E:Insurance:Service In A Virtual World1Welcome to Las Vegas!
Steven M. Callahan, CMC©Practice DirectorThe Nolan Companywww.renolan.comsteve_callahan@renolan.com@StevenMCallahanwww.lin...
Automating insurance processes driven by- Rapidly advancing technology- Accelerated consumer adoptionIntegrated service ex...
PC Claims SeverityIndustry Faces Challenging Times4InvestmentsRegulationMarket ExitsTechnological AdvancesCompetitionLife ...
Demands on Service AmplifiedMore Diverse ConsumersSurge in New Service MediumsFive Generations of Consumers, Large New Wav...
6And Diversity Drives Expectations01020304050607080MillionsGI Swing Boomer Gen X Gen YHigh TechLow TechIncreasing Customer...
Service OperationsCompetitive DifferentiationPutting the Pressure OnNew↑ & Old↓Technology7ExpandingServiceMethods
With Less Room for Error8Key sources of service frustration and probability of switching:Best way to prevent switching?• F...
“… a modest increase incustomer experience willincrease customer loyaltyand boost revenues byapproximately $298 millionfor...
Strong Service Delivers Revenue10Strong CustomerExperience Management =Improved RevenueRed = Lost Revenue / Customer Turno...
And Companies Are ActingExpanding Accessibility 100%Accelerating Service Delivery 96%Increasing Hours and Days of Service ...
12Evolving the Service Delivery ModelOne Size Fits All§ Same service for all segments§ Over investin some, underinvest in ...
Based on Differentiated CustomersPredictiveAnalysisandModelingLow Medium HighPropensity to ConvertHigh value,Lowconversion...
At Acquisition and RetentionMatch effort to risk/value• Target high effortson high value /high risk• High value / lowrisk ...
Using Life time ValueTime of PurchaseDemographics -Loses predictivevalue over timeas relevance issuperseded byinforce beha...
16Leveraging Technology to DeliverFrom:To:PhonePaperEmailTextBYODWebService Delivery ProcessSelf-ServiceResolutionChat Vid...
In Claims TooFNOL EvaluateClaimCloseClaimNegotiate /Initiate ServicesPredict durationForecastloss reservesOptimize fasttra...
Top Targets in Play§ Baseline requirement: Is Workflow in place?§ Acquisition:– Sales support Expanding use of mobile devi...
Capability Maturity ApproachIdentifyCategorizeRankRateEvaluatePrioritizeInitiateIntegrate19
20Common Issues and Challenges§ Piecemeal approach – missing integrated solution– May be multi-vendor, but still must inte...
21E-Insurance at AXA-EquitableExpense ManagementE-InsuranceStrategies
22Background - PolicyholderE-InsuranceStrategies§ Life and Annuity carrier§ Customer Snapshot: ~2.9M clients, $138B of in-...
23Policyholder• Build a client experience that is efficient and gratifying• Provide awareness of digital tools through eff...
24Policyholder• Build a client experience that is efficient and gratifying• Provide awareness of digital tools through eff...
25Policyholder• Build a client experience that is efficient and gratifying• Provide awareness of digital tools through eff...
26Policyholder• Build a client experience that is efficient and gratifying• Provide awareness of digital tools through eff...
27Policyholder• Build a client experience that is efficient and gratifying• Provide awareness of digital tools through eff...
28Policyholder• Build a client experience that is efficient and gratifying• Provide awareness of digital tools through eff...
29Policyholder• Build a client experience that is efficient and gratifying• Provide awareness of digital tools through eff...
30Background – AdvisorE-InsuranceStrategies§ 50% of Variable Annuity business from Retail Sales Force (AXAAdvisors)§ 100% ...
31Advisor• Deliver a more efficient way for our Salesforce to sell our products• Implement an aggressive adoption plan to ...
32Advisor• Deliver a more efficient way for our Salesforce to sell our products• Implement an aggressive adoption plan to ...
33Advisor• Deliver a more efficient way for our Salesforce to sell our products• Implement an aggressive adoption plan to ...
34eApp in Action!https://www.dropbox.com/s/pt61i61h4t4i7gx/Jim%20eApp%20video_11-06-Video%20Sharing%2C%20smallest%20file.m...
35Advisor• Deliver a more efficient way for our Salesforce to sell our products• Implement an aggressive adoption plan to ...
36Advisor• Deliver a more efficient way for our Salesforce to sell our products• Implement an aggressive adoption plan to ...
37Background – Back OfficeE-InsuranceStrategies§ 2011: AXA Equitable engaged Nolan to help streamline DocumentManagement C...
