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Social business-report-general-health-insurance


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The general Consumer perception of Insurance companies is that of being traditional in their methods and autocratic in their outlook. Operating in a heavily-regulated industry and with increased Industry competition, Insurance companies need to seek innovative and effective new means to acquire, engage and retain the Consumer. The emerging online platforms have to be fully embraced by them and a clearly defined strategy of how to engage online has to be implemented and maintained.

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Social business-report-general-health-insurance

  1. 1. Social Business General & Health Insurance Industry
  2. 2. Social Business - General and Health Insurance Industry Page | 1 Contents: i. Executive Summary ii. Current Situation iii. Social Business through the Value Chain iv. Health Insurance Industry v. Engagement Case Study vi. Conclusions i. Executive Summary David Williams of Axa Insurance UK was recently quoted as saying that the UK Insurance Industry was “traditionally known as not being the most responsive to change.” 1 This comment could be applied in a general sense to many Insurance Companies throughout the globe. Traditionally, Insurance Companies have focussed on customer acquisition, customer service and renewal, claims handling and product development. A consumer would typically have two touch points with their Insurance Company: at the time of acquiring a policy and again at the time of renewal of the policy. Other touch points would, in the main, be instigated by the Consumer, the most common being informing the company of a change in circumstance or instigating a claim. The social business model is rapidly evolving into social business strategy and Insurance companies are now aware that, to manage the online conversation about their brand, they have to interact and respond to the Consumer to Consumer about Business (C2CaB) community. Online activity is instant and whilst Insurance companies have, in the past, adhered to caution when addressing a query and have had the time to format a reply under regulatory guidelines, they now have to find a way to respond in real time whilst ensuring that the compliance requirements of the industry are met. This challenge is huge for, as David Williams notes above, these Companies are not traditionally responsive to change. So how can it be managed and what are they doing to interact and to retain/enhance the traditional brand recognition they have painstakingly worked to achieve? The approach to social business involvement has been varied amongst Insurance companies globally. Nick Smith of Accenture UK reasons that some companies are still pondering the 'Why get involved stage' whilst others are immersed in the ’How do we get involved stage'. As a panellist on a recent Market force Webinar2 he agreed that companies need to make a clear commitment to social business and define their goals and objectives with a concise strategy. 1 2
  3. 3. Social Business - General and Health Insurance Industry Page | 2 The Health Insurance industry is mindful of combining the need to be accessible and engage with the Consumer with current regulatory requirements that are fragmented by Country/Region. The personal nature of the Industry, i.e. peoples’ health makes providers ever more cautious when engaging on social platforms. The social business potential is huge, however CBO3 estimates, for example, that there are about 150 million Americans under the age of 65 who currently have an employment-based health insurance plan as their primary source of cover. They also estimate another 13 million people have primary health insurance cover purchased directly from an insurer. PWC take this further in their Healthcare Report4 where they state “Health insurers understand that focusing on the individual population will be key as more partnerships in population health are formed and insurance exchanges bring in 12 million newly-insured individuals in 2014 and up to 28 million by 2019.” This Paper sets out findings and observations arising from a review of the areas of the social Business Model that can add value to Insurance companies. It also looks at existing strategy and how it is administered in Countries such as Australia, Ireland, U.K. and the U.S. ii. Current Situation Ernst & Young identified the global insurance outlook for 2012 as: 5 “The general outlook for the global insurance industry is mixed, a consequence of persistently challenging economic, market and regulatory circumstances. Other than Asia Pacific, where continued growth is expected in 2012, the rest of the world is mired in economic instability.” From a European perspective they found that: 6 “Consumer needs and expectations are rapidly changing. These forces are combining to create considerable challenges for insurers seeking to improve both top- and bottom-line performance. Those companies that have a deep understanding of these challenges, and respond with strategic solutions, will outperform their peers.” They also commented that, in the US: 3 4 5 Overview 6 Europe-insurance-outlook
  4. 4. Social Business - General and Health Insurance Industry Page | 3 7 “The scale and efficiency of insurer operating structures are eroding the ability of many companies to respond to emerging opportunities. As the US property-casualty industry confronts these macroeconomic conditions, it is also challenged by regulation, and an uncertain governance and compliance agenda.” As it is less within the control of companies to manage the global economic situation or prevent natural disasters, the key area a company can improve is the relationship with the Consumer. Ernst and Young joined forces with independent firm IPSOS between August and October 2011 to canvass 24,000 consumers globally to enquire about what drives consumer behaviour in the Insurance process. A key finding was that, although the level of online purchasing of insurance is generally low globally, a significant number of Consumers will conduct their research on the Internet before purchasing their insurance through the conventional channels. Figure 1 The % of respondents who research Insurance online by Country. The UK is ahead of the other Countries shown as it has an already developed comparison site structure, whereas the US is less mature, resulting in a weaker percentage. The online desire and capacity for research is emphasised by those regional respondents who indicated that they wanted to make more use of websites for information in the future.8 7 property-casualty-insurance-outlook 8 _The_Americas/$FILE/EY_GIR_AMERICAS_SML.pdf Page 22. 39% 57% 23% 0% 10% 20% 30% 40% 50% 60% Australia U.K U.S % who research insurance online % who research insurance online
