budget,resources, and skills to maintain your core systems to run yourbusiness. My advice is to not look at the lines as a mobile app,but as mobile functionality that is being delivered. I don't expectto see a huge shift in terms of carriers using these because if youlook at the smaller insurers—of which there are a lot—they are justnot going to be there yet. The ones that have already experimentedare going to go to the next step and make it richer and improve theuser experience and user interface."