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201305 - ACORD LOMA Conference: e-Insurance
The document outlines strategies for improving insurance services through automation and technology integration to enhance customer experience and operational efficiency. Key focuses include addressing service delivery deficiencies, leveraging digital tools for policyholder engagement, and optimizing document management processes. Successful initiatives include increasing electronic delivery adoption and reducing non-guaranteed issue rates for applications, ultimately leading to improved customer satisfaction and significant cost savings.
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201305 - ACORD LOMA Conference: e-Insurance
- 1. E:Insurance: Service In AVirtual World 1 Welcome to Las Vegas!
- 2. Steven M. Callahan,CMC© Practice Director The Nolan Company www.renolan.com steve_callahan@renolan.com @StevenMCallahan www.linkedin.com/in/stevencallahan Nick Intrieri, PMP Director – Strategic Solutions AXA Equitable | Retirement Service Solutions www.axa-equitable.com Nicholas.intrieri@axa-equitable.com 2 Session Presenters
- 3. Automating insurance processesdriven by - Rapidly advancing technology - Accelerated consumer adoption Integrated service experience solutions drive ‐ Increased profitability ‐ Improved customer satisfaction ‐ Improved retention Session Objectives: ‐ Determining opportunities for achieving integrated service ‐ Identifying key service delivery technologies and how they work together ‐ Assessing service delivery deficiencies 3 Session Overview
- 4. PC Claims Severity IndustryFaces Challenging Times 4 Investments Regulation Market Exits Technological Advances Competition Life Insurance Ownership
- 5. Demands on ServiceAmplified More Diverse Consumers Surge in New Service Mediums Five Generations of Consumers, Large New Wave Coming (% of Total Population) Greater Ethnic Diversity The Digital Generations - powerful consumers 5
- 6. 6 And Diversity DrivesExpectations 0 10 20 30 40 50 60 70 80 Millions GI Swing Boomer Gen X Gen Y High TechLow Tech Increasing Customers Demands • Immediacy / 24x7 access • Transparency • Personal service relationships • Language differences • Benchmarks within and outside the industry Agent > Mail > Phone > Fax > Email > Website > Chat > Social (FB, Twitter)
- 7. Service Operations Competitive Differentiation Puttingthe Pressure On New↑ & Old↓ Technology 7 Expanding ServiceMethods
- 8. With Less Roomfor Error 8 Key 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 Survey 62% 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 service Staff unable to answer question Business policies that inhibit delivering… Multiple attempts to get problem resolved Unfriendly or impolite service staff Incorrect product or service provided
- 9. “… a modestincrease in customer experience will increase customer loyalty and boost revenues by approximately $298 million for a $10 billion insurance provider.“ Forrester Research, February 17, 2010 “Nationwide Insurance found that a 1% increase in customer retention increased annual premiums by $1 million” Insurance Tech. - CRM in Global Insurance, Datamonitor, 2008. “Reducing customer attrition by 5-10% can increase annual profits by as much as 75%, according to a study by the Wharton School.“ Eight Strategies for First Rate Customer Service, Cisco Innovators, January 2008 Customer is a King with Great Power Tens of thousands of positive service touchpoints a day, and yet one bad interaction… And suddenly your company is at the top of the tweets list telling thousands followed quickly by a Facebook “Unlike” Fan Page. 9 Before Social Media Today’s Customer
- 10. Strong Service DeliversRevenue 10 Strong Customer Experience Management = Improved Revenue Red = Lost Revenue / Customer Turnover Yellow= Incremental Revenue,Existing Customers Dark Blue = NewCustomer Revenue Light Blue = Net Change in Revenue AverageBest-In-Class Laggards Net Up $273M Net Up $84M Net Down $43M
- 11. And Companies AreActing Expanding 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 Focus 11
- 12. 12 Evolving the ServiceDelivery Model One Size Fits All § Same service for all segments § Over investin some, under invest in others § One model to manage § Differentiation created at company vs. segmentlevels § Easier to match capabilities Evolving Model § Segmentationof needs and value § Service matched to segment needs § Appropriate service investment in each segment § More challenging model to manage but also … § Harder to replicate by the competition
- 13. Based on DifferentiatedCustomers Predictive Analysis and Modeling Low Medium High Propensity to Convert High value, Low conversion, 2nd Priority High value, Medium conversion, Top Priority High value, High conversion, Top priority Good value, Low conversion, Low Priority Good value, Medium conversion, 2nd Priority Good value, High conversion, Top Priority Low value, Low conversion, Low Priority Low value, Medium conversion, Low Priority Low value, High conversion, 2nd Priority Potential Value LowMediumHigh Potential Future Value of Customer Scoring of prospects based on conversion and value, marketing strategy developed to match Survey Data Web Log Data Text Data Purchased Data Psycho- graphic Data 13
- 14. At Acquisition andRetention Match effort to risk/value • Target high efforts on high value / high risk • High value / low risk gets medium effort • Low value = low cost efforts 14