38Back Office• Streamline and standardize document management process and bestpractice for consistent client experience• A...
39Back Office• Streamline and standardize document management process and bestpractice for consistent client experience• A...
40Back Office• Streamline and standardize document management process and bestpractice for consistent client experience• A...
41Back Office• Streamline and standardize document management process and bestpractice for consistent client experience• A...
42Back Office• Streamline and standardize document management process and bestpractice for consistent client experience• A...
43Back Office• Streamline and standardize document management process and bestpractice for consistent client experience• A...
44Digital Strategy at AXA EquitableExpense ManagementCustomer CentricityDigitalSolutionsPolicyholderAdvisorBack Office
Questions?Thank You For Your Time!Have a safe trip home.45Steven M. Callahan, CMC©The Nolan Companywww.renolan.comsteve_ca...
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201305 - ACORD LOMA Conference: e-Insurance

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Presentation at 2013 ACORD LOMA Conference on moving insurance to a world of digital congress, from electronic apps to e-signatures, straight through processing, and image management. Presented in partnership with AXA Equitable's Nick Intrieri

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201305 - ACORD LOMA Conference: e-Insurance

  1. 1. E:Insurance:Service In A Virtual World1Welcome to Las Vegas!
  2. 2. Steven M. Callahan, CMC©Practice DirectorThe Nolan Companywww.renolan.comsteve_callahan@renolan.com@StevenMCallahanwww.linkedin.com/in/stevencallahanNick Intrieri, PMPDirector – Strategic SolutionsAXA Equitable | Retirement Service Solutionswww.axa-equitable.comNicholas.intrieri@axa-equitable.com2Session Presenters
  3. 3. Automating insurance processes driven by- Rapidly advancing technology- Accelerated consumer adoptionIntegrated service experience solutions drive‐ Increased profitability‐ Improved customer satisfaction‐ Improved retentionSession Objectives:‐ Determining opportunities for achieving integrated service‐ Identifying key service delivery technologies and how they work together‐ Assessing service delivery deficiencies3Session Overview
  4. 4. PC Claims SeverityIndustry Faces Challenging Times4InvestmentsRegulationMarket ExitsTechnological AdvancesCompetitionLife Insurance Ownership
  5. 5. Demands on Service AmplifiedMore Diverse ConsumersSurge in New Service MediumsFive Generations of Consumers, Large New Wave Coming(% of Total Population)Greater Ethnic DiversityThe Digital Generations- powerful consumers5
  6. 6. 6And Diversity Drives Expectations01020304050607080MillionsGI Swing Boomer Gen X Gen YHigh TechLow TechIncreasing Customers Demands• Immediacy / 24x7 access• Transparency• Personal service relationships• Language differences• Benchmarks within and outside the industryAgent > Mail > Phone > Fax > Email > Website > Chat > Social (FB, Twitter)
  7. 7. Service OperationsCompetitive DifferentiationPutting the Pressure OnNew↑ & Old↓Technology7ExpandingServiceMethods
  8. 8. With Less Room for Error8Key sources of service frustration and probability of switching:Best way to prevent switching?• First contact resolution 67%• Reward & recognition for doing more business 54%• Preferential treatment 44%*Accenture 2012 Global Survey62%64%65%70%71%73%77%78%0% 10% 20% 30% 40% 50% 60% 70% 80%Attempts to cross sell when calling for…Having to repeat same information over…Long hold times when calling serviceStaff unable to answer questionBusiness policies that inhibit delivering…Multiple attempts to get problem resolvedUnfriendly or impolite service staffIncorrect product or service provided
  9. 9. “… a modest increase incustomer experience willincrease customer loyaltyand boost revenues byapproximately $298 millionfor a $10 billion insuranceprovider.“Forrester Research, February 17, 2010“Nationwide Insurancefound that a 1% increasein customer retentionincreased annualpremiums by $1 million”Insurance Tech. - CRM in Global Insurance,Datamonitor, 2008.“Reducing customerattrition by 5-10% canincrease annual profits byas much as 75%, accordingto a study by the WhartonSchool.“Eight Strategies for First Rate CustomerService, Cisco Innovators, January 2008Customer is a King with Great PowerTens of thousands of positive service touchpointsa day, and yet one bad interaction…And suddenly yourcompany is at the topof the tweets list tellingthousands followedquickly by a Facebook“Unlike” Fan Page.9Before Social MediaToday’s Customer
  10. 10. Strong Service Delivers Revenue10Strong CustomerExperience Management =Improved RevenueRed = Lost Revenue / Customer TurnoverYellow= Incremental Revenue,Existing CustomersDark Blue = NewCustomer RevenueLight Blue = Net Change in RevenueAverageBest-In-Class LaggardsNet Up $273M Net Up $84M Net Down $43M