  5. 5. Social Business - General and Health Insurance Industry Page | 4 Figure 2 the % of participants who planned to use the internet to research future insurance options. The research established that the majority of participants found the option of being able to communicate personally important, especially if the query/purchase was a complex one. Having access to multiple resource channels and highlighting the CHOICE factor led the report to state: 9 “Customers expect insurers to integrate different methods of communication; they want to be able to choose the communication method that suits them at the time and for a particular purpose, and to switch between channels without repeating part of a transaction. “ With the focus on the online sector, the report also indicated that the choice of communication methods should extend to the extensive technological platforms being utilised. The Insurance Consumer market is broad and communicates through web, blogs, forums and social media platforms and the insurance sector needs to integrate traditional communication channels with these rapidly evolving platforms. In Ireland, the Insurance Industry struggled amid difficult conditions in 2011. The Irish Insurance Federation Report of 2012 acknowledged that economic stability, fall in premium income, new regulatory conditions and the introduction of the Government levy, all had an impact on the Industry with non-life premium income falling almost 5% to less than €2.9 billion.10 The Irish Insurance industry, as with other global regions, is increasingly aware of the 9 _The_Americas/$FILE/EY_GIR_AMERICAS_SML.pdf 10 page 7 Americas 28% Asia-Pacific 38% Europe 34% % who want to make more use of websites in the future
  6. 6. Social Business - General and Health Insurance Industry Page | 5 changing trends in product research and purchase by the Consumer. Figures from the January 2012 TNS Digital Life study11 show that a significant proportion of Irish consumers are writing about products online. Figure 3 Source / These results suggest that the Irish Insurance Industry, along with the rest of the world, needs to evaluate its customer strategy to integrate with and manage the C2CaB conversation about brands, in a profitable way. Insurance brands/companies interact with the Consumer at various stages in the lifespan of an Insurance policy. The next section considers the stages within the value chain and how social business is managed throughout the process. iii. Social Business through the Value Chain As mentioned above; the main stages of the Customer Value Chain are: a. Customer Acquisition 11 / spring-2012/brand-conversations/ 51% write about products 44% post for advice 15% post to praise 12% post to complain 74% join brand community for special offer
  7. 7. Social Business - General and Health Insurance Industry Page | 6 b. Customer Service and Renewal c. Claims Handling d. Product Development Insurance companies focus on these areas to maximise ROI and control cost. These stages have historically been managed from the Insurance side; however, with the increase in activity through social business, they now have to re-define online strategy to incorporate C2CaB. a. Customer Acquisition Two key issues are relevant to customer acquisition 1) how to capture the customer in the first place and, 2) how to attract the customer to the company. 1. Capturing the Customer In the US, in a recent Insurance Shopping survey by J.D. Power & Associates, their insurance practice examined the habits of over 16,100 Insurance shoppers in the States. Mark Garrett from J.D. Power & Associates noted that:12 “With retention and satisfaction with insurers at high levels, many of the people who are simply "price checking" are taken out of the market. However, of those who are looking to switch, 34% are looking to complete the process, from quoting to closing, entirely online. This number is up from last year, and increasingly correlates to success in customer acquisition.” The important point is that the online system must be accessible and usable by the customer to achieve his/her objectives. It is surprising, for example, how many companies refer a Customer to an operator whilst they are seeking a quote online, rather than providing the actual quote. This is not good practice because:  The customer may not want the hassle of switching to an alternative form of communication in order to take the quote further.  Insurance companies invest in online analytics; switching online customers offline means they are not utilising this tool effectively.  The customer will feed back his/her experience through social media thereby immediately creating a C2CaB conversation that could be potentially damaging. A New York based user-experience firm - Corporate Insight - released a report in January 2012 on eight Insurance firms, evaluating their quote process online. It identified positives 12
  8. 8. Social Business - General and Health Insurance Industry Page | 7 in Allstate’s13 ease of use and attractiveness and commended the ‘get live help’ feature providing the Customer with an option to go further with their enquiry. Statefarm14 in Illinois also stood out for their features at the end of the quotation process. They offered a choice of policies and described the pricing discounts and benefits of each and they also automatically assigned a local agent to the quote and gave the Customer the option of either progressing online or through the agent. Ohio based Progressive Insurance offers a unique feature at the start of the user’s online experience - it invites the Customer to ‘Name Your Price’, saving time when it comes to sifting through policies. Corporate Insight credits Geico15 (Government Employees Insurance Company) with its clear discounting structures and observes that, if this was combined with Progressive’s ‘Name Your Price’ feature, it would be of optimal benefit to the Consumer. These examples of enhancing the basic online quote infrastructure benefit both the Consumer and the Company and set the groundwork for a positive C2CaB. 2. Attracting the Customer to the company With the focus purely on social business, the issue of attracting the Customer can be examined through:  Branding and Recognition The Insurance industry is commonly regarded as somewhat unimaginative as far as marketing is concerned. To improve and compete, the industry needs to become more innovative and creative in the way it portrays itself. A popular way is to launch a Campaign: Allianz was named 67th in the Interbrand 2011 overall global branding. The brand is now worth in the region of €5.3 billion as a result of its work on brand recognition. The Company explains: 16 “Interbrand affirmed Allianz’ brand strength, customer focus and credible brand promise as the core of its success. In particular the latest communications campaign “One”, which gives a human face to the brand, received the highest recognition from Interbrand. For the second year in a row, Allianz was ranked 67th in the overall global 13 14 15 16