- 15. Using Life timeValue Time of Purchase Demographics - Loses predictive value over time as relevance is superseded by inforce behaviors Customer behavior shifts focus from current to future value Predictive Analysis Current Value Future Value Post Purchase Activity – Increases in predictive value over time as behavioral patterns develop 15
- 16. 16 Leveraging Technology toDeliver From: To: Phone Paper Email Text BYOD Web Service Delivery Process Self-Service Resolution Chat Video Transfer Dialer • Real time availability becomes key • Interactive online rules, forms and data needed Note: Social Media is a transport Process = Requestà Process à Resolution
- 17. In Claims Too FNOLEvaluate Claim Close Claim Negotiate / Initiate ServicesPredict duration Forecastloss reserves Optimize fasttrack claims Prioritize resources Fraudulent scoring Litigationpropensity Prioritizedinvestigation Focus on organizedfraud Minimizeclaim padding Reduce false positives Identify salvage and subrogation opportunities Indicate deviations fromsimilar claims Initiate Settlement SIU Update Claim Fraud Referrals Fraud Referrals Re-estimateduration Reassess loss reserving Prioritize resources Fraudulent rescoring Reviewlitigationpropensity Cross-selloptions for satisfied customer Customer retentionprogram Assign Claim Fast Track Claim 17
- 18. Top Targets inPlay § 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 Mature 18
- 19.
- 20. 20 Common Issues andChallenges § 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 E-Insurance at AXA-Equitable ExpenseManagement E-Insurance Strategies
- 22. 22 Background - Policyholder E-Insurance Strategies §Life and Annuity carrier § Customer Snapshot: ~2.9M clients, $138B of in-force assets § Challenge: Increasing operating expenses and stagnant web utilization § eDelivery penetration low
- 23. 23 Policyholder • Build aclient experience that is efficient and gratifying • Provide awareness of digital tools through effective marketing techniques Self Service Tools § Online Account Access: Non financial transactions, account balance inquires, trades § eDelivery options: Statements, Prospectus, Annual Reports § Win/win for client and carrier? § In 2010: 24% Online Account Access; 5.1% eDelivery Why is the adoption rate so low????
- 24. 24 Policyholder • Build aclient experience that is efficient and gratifying • Provide awareness of digital tools through effective marketing techniques Motivation 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 Policyholder • Build aclient experience that is efficient and gratifying • Provide awareness of digital tools through effective marketing techniques Savings Breakdown What is the best way to increase eDelivery? Inforce Prospectus Annual Report Semi-Annual Report Statements (4x) Confirms (6x) Marketing Budget Service Center Budget
- 26. 26 Policyholder • Build aclient experience that is efficient and gratifying • Provide awareness of digital tools through effective marketing techniques Action Plan – Provide Incentive § Launched AXA Equitable eDelivery Sweepstakes in 2010 § Emphasized “Go Green” Theme 1. Grand Prize – Hybrid Car (2011 Ford Fusion) 2. 154 First and Second Place Prizes 3. Contest Spanned from January – October 2010 4. Separate “Employee Sweepstakes” for AXA policy holders 5. Goal – Increase eDelivery rate by 3%
- 27. 27 Policyholder • Build aclient experience that is efficient and gratifying • Provide awareness of digital tools through effective marketing techniques Marketing Strategy § Stuffers in statements/confirms: § Email Campaign:
- 28. 28 Policyholder • Build aclient experience that is efficient and gratifying • Provide awareness of digital tools through effective marketing techniques Risks & Challenges § Compliance and Legal § Sweepstakes Administration § IT Implementation § Marketing Campaign (Email)
- 29. 29 Policyholder • Build aclient experience that is efficient and gratifying • Provide awareness of digital tools through effective marketing techniques Results E-Delivery grand-prize winner John Holland with VP Accumulator Field Services Jim O'Boyle, VP, AXA Equitable and Larry George, Financial Professional, AXA Advisors. – Chattanooga Times § Increased eDelivery enrollment 161% from prior year § Company save ~$1M annually § Positive customer feedback § 2012 Sweepstakes yielded additional 50% enrollment increase § Currently at 11.5% eDelivery adoption rate
- 30. 30 Background – Advisor E-Insurance Strategies §50% of Variable Annuity business from Retail Sales Force (AXA Advisors) § 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 Advisor • Deliver amore efficient way for our Salesforce to sell our products • Implement an aggressive adoption plan to maximize return of investment Clear Opportunity – Annuity eApp § Eliminate multiple manual touch points that result in high NIGOs § Further AXA’s strategic goals of straight through processing and brand recognition § Position AXA as an industry leader in technological advancement eApp + eSignature = Straight Through Processing
- 32. 32 Advisor • Deliver amore efficient way for our Salesforce to sell our products • Implement an aggressive adoption plan to maximize return of investment Challenges § 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 Advisor • Deliver amore efficient way for our Salesforce to sell our products • Implement an aggressive adoption plan to maximize return of investment System Design
- 34.
