In a four-part blog series, Jonathan Boylan, CTO, FINEOS, explains why insurers need to embrace digital service to gain efficiencies and to compete on service as well as price and distribution. In this first part, Jonathan looks at the pressures of today’s service environment for Life, Accident and Health Insurers.
1. Why aren’t we responding to the demand for digital service?
Leading digital brands have set the bar high.
Amazon, Facebook, Google and other leading technology brands have changed the rules. Traditional retailers, transport, banking, and other industries have followed suit. Over the last decade, our expectations for customer service have been turned on their head. We’ve become accustomed to self-service and bypassing human contact for most of our service needs.
The funny thing is that we don’t miss the personal touch. It’s often a bonus if we don’t have to deal with a person when we go buy or service a product, particularly if that means waiting in a phone queue. Not having to deal with service staff has become the norm, especially for routine processes.
We often talk about millennials being the ones driving demand for digital service, but in fact the demand isn’t just from a subset of our customer base. Digital service is in demand from the vast majority of customers of all ages. I know I prefer digital for routine service issues with insurers and I suspect many of you do too, and (unfortunately for me) I’m not a millennial. So it’s not enough to put the question into the ‘deal with later’ basket, this is something we’re facing now across our customer base.
The era of AI has arrived.
It’s no longer enough to think of digital service as another name for your self-service web site. AI driven personal assistants like Alexa and Siri have become commonplace. We can use them from anywhere, from home or on the go from our smartphone. They’ve helped to lift expectations even higher, as companies are now plugging into them to provide yet more advanced digital portals and better ways of communicating with consumers.
We’ve never had so many service channels.
And it’s not just the digital personal assistants, customers can contact us by more channels than ever before. It’s difficult to keep up. We have chat bots, messaging platforms, watches, and Twitter. We also have the opportunity to collect more data from Fitbits and other personal devices to improve our underwriting and to better understand our customers.
Even “older” communication technologies like email and text messaging still haven’t been integrated into our service processes and administration platforms. When we do use them, they’re often stored separately from our main systems of record, buried in personal email inboxes where they can be lost, forgotten, or sent to the wrong recipient. Apart from its impact on service, it also creates problems for compliance with consumer privacy and audit requirements.
Our main service channels could serve us better.
Most insurers do digital in some way and some do it well. But the reality is that our industry is still very dependent on paper and the business processes and IT designed to deal with paper. Many of our service processes start with a form from the customer. While in some cases this is now a PDF emailed to the organization or a simple web form, we process these requests in much the same way we did when it arrived by post (and of course they still do). While web forms and PDF’s are better than paper and post (they get delivered more quickly and there is some opportunity to use the data electronically), these approaches largely fall short of what’s required today.
Email, in particular, is a problematic technology. Unlike the phone, emails don’t stop building up when you close the contact center. They’re also not secure; they are easily intercepted, read by unauthorized people, delivered to the wrong person, or not delivered at all.
We’re also very dependent on the phone, using phone queues to ask customers to wait in line to talk to an agent. We expose the internal structures of our organizations by asking customers to choose the department they want to talk to by pressing 1 or 2. Few things frustrate me more than when a service agent explains to me that I need to talk to another department in their organization because they can’t help me.
Pitfalls of adding digital with minimal disruption.
Many insurers have attempted to add digital service with minimal disruption to existing business processes and IT infrastructure. In these first passes, they often take paper forms and put them online, basing online design on those paper forms, which rarely works well. We plug those digital forms into business processes designed to be driven by post. While well intentioned, this practice is courting disappointment from a service perspective.
When we post a form (or even email it), we expect a delayed response and a service experience that could take days or weeks. When we complete something online, however, leading digital brands like Amazon have conditioned us to expect immediate confirmation, progress updates and ability to follow up by other channels within minutes of our request. Of course our package won’t be delivered for a few days, but our delivery expectations are set with precision, and if anything changes they’ll be in touch immediately.
When we connect a digital request to a paper-generation business process we are disappointing customers from the beginning. Customers are often left wondering whether the online form was received by anyone or if it worked at all, inspiring thoughts, like “What’s happening?” “Do these people care about me?” “Maybe I should give them a call to see what’s going on.” Quickly customers revert back to the former service model and many of the advantages we hoped to gain from digital disappear, both in terms of improved service and operational efficiencies. Our brands can even be effected by perceptions of dealing with an uncaring, inefficient bureaucracy.
What’s holding insurers back?
Of course it’s not all doom and gloom. Many companies are making progress and there are many things we can do to step up. In the next blog I’ll talk about some of the obstacles we face and look at how we can overcome them.