  9. 9. Social Business - General and Health Insurance Industry Page | 8 ranking. The Allianz brand is now valued at some EUR 5.3 billion, an increase of 9%” The 17 “One” Campaign centred on one of the core values of the Company in caring for the customer. This was shown by both employees and customers sharing knowledge and experience in authentic situations. Whilst the Campaign was pushed through the traditional media channels it also focussed on the digital media channels utilising a dedicated YouTube channel, a specially designed website and a smartphone app. The 18 YouTube channel has just fewer than 1.3 million views which for the traditional Insurance Industry is a significant amount. Joe Gross, Head of Global Market Management SE states: 19 “In order to really share knowledge, the "One" campaign makes broad use of the digital space. “One" encourages dialogue, engagement and participation by being online and interactive and by incorporating user generated content. Other delivery channels include press, TV, billboard and a global airport campaign. Local adaptations use the different channels with different emphases; however they all use the central "sharing knowledge" theme.” Another way to attract Consumers is through clever use of a mascot. Jeff Charney, Chief Marketing Officer of Progressive Insurance (U.S.) states “Consumers are less likely to have a conversation with a logo or a PR guy on social media,"20 Progressive Insurance have been successful with their mascot ‘Flo the Progressive Girl’. She has a separate Facebook page to the company page and currently has over 4 million likes and over 58,000 talking about the page (Aug 2012). The page does not focus on the Insurance Industry, it engages by uploading interesting photographic and video content whilst ensuring that the ‘Progressive’ name is consistently prevalent. 17 18 19 20
  10. 10. Social Business - General and Health Insurance Industry Page | 9 In the UK, one of the most recognized Insurance mascots is the nodding Churchill dog. Again, the dog, which has been synonymous with engaging TV ads since 1996, has a separate Facebook page with over 34,000 likes and 800 talking about the page (Aug 2012). The Churchill Twitter page, although set up, is not being managed despite having over 312 followers. To verify the authenticity of this page we used the link from the official Churchill Insurance website which took us to the page. This highlights the point that, whilst attraction to the brand is important, managing the engagement and interaction with a consumer through social business is vital. The consumer may hit your page but will not stay if there is nothing with which to engage. Aviva UK have released a smartphone app named Rate My Drive21 . It offers potential Customers the chance to participate in the drive and then receive a customised quote with applicable discounts. This has generated conversation on their social media platforms which has increased their brand visibility and enabled them to attract potential Customers to their website. b. Customer Service and Renewal Insurance traditionally has dealt with Customer Service through less public channels i.e. telephone, email, mail and face to face. Social Platforms on the internet have enabled Consumers to express their views on a brand and the Industry has to adapt to channel this expression profitably. Multi Direction Expression Capability (MDEC) is the way forward when conducting social business. Direct sales through traditional media are now combined with a forward thinking online strategy whereby the Industry has to manage: 21
  11. 11. Social Business - General and Health Insurance Industry Page | 10  Business to Business (B2B),  Business to Consumer (B2C)  Consumer to Consumer about Business (C2CaB) Effective management of social platforms is of paramount importance as the internet is an openly expressive platform for the consumer. Responding to both positive and negative conversation about a brand and managing these responses with honesty and transparency is a vital component of social business. A Company needs to respond and engage online:  In a timely manner  With an appropriate tone that befits the Company ethos  In an open and honest manner  With the right degree of transparency  With content that adds value to the Consumer The Irish Insurance Company,, promotes its Facebook page with questions asking if certain things are ‘nonsense or not’ setting the tone and the theme of the brand. Consumers have interacted with a mixture of queries and complaints and these have been addressed speedily, honestly and the Consumer has been invited to converse on a more private scale.22 The engagement appears to be professional, timely and honest and allows the company a degree of control of the C2CaB that it ultimately would not have, simply because the conversation is taking place on a platform managed by it. In contrast, their mascot Mags has her own Facebook page where the tone is light hearted and in keeping with her character on the TV ads. 22
  12. 12. Social Business - General and Health Insurance Industry Page | 11 With this page the company can jokingly insult the Consumer through the character without causing offence.23 The Australian Insurance Company RACV maintains a Twitter page that imparts information and retweets positive messages from Consumers however it does not engage with negative conversation. This does not prevent other Twitter users from having a conversation with the complainant about the brand and ultimately recommending another insurance company to them.24 Result: potential loss of future business and minimal customer retention at renewal. By utilising social business in an effective manner, brand recognition, customer loyalty and an enhanced trust of the company can all be successfully generated. In the past, if there have been no policy changes or claims, contact with a Customer has been minimal which has generated impartiality at policy renewal time. The Global Consumer Insurance Survey 2012 by Ernst & Young25 in fact shows that there is a lack of effort to retain business at the renewal stage: With increased effort at renewal and a pro-active social business strategy that generates customer loyalty, these figures can be significantly reduced whilst improving ROI. c. Claims Handling Principal applications of social business related to claims handling are: 23 24 25$FILE/Global_Consu mer_Insurance_Survey_2012.pdf Figure 4 Regional Average of lack of effort made by insurer at renewal. (Ernst & Young)
  13. 13. Social Business - General and Health Insurance Industry Page | 12  Minimising claim potential  Improving the Customer claim experience  Extracting information from a customers’ social platform These are currently very topical within the Insurance industry as they can directly affect the ROI of a company.  Minimising Claim Potential Joanna Moore, Chief claims officer with Mercury Insurance in the US remarks: 26 “People are updating their Facebook page and say that they just checked in at the airport. It's telling people where you are at any given moment. I think people don't realize the possible consequences of doing that. There are bad elements that are trying to find opportunities to go to peoples' homes when they're overseas. It's the awareness that people need to start thinking about.” Social Business can be utilised for online engagement with a consumer to increase awareness of ways to minimize claims. Availability of advice and information on social platforms can lead the Consumer to apply such information in situations that could result in a claim.  The Customer Claims Experience An incident which results in a claim is generally an emotional and negative experience for the Consumer. Insurance Companies are finding new ways to enable the process to be quick and trouble free and technology is playing an increasing part in this. Example: The Australian Insurance company AAMI has just launched an app that assists with managing claims: 26