- 35. 35 Advisor • Deliver amore efficient way for our Salesforce to sell our products • Implement an aggressive adoption plan to maximize return of investment Rollout Plan § Launched pilot in 3 branches Jan - March § Multiple WebEx Training Schedules for Admins, Advisors, and Branch Operations Managers § Comprehensive Communication Plan 1. Intranet/Email/Field Bulletin 2. 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 Advisor • Deliver amore efficient way for our Salesforce to sell our products • Implement an aggressive adoption plan to maximize return of investment Results § Positive feedback from AXA Advisors 1. iPad capability smooth and convenient 2. 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 down a week. I don’t have to travel to get signatures or pay for overnighting paperwork. “ -Travis Penfield (AXA Advisors) “Game changer” “Can abandon trunk full of applications” “As a new advisor and not being quite as familiar with all of the required forms, Annuity eApp was a huge asset.” -Kevin Kaplan (AXA Advisors)
- 37. 37 Background – BackOffice E-Insurance Strategies § 2011: AXA Equitable engaged Nolan to help streamline Document Management 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 Back Office • Streamlineand standardize document management process and best practice for consistent client experience • Automate and digitize for increased efficiency Eliminate Waste § 2011 State Document Management: Scan Verify Open Sort Prep Scan Index DepositDeposit § Proposed “Optimal” State with OCR: Open
- 39. 39 Back Office • Streamlineand standardize document management process and best practice for consistent client experience • Automate and digitize for increased efficiency Vendor Selection § Key Decision Factors § Company § Solution/Technology § Implementation/Integration § Proposal/Price § AXA Germany Solution
- 40. 40 Back Office • Streamlineand standardize document management process and best practice for consistent client experience • Automate and digitize for increased efficiency Insiders Technologies - smartFIX
- 41. 41 Back Office • Streamlineand standardize document management process and best practice for consistent client experience • Automate and digitize for increased efficiency Project 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 Back Office • Streamlineand standardize document management process and best practice for consistent client experience • Automate and digitize for increased efficiency Challenges § Overlapping project resources § Integration with admin systems/workflow § Infrastructure (Fax Server) § Optimization Ramp Up § Change Management
- 43. 43 Back Office • Streamlineand standardize document management process and best practice for consistent client experience • Automate and digitize for increased efficiency Results § Successful Implementation On Time & Budget § OCR Enterprise Support Team: Best Practice § Classification Rate: 55%; Straight Through Rate: 8% § 2013 Savings to be realized: $.75M/Annual Still to come…. § Optimization Ramp Up Savings: $1.8M/Annual § Classification Rate 85%; Straight Through Rate: 25%
- 44. 44 Digital Strategy atAXA Equitable Expense Management Customer Centricity Digital Solutions Policyholder Advisor Back Office
- 45. Questions? Thank You ForYour Time! Have a safe trip home. 45 Steven M. Callahan, CMC© The Nolan Company www.renolan.com steve_callahan@renolan.com Nick Intrieri, PMP AXA Equitable | Retirement Service Solutions www.axa-equitable.com Nicholas.intrieri@axa-equitable.com