This document discusses how SugarCRM can help insurance companies by providing customer relationship management solutions tailored to the insurance vertical. It begins by outlining the key steps to understand an industry in order to conceptualize vertical-specific solutions. It then provides an overview of the insurance industry, how insurance companies work by developing products, pricing them, distributing them and processing claims. It also discusses the challenges insurance companies face in growing in a stagnant market with commoditized products and demanding customers. Finally, it proposes that focusing on customers through better engagement and transparency using CRM solutions like SugarCRM can help insurance companies overcome these challenges.

1. SugarCRM in Your Vertical
Insurance
Andrey Andreev
Global Technical Programs Manager

2. Vertical Solutions – The Learning
Process
• Understand the industry structure and
vocabulary
• Understand the industry dynamics
• Understand the industry challenges
• Understand the industry processes
• Conceptualize and communicate the solution

3. Our Case – The Insurance Vertical
• What is an insurance company?
• How does it work?
• What is going on in the marketplace?
• What are the key challenges on the way of
success?
• How do we remove them with Sugar?

4. What is an insurance company?
• A financial services provider, that aggregates
similar but separate risks across a large
number of individuals, and distributes the risk
exposure using sophisticated mathematics
• Charges premiums to collect the exposure
share plus a margin
• Invests the money collected
• Indemnifies for claimed damages covered by a
policy

5. How does it work?
• Develop products
– Life
– Car
– Property and Casualty
– Liability
– Health
– Disability
– …
• Price them exactly
• Distribute
• Process claims & complaints

6. How does it work – Products &
Distribution

7. Products
• Siloed – carriers may be separated by law
• Complex – seriously complex
• Isolated – different processes, customers
and channels

8. Distribution Channels
• Sales channels
– Direct (e.g. online, over-the-phone)
– Captive agents (also called tied, exclusive, etc.)
– Independent agents/brokers
– Affinity-based (e.g. car dealerships, bancassurance)
• Other players
– Insurance pools/syndicates
– Comparison portals
• Common agency specifics – information hiding,
regulation

9. The Insurance Dynamic (roadblocks
included)
• Push for growth in a stagnant market
– Even shrinking markets
• Commoditized product, pressure on margins
– Save 15% or more by switching to…
• Active, demanding, empowered customers
– Talking to some of the most conservative companies
out there
• Lack of customer trust, loyalty
– Average person has 5.2 policies, avg. carrier holds
less than two of those

10. Tackling those roadblocks
• Find new markets?
– Hard, but possible
• Decommoditize products? Price them better?
– Not really possible
• Better engage active (existing) customers?
– Good idea, sounds sensible enough!
• Treat customers with more transparency, service
them better?
– Why not?
• So, then, it is the customer we need to focus
on

11. How might that work for X?

12. The strategic dilemma
• According to a study by the IBM Institute for Business
Value, 90% of all insurance CEOs picked getting closer
to the customer as their most important strategic initiative
in the next five years.
• However:
– Insurances might never even talk directly to a
customer
– When it happens, information is fragmented, due to
the multi-channel, multi-equipment communication
– Agency complexity
– Information systems and processes revolve around
products, rather than customers

13. CRM is the solution! Some complications
• Agencies more often than not independent
– Info does not usually flow upstream
– Competitors working in the same system
– It’s not just attitude, it’s the law
• The data lives in ancient mission critical systems
– And you cannot touch it
• Complex “customer” relationship
– Insurance owner, insured person, indemnitee
• People don’t really talk to insurances that often
– At least not when they are in a good mood

14. MOTs? What MOTs?

15. Let’s see the demo
• Germany based
• Founded 1820
• Active in every insurance class
• 3.5 million customers
• Revenue $5.2 billion
• System running out of IBM SCE in
Ehningen