  14. 14. Social Business - General and Health Insurance Industry Page | 13 27 The AAMI Claim Assist app gives advice on gathering information at an accident, uses GPS to mark the location and has camera integration to capture photos of the damage. This means that before filling out forms and registering a claim, AAMI can be made aware of the claim instantly and begin the process in a timely manner. Another example is that of Progressive (US) where a claims assistance app is integrated with both a quotation and payment facility. 28 Utilising technology to assist the claims process has enabled the Insurance industry to reduce costs and minimise workflow - a benefit to both the business and the consumer. • Extracting information from a Customers’ Social Platform A Report from Celent entitled Using ‘Social Data in Claims and Underwriting Creating a Social Risk Profile’29 has this to say about data mining: “Celent predicts that social data will be incorporated into core underwriting and claims processes over the next three years and become standard inputs into risk evaluation and settlement activities,” the report states. “This transition will not be without challenges. Key techniques that must be developed or enhanced include authentication methods, improved data extraction tools and more advanced analysis tools”30 27 28 29 30
  15. 15. Social Business - General and Health Insurance Industry Page | 14 The validity of use of this unstructured data is subject to much debate. However, it is being widely used by Insurance Companies particularly in regard to Health Insurance claims. The31 ‘Altura Insurance Social Media Report’ estimates that as many as 22%-40% of companies are using social media in claims management and it also cites difficulties encountered to include:  Lack of explicit regulatory and legal guidance  Cost effectiveness  Reliability concerns  Privacy and ethical issues They recommend that a company should use social media on a case by case basis, ensure the data gathered can be substantiated by other means and should not submit fake friend requests as a means of data gathering. This is a new area for the Insurance Industry and one that has no tangible regulatory guidelines. It is recommended that companies utilise social data mining with caution until such guidelines are in place. d. Product Development Ernst & Young comment that the traditional forms of Product Development that would have been described as:32  Conservative, limited choice range  Mass market appeal and offers  Focus group, small sample size driven are now emerging into: 31$FILE/Insurance_ Agenda_Scoial_media_article_final.pdf32
  16. 16. Social Business - General and Health Insurance Industry Page | 15  Crowd sourced ideation & co-development  Mass market forecasting and direction  Niche, more targeted offerings It is becoming increasingly apparent that the focus of influence is moving from the Insurer towards the Consumer as expression generated online can spark policy ideas and form risk profiles for niche products. iv. The Health Insurance Industry As mentioned in the Executive Summary, the potential for social Business in the Health insurance Industry is huge. Radian 633 identified that the main social business areas impacting the Health Insurance Industry are:  Customer Service  Crisis Management  Campaign Management  Loyalty/Retention  Competitor Knowledge 33
  17. 17. Social Business - General and Health Insurance Industry Page | 16 Customer Service The strategy for social Business when looking at Customer service is similar to that of the General Insurance Industry and Radian 6 advises use of the three ‘R’’s: Respect Use key phrases in engagement that empathise with the Consumer and acknowledge that the business is listening to the query/statement/complaint and taking it seriously. Reliability Reply to the engagement in a timely manner and manage expectations with the Consumer by providing clear and concise Service Level Agreements (SLA’s). Reciprocation Always acknowledge and reply to an online engagement whether in response to a positive comment, a question or a complaint. Australian Unity Health Insurance utilised all these guidelines in response to a negative comment on their Facebook Page and applied key phrasing to ensure the Consumer knew the matter was being dealt with in an appropriate manner.
  18. 18. Social Business - General and Health Insurance Industry Page | 17 34 “Thanks for the feedback and I’m sorry to hear that you have been unwell. Australian Unity takes all customer service issues seriously and the Customer Relations team is currently formally investigating your issue. You will be contacted with the outcome of our investigations once complete. Kind regards James” The one omission in Australian Unity’s reply to the Consumer above is the lack of a clear indication of the time it would take them to contact the Customer. The Customer’s perception of a reasonable time in which to complete the investigation into the query could greatly differ from the company perception and this could ultimately lead to negative C2CaB conversation about the brand. BUPA UK also responds to queries in a timely manner. It appears to be inconsistent, however, as some queries do not receive responses.35 BUPA manages contact expectations by explaining that it will be conversing on the page between certain times during weekdays; the Consumer does not expect a response at evenings and weekends, therefore. In one conversation clear details were given to the Consumer on when they should expect a call from the company, this turned a negative conversation into a positive outcome when the Customer replied36 : 34 35 36
  19. 19. Social Business - General and Health Insurance Industry Page | 18 “Thanks for call x” The ability to be able to convert a negative expression into a positive one on a public social platform is vital to the protection of a company’s brand. The Business to Consumer (B2C) conversation may appear to be one-on-one, however, as the conversation is conducted on a public platform, the reach can be extensive and the B2C conversation can escalate into a Consumer to Consumer about Business (C2CaB) conversation that the company does not have the same ability to manage effectively as they are not directly involved. Thus it is imperative for a company to manage the initial B2C conversation successfully to limit the escalation into a C2CaB one. Crisis Management The importance of having a cohesive crisis management plan is critical to a business, regardless of the Industry. In the Health Insurance Industry, the lack of a plan can lead to disaster for a brand unless a crisis is handled in an immediate and effective manner. Social Platform activity can have an almost instant impact on a brand unless they are monitored and addressed in a timely manner.