  11. 11. And Companies Are ActingExpanding Accessibility 100%Accelerating Service Delivery 96%Increasing Hours and Days of Service Availability 82%Creating Different Levels of Producer Service 82%Consolidating Similar Functions Across Divisions 75%Creating Different Levels of Customer Service 63%Aligning Operations with Customer Markets 63%Consolidation of Call Center Operations 57%Aligning Operations with Distribution Channel 57%Consolidating Physical Locations 50%RespondentsArea of Focus11
  12. 12. 12Evolving the Service Delivery ModelOne Size Fits All§ Same service for all segments§ Over investin some, underinvest in others§ One model to manage§ Differentiation created atcompany vs. segmentlevels§ Easier to match capabilitiesEvolving Model§ Segmentationof needs andvalue§ Service matched to segmentneeds§ Appropriate service investmentin each segment§ More challenging model tomanage but also …§ Harder to replicate by thecompetition
  13. 13. Based on Differentiated CustomersPredictiveAnalysisandModelingLow Medium HighPropensity to ConvertHigh value,Lowconversion,2nd PriorityHigh value,Mediumconversion,Top PriorityHigh value,Highconversion,Top priorityGood value,Lowconversion,Low PriorityGood value,Mediumconversion,2nd PriorityGood value,Highconversion,Top PriorityLow value,Lowconversion,Low PriorityLow value,Mediumconversion,Low PriorityLow value,Highconversion,2nd PriorityPotential ValueLowMediumHighPotentialFutureValue ofCustomerScoring of prospects based on conversion andvalue, marketing strategy developed to matchSurveyDataWebLogDataTextDataPurchasedDataPsycho-graphicData13
  14. 14. At Acquisition and RetentionMatch effort to risk/value• Target high effortson high value /high risk• High value / lowrisk gets mediumeffort• Low value = lowcost efforts14
  15. 15. Using Life time ValueTime of PurchaseDemographics -Loses predictivevalue over timeas relevance issuperseded byinforce behaviorsCustomer behaviorshifts focus fromcurrent to futurevaluePredictiveAnalysisCurrentValueFutureValuePost PurchaseActivity –Increases inpredictive valueover time asbehavioralpatternsdevelop15
  16. 16. 16Leveraging Technology to DeliverFrom:To:PhonePaperEmailTextBYODWebService Delivery ProcessSelf-ServiceResolutionChat VideoTransfer Dialer• Real time availability becomes key• Interactive online rules, forms and data neededNote: Social Media is a transportProcess = Requestà Process à Resolution
  17. 17. In Claims TooFNOL EvaluateClaimCloseClaimNegotiate /Initiate ServicesPredict durationForecastloss reservesOptimize fasttrack claimsPrioritize resourcesFraudulent scoringLitigationpropensityPrioritizedinvestigationFocus on organizedfraudMinimizeclaim paddingReduce false positivesIdentify salvage and subrogationopportunitiesIndicate deviations fromsimilarclaimsInitiateSettlementSIUUpdateClaimFraud Referrals Fraud ReferralsRe-estimatedurationReassess loss reservingPrioritize resourcesFraudulent rescoringReviewlitigationpropensityCross-selloptions for satisfiedcustomerCustomer retentionprogramAssignClaimFast Track Claim17
  18. 18. Top Targets in Play§ Baseline requirement: Is Workflow in place?§ Acquisition:– Sales support Expanding use of mobile devices– Electronic app Fairly straightforward, forms library– E-signature More complicated, issues addressed– Straight through processing Multiple solutions, fairly mature– Rules based underwriting Continuous advancements– E-delivery Multiple solutions, market issues§ Management– Self service web portals Moderate advances– Interactive chat Available but not used– Mobile transactions Early on curve– Social media triggers Being defined, used for engagement§ Delivery– FNOL submission Rapidly expanding– Automated Claims Review Starting up, analytics, webcams– In-process communications Fairly new, similar to management– Direct delivery of payment Mature18
  19. 19. Capability Maturity ApproachIdentifyCategorizeRankRateEvaluatePrioritizeInitiateIntegrate19
  20. 20. 20Common Issues and Challenges§ Piecemeal approach – missing integrated solution– May be multi-vendor, but still must integrate– End to end flow– Reusable solutions: e-Policy Delivery = e-Confirms = e-Statements§ Misalignment of service strategy and corporate strategy– Customers being focused on?– High impact areas?– Competitive Differentiation§ Focused on technology solution and ignore business process– Should be business led, technology enabled– Outside in view: Is it seamless? Does it flow without redundancy?§ Lack of follow through– Reusability is key to fully deriving benefits and delivering service
  21. 21. 21E-Insurance at AXA-EquitableExpense ManagementE-InsuranceStrategies
  22. 22. 22Background - PolicyholderE-InsuranceStrategies§ Life and Annuity carrier§ Customer Snapshot: ~2.9M clients, $138B of in-force assets§ Challenge: Increasing operating expenses and stagnant webutilization§ eDelivery penetration low
  23. 23. 23Policyholder• Build a client experience that is efficient and gratifying• Provide awareness of digital tools through effective marketingtechniquesSelf Service Tools§ Online Account Access: Non financial transactions, accountbalance inquires, trades§ eDelivery options: Statements, Prospectus, Annual Reports§ Win/win for client and carrier?§ In 2010: 24% Online Account Access; 5.1% eDeliveryWhy is the adoption rate so low????