  20. 20. Social Business - General and Health Insurance Industry Page | 19 Aetna Insurance in the US were subject to a crisis in the form of cancer patient Arijit Guha who, having battled Stage 4 colon cancer, found that his lifetime limit for care of €300,000 had been used and Aetna would pay no more.37 Guha took to the social platforms to highlight his plight and in doing so, prompted negative C2CaB conversation that had the potential to severely damage the brand. Guha took to the website ‘PoopStrong’ to sell items to raise money for his treatment and received almost $20,000 in the first three days. As well as raising his own funding Guha expressed his disgust at Aetna and the Health Care system in general on Twitter. Numerous consequent negative expressions were generated by other online users who mentioned Aetna and its CEO Mark Bertolini; he conducted a conversation with Guha on Twitter that could have turned into a Public Relations catastrophe. Examples of some of the comments: @Aetna has now denied $118k in claims (in just 5 mos) since kicking me to the curb. Gotta preserve that $2 billion annual profit somehow. My bud @poopstrong, a PhD student w Stage 4, was shamefully kicked off his insurance, @Aetna. Btw congrats on the $10.6M CEO salary @mtbert! @mtbert You, sir, have blood on your hands. Man up & pay for @Poopstrong’s treatment, & for others like him. You don't need the $, they do 37
  21. 21. Social Business - General and Health Insurance Industry Page | 20 The outcome of the Bertolini : Guha exchange was that Bertolini agreed to pay for all Guha’s medical costs until the end of the plan year. Guha tweeted: Congrats, Twitter hordes! @Aetna just agreed to cover the full extent of my bills. Every last penny. Thanks, @mtbert, for listening. Bertolini commented: @AEMayo @Poopstrong This chapter is another step in the journey. The system is broken, and I am committed to fixing it. This outcome was, in many ways, positive. The handling of the affair, however, was unstructured, reactive and drawn out. The episode highlights the importance of having a strong and structured crisis management strategy designed to minimise the risk of negativity to the brand through online channels. In this case, the Multi Direction Expression Capability (MDEC) through social business could have had a profound negative impact on the brand. Campaign Management There are many examples of successful online Campaign Management within the Health Insurance Industry. Samples of the key areas of Campaign Management are:
  22. 22. Social Business - General and Health Insurance Industry Page | 21  To create a cost effective campaign  To set clear goals and objectives  To effectively raise brand awareness and extend online reach  To engage positively by ensuring a constructive MDEC. UK online health insurer conducted a successful Campaign that earned them a DADI award38 for the ‘Financial Services Campaign or Website’ category. Working with Umpf39 they defined their objectives as:  Drive traffic to the new website  Use social media to generate sales (particularly with the 25 – 40 year old age bracket)  Use social media to make Health Insurance appealing and accessible online. The experts created the world’s first ‘Ouch map’ which Umpf describe as40 : 38 39 40
  23. 23. Social Business - General and Health Insurance Industry Page | 22 “A fun, interactive social media experiment that would map minor injuries and see which parts of the body Brits hurt most. We proposed the Ouch Map as an interactive and social media friendly way to monitor those minor in real-time using an interactive Twitter app and a glowing skeleton. We believed the Ouch Map would also enable to achieve the primary objective of making online health insurance more interesting and accessible, whilst boosting site traffic and sales.” Creating dynamic content whilst providing a unique way to engage, certainly brought the results in for 41 “Since the Ouch Map launched and in the subsequent months, traffic to the trebled with the monthly sales average of policies doubling over the same period. What’s more, targeting the 25 – 40 year old age bracket has been achieved through the Ouch Map, with the average age of policy holders sitting within this demographic.” The campaign achieved the goals and objectives set and increased sales for the company, yet the participants engaged fully as the concept was interesting and without pressure. Another valuable outcome was the data gathered during the campaign as it provided research data and risk assessment data for the company too. Loyalty /Retention A report by Accenture, entitled ‘The 7 Things Your Health Insurance Customers Are Not Telling You’42 , stated that 26% of respondents feel no loyalty to their Health Insurance provider and 41% of respondents would not purchase additional products from their current provider. Customer Service is key to retention and this was made clear in the same report that found that only 6% of customers were willing to compromise on levels of customer service in exchange for a lower price. In fact, 44% strongly disagreed with diminishing the quality of service in exchange for reduced costs. 41 42 Not-Telling-You.pdf
  24. 24. Social Business - General and Health Insurance Industry Page | 23 As well as applying the three R’s, Respect, Reliability and Reciprocation, discussed above, it is apparent that the Health Insurance Industry should engage through social Business platforms in a manner similar to the General Insurance Market. The importance of MDEC together with the ability to engage: • in a timely manner • with an appropriate tone that befits the Company ethos • in an open and honest manner • with the right degree of transparency • with content that adds value to the Consumer. is vital to assuring Consumer retention. Figure 5- Source FN 42- Accenture Report
  25. 25. Social Business - General and Health Insurance Industry Page | 24 Competitor Knowledge and Data Mining Monitoring competition is obviously important, not alone competitive pricing and insurance plan offerings, but also extracting data for the purpose of product development and assessment of claims. Data mining on social Platforms has increased significantly with the rise in social media. Information publically available has already been used to advantage in minimising cost and assessing risk. Mike Fitzgerald, Senior Analyst with Celent’s Insurance Group explains43 “The information that is posted by individuals on multiple sites reflects their preferences, lifestyles, and habits. Postings from companies include descriptions of product offerings, services, and operations. In both cases, this social data can be used to build a real-time risk profile.” Data mining has been used to check facts on insurance proposals, assess health risk and investigate fraudulent claims. The right to privacy, ethics and legal implications of this use of social platforms by Insurance companies are all subject to debate but, as yet, no clear guidelines have been set. Typical examples of use are:  A customer claims to be a non-smoker and drinker on the proposal form yet photos tagged on Facebook show them smoking and drinking.  A potential customer uses ‘Foursquare’ to geo-tag themselves at venues that promote dangerous sports such as sky diving.  A claimant off work for back pain and hip trouble tweets about running a marathon or is shown in tagged photos dancing at a disco. Most Insurance companies would debate that anything made public on the internet is accessible information and can be used accordingly. Access to Consumers information can also depend on the privacy restrictions they place on their accounts. 43
  26. 26. Social Business - General and Health Insurance Industry Page | 25 v. Engagement Case Study – General Insurance From a social business perspective, Multi-Directional Expression Capability (MDEC) is the ability of a company to embrace online engagement with Consumers and manage the engagement in a way that enables increased profitability for that company. Social Media platforms enable this open and transparent discussion. The primary approach a company should adopt is to make it simple for a Consumer to engage with them online and, at the very least, provide quick and easy access to their social media sites from their own website. A sample of Insurance companies from Australia, Ireland, UK and US was examined to determine if this was the case. (Figures correct up to 13th August 2012) Australia Company Facebook Likes Number of Followers Other Info QBEInsurance No link on website No link on website No link on website No link on website GIOInsurance No link on website No link on website No link on website No link on website RACV No link on website Link on website 1,766 No link on website No link on website SMlinks provided to share content. AAMI Link on website 46,287 likes 1023 talking No link on website No link on website No link on website RACQ Link on website no page found Link on website 1,706 No link on website No link on website FB link clicks to my own account. Searched for Company and no page found. SunCorp No link on website No link on website No link on website No link on website One Path No link on website No link on website No link on website No link on website NRMA No link on website No link on website No link on website No link on website
  27. 27. Social Business - General and Health Insurance Industry Page | 26 The results show that only 37.5% of the Insurers sampled have a link to a social media Platform on their website. Facebook:  AAMI promote their FB page from their website and have a large following of 46,287. They engage frequently with the posting community of (currently) 1023  RACQ provided a link to FB; however, clicking on the links takes one to own account. A search on FB for the Company did not reveal an active page or group.  RACV provided a ‘share this’ link to FB as a means of promotion rather than engagement. Twitter:  Only two of the Insurers sampled provided a link to their Twitter account namely RACV and RACQ. Ireland: Company Facebook Likes Number of Followers Subscribers & Views Other Info Axa Ireland Linkon website 428 likes 24 talking Linkon website 1,477 No link on website No link on website Aviva Ireland No link on website No link on website No link on website No link on website Allianz Ireland Linkon website 1,468 likes 11 talking Linkon website 411 Linkon website 10 subs 12,119 views No link on website Blogon website Nononsense Linkon website 11,102 likes 3 talking No link on website Linkon website 92 subs 153,164 views No link on website WP blogon website Aon Insure No link on website No link on website No link on website No link on website F.B.D. No link on website Linkon website 3,153 Linkon website 6 subs 3090 views Linkon website 319 followers Option to engage via Skype Liberty Insurance No link on website No link on website No link on website No link on website No link on website No link on website No link on website No link on website
  28. 28. Social Business - General and Health Insurance Industry Page | 27 The results show that 50% of the Insurers sampled have a link to a social media platform on their website. Facebook:  FBD has embraced social media through Twitter and YouTube and even offers the Consumer an opportunity to communicate with the company via Skype. It appears to have deliberately chosen not to engage via Facebook. On investigation this could be down to the content in the tweet shown below. FBD Insurance@fbd_ie Facebook doubles audience Year-on-Year; but if you think that's good, how about Twitter? 800+% increase!  Reply  Retweet  Favorite 8:56 AM - 26 Feb 10 via TweetDeck · Embed this Tweet  Axa Ireland updates their Facebook page regularly. They personalise it with the name which elicits positive consumer response. They respond to negative queries and follow up on queries in a timely manner.  Whilst Axa can be commended for the management of their Facebook page, it appears that pages, set up for local offices, have never been actioned. A clear strategy is needed to assess whether to keep these pages and manage them effectively or to delete them and concentrate on the main Axa Ireland page.  Allianz Ireland promotes their Facebook page from their website and responds and engages in a timely manner.  has the largest Irish following on Facebook. They respond to queries in an open and timely manner; however they do not consistently update their content.