  24. 24. 24Policyholder• Build a client experience that is efficient and gratifying• Provide awareness of digital tools through effective marketingtechniquesMotivation and Awareness§ Lengthy enrollment process§ Previous marketing strategy inserts and envelopes§ Client incentives unclear§ Company incentives very clear (eDelivery):$~$26M Company Wide Annual Print & Postage Spend
  25. 25. 25Policyholder• Build a client experience that is efficient and gratifying• Provide awareness of digital tools through effective marketingtechniquesSavings BreakdownWhat is the best way to increase eDelivery?Inforce ProspectusAnnual ReportSemi-Annual ReportStatements (4x)Confirms (6x)Marketing BudgetService Center Budget
  26. 26. 26Policyholder• Build a client experience that is efficient and gratifying• Provide awareness of digital tools through effective marketingtechniquesAction Plan – Provide Incentive§ Launched AXA Equitable eDelivery Sweepstakes in 2010§ Emphasized “Go Green” Theme1. Grand Prize – Hybrid Car (2011 Ford Fusion)2. 154 First and Second Place Prizes3. Contest Spanned from January – October 20104. Separate “Employee Sweepstakes” for AXA policyholders5. Goal – Increase eDelivery rate by 3%
  27. 27. 27Policyholder• Build a client experience that is efficient and gratifying• Provide awareness of digital tools through effective marketingtechniquesMarketing Strategy§ Stuffers instatements/confirms:§ Email Campaign:
  28. 28. 28Policyholder• Build a client experience that is efficient and gratifying• Provide awareness of digital tools through effective marketingtechniquesRisks & Challenges§ Compliance and Legal§ Sweepstakes Administration§ IT Implementation§ Marketing Campaign (Email)
  29. 29. 29Policyholder• Build a client experience that is efficient and gratifying• Provide awareness of digital tools through effective marketingtechniquesResultsE-Delivery grand-prize winner John Holland withVP Accumulator Field Services Jim OBoyle, VP,AXA Equitable and Larry George, FinancialProfessional, AXA Advisors. – ChattanoogaTimes§ Increased eDelivery enrollment 161% fromprior year§ Company save ~$1M annually§ Positive customer feedback§ 2012 Sweepstakes yielded additional 50%enrollment increase§ Currently at 11.5% eDelivery adoption rate
  30. 30. 30Background – AdvisorE-InsuranceStrategies§ 50% of Variable Annuity business from Retail Sales Force (AXAAdvisors)§ 100% of applications submitted via Paper§ Complex variable annuity products (SCS, Retirement Cornerstone)§ NIGO Rate for AXA Advisors >50%§ 3rd party electronic order entry (Aplifi, Ebix) 20% NIGO Rate
  31. 31. 31Advisor• Deliver a more efficient way for our Salesforce to sell our products• Implement an aggressive adoption plan to maximize return ofinvestmentClear Opportunity – Annuity eApp§ Eliminate multiple manual touch points that result in highNIGOs§ Further AXA’s strategic goals of straight through processing andbrand recognition§ Position AXA as an industry leader in technologicaladvancementeApp + eSignature = Straight Through Processing
  32. 32. 32Advisor• Deliver a more efficient way for our Salesforce to sell our products• Implement an aggressive adoption plan to maximize return ofinvestmentChallenges§ Vendor Selection Process§ Integration of eSignature within eApp and downstream systems§ Regulatory environment difficult to navigate§ Budget and timeline to implement tight§ Reaching aggressive adoption targets (50% Adoption Year End)
  33. 33. 33Advisor• Deliver a more efficient way for our Salesforce to sell our products• Implement an aggressive adoption plan to maximize return ofinvestmentSystem Design
  34. 34. 34eApp in Action!https://www.dropbox.com/s/pt61i61h4t4i7gx/Jim%20eApp%20video_11-06-Video%20Sharing%2C%20smallest%20file.movLink to video on eApp:
  35. 35. 35Advisor• Deliver a more efficient way for our Salesforce to sell our products• Implement an aggressive adoption plan to maximize return ofinvestmentRollout Plan§ Launched pilot in 3 branches Jan - March§ Multiple WebEx Training Schedules for Admins, Advisors, and BranchOperations Managers§ Comprehensive Communication Plan1. Intranet/Email/Field Bulletin2. Materials: Tutorial Video, User Manual, Quick Reference Cards§ On site training and demos with big producers throughout 2013§ Dedicated eApp support team (Phone & Email)
  36. 36. 36Advisor• Deliver a more efficient way for our Salesforce to sell our products• Implement an aggressive adoption plan to maximize return ofinvestmentResults§ Positive feedback from AXA Advisors1. iPad capability smooth and convenient2. Electronic signatures flexible and intuitive§ 5% adoption 1st month on track for 50% Year End§ NIGO Rate reduced from 53% to 2% for eApp submissions“It cut the entire process downa week. I don’t have to travel toget signatures or pay forovernighting paperwork. “-Travis Penfield (AXA Advisors)“Gamechanger”“Can abandontrunk full ofapplications”“As a new advisor and not beingquite as familiar with all of therequired forms, Annuity eAppwas a huge asset.”-Kevin Kaplan (AXAAdvisors)
  37. 37. 37Background – Back OfficeE-InsuranceStrategies§ 2011: AXA Equitable engaged Nolan to help streamline DocumentManagement Center (DMC) Operations in order to:§ Streamline DMC functions (Prep, Scan, Mail) across enterprise§ Leverage Digital Content (Email)§ Consolidation§ *Optical Character Recognition§ Construction of a Digital Mailroom: Big Opportunity
  38. 38. 38Back Office• Streamline and standardize document management process and bestpractice for consistent client experience• Automate and digitize for increased efficiencyEliminate Waste§ 2011 State Document Management:Scan VerifyOpen Sort Prep Scan Index DepositDeposit§ Proposed “Optimal” State with OCR:Open
  39. 39. 39Back Office• Streamline and standardize document management process and bestpractice for consistent client experience• Automate and digitize for increased efficiencyVendor Selection§ Key Decision Factors§ Company§ Solution/Technology§ Implementation/Integration§ Proposal/Price§ AXA Germany Solution
  40. 40. 40Back Office• Streamline and standardize document management process and bestpractice for consistent client experience• Automate and digitize for increased efficiencyInsiders Technologies - smartFIX
  41. 41. 41Back Office• Streamline and standardize document management process and bestpractice for consistent client experience• Automate and digitize for increased efficiencyProject Plan – Phased Approach§ Consolidation implemented prior to OCR§ Staggered rollout enterprise wide§ Business area ramp up at each site (New Business, Inforce, etc.)§ Project completed in 18 months
  42. 42. 42Back Office• Streamline and standardize document management process and bestpractice for consistent client experience• Automate and digitize for increased efficiencyChallenges§ Overlapping project resources§ Integration with admin systems/workflow§ Infrastructure (Fax Server)§ Optimization Ramp Up§ Change Management
  43. 43. 43Back Office• Streamline and standardize document management process and bestpractice for consistent client experience• Automate and digitize for increased efficiencyResults§ Successful Implementation On Time & Budget§ OCR Enterprise Support Team: Best Practice§ Classification Rate: 55%; Straight Through Rate: 8%§ 2013 Savings to be realized: $.75M/AnnualStill to come….§ Optimization Ramp Up Savings: $1.8M/Annual§ Classification Rate 85%; Straight Through Rate: 25%
  44. 44. 44Digital Strategy at AXA EquitableExpense ManagementCustomer CentricityDigitalSolutionsPolicyholderAdvisorBack Office
  45. 45. Questions?Thank You For Your Time!Have a safe trip home.45Steven M. Callahan, CMC©The Nolan Companywww.renolan.comsteve_callahan@renolan.comNick Intrieri, PMPAXA Equitable | Retirement Service Solutionswww.axa-equitable.comNicholas.intrieri@axa-equitable.com

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