  29. 29. Social Business - General and Health Insurance Industry Page | 28 Twitter:  Axa Ireland regularly updates and retweets on their Twitter page  Allianz Ireland update and engage consistently on their Twitter Account  FBD update and engage consistently on their Twitter Account UK The results show that only 37.5% of the Insurers sampled have a link to a social media platform on their website. Facebook:  Aviva UK update and engage with queries on a consistent basis. They also personalise with a name and provide an option to discuss a query away from page.  Churchill converses in the character of their mascot - the nodding dog. This generates light hearted engagement with the Consumer. Company Facebook Likes Number of Followers Subscriber s & Views Other Info Axa U.K. No link on website No link on website No link on website No link on website Aviva U.K. Link on website 32,551 likes 197 talking Link on website 767 Link on website 542 subs 171,257 views No link on website G+Link on website Direct Line No link on website No link on website No link on website No link on website video on website Churchill Link on website 34,959 likes 897 talking Link on website 312 Link on website 146 subs 844,553 views No link on website WP blog on website Admiral No link on website No link on website No link on website No link on website video on website Tesco U.K. No link on website No link on website No link on website No link on website Links to share content provided LV= Link on website 1,414 likes 16 talking Link on website 2,159 Link on website 85 subs 781,934 views No link on website community forum link on website AA No link on website No link on website No link on website No link on website
  30. 30. Social Business - General and Health Insurance Industry Page | 29  LV= also manage their page effectively with timely engagement. They manage Consumer expectation by declaring weekly that they will not respond at weekends. Twitter:  Aviva UK post tweets and engage consistently. They also personalise their tweets and post avatars of the employees the Consumer is engaging with.  Churchill has set up a Twitter page yet has not actioned the account despite having over 300 followers already.  LV= post tweets and engage consistently on their Twitter page. US Company (U.S.) Facebook Likes Number of Followers Subscribers (subs)& Views Other Info Statefarm Link on website 265,659 likes 2,104 talking Link on website 24,968 Link on website 6,623 subs over 21mm views Link on website 44,637 followers Flickr link on website Allstate Link on website 79,485 likes 845 talking Link on website 28,549 Link on website 8,314 subs over 25mm views Link on website 38,759 followers Google +link on website Geico Link on website 265,004 likes 2,446 talking Link on website 9,614 Link on website 17,104 subs over 46mm views No link on website Have a Flickr account but not visible on website Progressive Link on website 48,278 likes 676 talking Link on website 13,890 Link on website 3,150 subs over 12mm views No link on website Have a Flickr account but not visible on website Nationwide Link on website 24,660 likes 10,287 talking Link on website 15,025 Link on website 460 subs over 2.5mm views No link on website Google + and Flickr link on website GMAC No link on website No link on website No link on website No link on website esurance Link on website 75,303 likes 5,644 talking Link on website 5,549 Link on website 340 subs over 592,000 views No link on website Now owned by Allstate Google +link on website
  31. 31. Social Business - General and Health Insurance Industry Page | 30 The results show that 86% of the Insurers sampled have a link to a social Media Platform on their website. Facebook:  Statefarm does engage and respond on its Facebook page however it can be inconsistent and the replies are generic. The FB link from the website has over 256k likes; however, a search revealed a page entitled ‘Statefarm Nation’ with over 1.4mm likes, managed by the same employee.  Allstate posts consistently and also engages with customers. The responses are not personalised; however, the majority of queries are dealt with.  Geico is generally consistent in its engagement with the consumer. However, it is apparent from a few of the posts that SLAs are either not in place for social business or, if they are, they are not being adhered to. Geico also has a separate page for its mascot with a similar number of likes to their main page.  Progressive are consistently active on their Facebook account. They also have a page for their mascot ‘Flo the Progressive Girl’, which is regularly managed.  Nationwide manage their Facebook account effectively, their replies are generic yet they respond in an open and honest manner.  Esurance (now owned by Allstate) effectively engage on their page in a timely manner. Twitter:  Statefarm regularly post updates on Twitter  Allstate regularly post updates on Twitter. They also have a service account (link not on website) named @allstatecares  Geico regularly posts updates on Twitter. They also have a separate service account. (link not on website)  Progressive introduce their Twitter team on their page and regularly engage.
  32. 32. Social Business - General and Health Insurance Industry Page | 31  Nationwide regularly post updates on Twitter.  Esurance regularly post updates on Twitter. Engagement Case Study – Health Insurance (Figures correct up to 7th Sept 2012) Australia The information shows that 100% of the companies detailed in the table have a link to their Facebook account from their main website page. Bupa Australia invites the Consumer to connect with them on Facebook, Twitter, YouTube and LinkedIn. The Facebook page is well managed in a timely manner and is personalised with the employee’s name utilised in the comments. The same employee manages the Twitter page regularly and has instigated a weekly chat under the hashtag #healthychat. Medibank update regularly on Facebook and invite engagement by conducting questions and polls. It is managed by different employees who take ownership of the expression by giving their name and addressing a query in a timely manner. The twitter account is updated regularly and is also used as a recruitment tool. Company FacebookLikes Number of Followers Subscribers & Views Other Info BupaAustralia Linkon Website 8,465 likes 304 talking Linkon Website 1,814 Linkon Website 38 subs 60,957 views Linkon Website 1444 followers Medibank Linkon Website 988 likes 87 talking Linkon Website 555 No link on website No link on website Australian Unity Linkon Website 44 likes 8 talking No link on website Linkon Website 8 subs 121,374 views No link on website Twitter Account but not linked to Website NIB Australia Linkon Website Clicks to own account Linkon Website 714 Linkon Website 62 subs 59,679 views No link on website HCF Australia Linkon Website 2,544 likes 89 talking No link on website No link on website No link on website
  33. 33. Social Business - General and Health Insurance Industry Page | 32 Australian Unity promotes their Facebook and YouTube accounts from their website. They have a Twitter account which is not linked to the website and is not utilised as an engagement tool with only 97 Tweets (as at 07/09/12) since May 2011. NIB has Facebook, Twitter and YouTube links on their website. The Facebook link, when clicked, does not direct to the Company page, it clicks through to the Consumer Account. A search on Facebook could not find a Facebook page for NIB. HCF concentrate on Facebook, providing a link on the website to a page that is managed on a timely basis with quality content. Ireland Out of the three companies examined in Ireland, only one has provided a link to a Facebook account. Aviva Ireland has buttons on their website for Facebook and Twitter, however these links are for the Consumer to share the Aviva page on their own account rather than access their social Platforms. Laya Healthcare has a link to Facebook on the website. The Facebook account is regularly maintained. VHI displays no links to social platforms and a search of Facebook did not reveal an active account. Company Facebook Likes Number of Followers Subscribers & Views Other Info Aviva Healthcare No link on website No link on website No link on website No link on website Laya Healthcare Link on Website 931 likes 74 talking No link on website No link on website No link on website VHI No link on website No link on website 8 subs 121,374 views
  34. 34. Social Business - General and Health Insurance Industry Page | 33 UK Three out of the five companies examined in the U.K. provided links to social Platforms on their Company websites. In contrast to Bupa Australia, who has links to four Social Platforms on their website, Bupa UK do not provide any links. This may indicate lack of a coherent Social Business Strategy on a companywide level. Axa in the UK provide links to Facebook, Twitter and YouTube on their website. Both Facebook and Twitter are actively managed on a timely basis. Simply Health UK provide links to Facebook, Twitter, YouTube and LinkedIn and also display a link to a Flickr Account and Google +. Pru Health provides links to Facebook and Twitter on their website which are both regularly updated with relevant content. April UK provide no links to a social platform from their website. Company Facebook Likes Number of Followers Subscribers & Views Other Info BupaU.K. No link on website No link on website No link on website No link on website AxaPPP Link on Website 2,939 likes 81 talking Link on Website 4,068 Link on Website 65 subs 72,603 views No link on website Simply Health U.K. Link on Website 15,460 likes 43 talking Link on Website 3,499 Link on Website 19 subs 221,246 views Link on Website 910 followers Flickr and G+ buttons on website Pru Health Link on Website 385 likes 16 talking Link on Website 921 No link on website No link on website April U.K. No link on website No link on website No link on website No link on website
  35. 35. Social Business - General and Health Insurance Industry Page | 34 US All the US companies examined, apart from Aetna, provided links from their company website to relevant social Platforms. Humana provides a link to Google + as well as Facebook, Twitter and YouTube. The accounts are regularly updated with relevant content in an engaging manner. Cigna utilises the majority of social Platforms through links on their website with the addition of a Podcast and a Daily Features link. The Twitter account is personalised with the name of the Public Relations Officer and all other links and other useful contact points are displayed on their Twitter wallpaper. WellPoint has links to Twitter and YouTube on their site whilst United Health Care only provides a link to the company Twitter account. Company Facebook Likes Number of Followers Subscribers & Views Other Info Humana Link on Website 14,166 likes 1,411 talking Link on Website 2,696 Link on Website 155 subs 52,798 views No link on website G+link on website Cigna Link on Website 3,025 likes 87 talking Link on Website 5,109 Link on Website 121 subs 100,925 views Link on Website 12,570 followers Podcast and daily Features link on website Aetna No link on website No link on website No link on website No link on website Wellpoint No link on website 385 likes 16 talking Link on Website 98 Link on Website 13 subs 4,116 views No link on website United Health Care No link on website Link on Website 1,380 No link on website No link on website
  36. 36. Social Business - General and Health Insurance Industry Page | 35 vi. Conclusion The general Consumer perception of Insurance companies is that of being traditional in their methods and autocratic in their outlook. Operating in a heavily-regulated industry and with increased Industry competition, Insurance companies need to seek innovative and effective new means to acquire, engage and retain the Consumer. The emerging online platforms have to be fully embraced by them and a clearly defined strategy of how to engage online has to be implemented and maintained. This strategy is necessary as Consumers are migrating to the online space for immediate information about these companies and they obtain it, often not from the company itself, but from the online Community. Consumer to Consumer about Business (C2CaB) conversations are now the norm; if a company does not provide a Consumer with an online channel with which to engage, the Consumer will listen to the advice of an online peer or find a company that will engage online. The Industry needs to embrace the social business model by:  Listening to online conversation  Reciprocating to online conversation in a respectful manner  Providing innovating and dynamic ways to attract and engage The potential to innovate is great, perhaps especially in the Health Insurance sector. Health Groups are forming on a global level as the Internet removes the borders of communication and people seek support and advice from peers with similar experiences. There is now a great opportunity for Health Insurance companies to utilise their expertise to provide the Consumer with advice and support from a qualified source, rather than them having to rely on anecdotal evidence from unqualified peers. The social business model needs to be carefully integrated with market factors that influence a Consumer, such as price and product. Price is not the key influencer, however, as only 6% of Consumers said they would change insurance policy due to price alone.44 In the Social Business 44 Not-Telling-You.pdf
  37. 37. Social Business - General and Health Insurance Industry Page | 36 world, the key influencer is access to real time information, both factual and anecdotal, in order to make informed choices. The scalability of the online social platforms offers huge potential to increase market share. It also brings with it the potential to assess public information online and utilise this information for product development and risk minimisation (claims handling) in a profitable way. Data mining is in its infancy and the Industry is exercising caution bringing this forward, mindful of ethical and regulatory/legal implications. Change is imminent, however, and the information available on the web will become a valuable future resource for all Industries. Social business is now a key component in all elements of the Insurance Value Chain. The Industry must embrace the business-support potential that exists (and is rapidly expanding) within the World Wide Web. Those who fail to do so will most surely be left behind as competitors seize the social business model opportunities available.