PIMA Consumer Insights 2019: Notes, Observations, and Attendee Comments on Top Challenges for the Industry

Improving the insurance ecosystem

PIMA Consumer Insights 2019: Notes, Observations, and Attendee Comments on Top Challenges for the Industry

After being away for three years, it was good to be back at PIMA - a group I networked with from 2005-2016, including a stint on the Board and facilitating four conferences. Much has changed. Much is the same. It’s a good group of people.

Opening keynote on “Curiosity”

Terrific! by Diana Kander

I ordered the book, “How The Mighty Fall.”

Best takeaway:

https://www.jimcollins.com/concepts/five-stages-of-decline.html

5 Stages of Decline - 

Stage 1: Hubris born of success

Stage 2: Undisciplined pursuit of more

Stage 3: Denial of risk and peril

The Cliff

Stage 4: Grasping for salvation

Stage 5: Capitulation to irrelevance or death

I personally related to this talk as I thought about all I have learned about Blockchain, combined with past experiences in e-Commerce and Social Technologies. There are so many companies who did not cross the chasm. They either fell in, or they sold out just before they fell in. Btw, if you haven’t picked up your copy yet, be sure to read “Life After Google” by George Archer, as recommended by longtime PIMA veteran and InsurTech guru, Bill Tyson

4 Big Questions on #Curiosity:

#1 How do you find your blind spot?

#2 How do you increase the quality of your idea?

#3 How will you know it's not working?

#4 Who will hold you accountable?

Diana Kandor

Leading through Change and Racing to Relevance

Takeaways from Barb Baumann’s talk on Relevance. Barb is VP at Securian Financial, an outstanding leader, and a highly regarded industry veteran – and all-around good person. 

Finding #DigitalTransformation

Existing In-house Solutions (they weren't getting the outcome, use digital customer journeys)

Investing in #InsurTech Partners (via Accelerators, VC's)

Innovate (Agility, workshops, MVP processes, #Innovation Lab)

Best time to change? When things are great, not in crisis. Enabling Transformation: 3-legged stool - Strategy (how you create value), Culture (align ways of working with success), Operating Model (how you run your business)

Effective cultural evolution must permeate at all levels.

Perhaps most important strategic lesson: Research in finding and understanding the target customer. Who is this person? What do they like? How do we talk to them? #2 Branding - yes we needed to do more.

Partnering looks like working together on an insurance accelerator ($100k donations), even sharing office space with @Allianz and @Securian There is no shortage of companies and educational institutions out there looking for resources.

Barb quite adroitly shared the stage with not one but two of her team.

Elizabeth Johnson, Director, Client & Business Development: Guiding Principle: Design Thinking Approach - Existing and non-existing clients developed a solution called Aimee. Benefit Scout used MVP and small teams approach to design the product. These have impacted cultural change as well.

John Underwood, National Sales VP: Two of the top levers used in staying relevant: Entering into adjacent markets and investing in digital capabilities.

Big Kudo’s to Barb and her team, on several levels, if I may say so.

Attendee Comments on Top Challenges for the Industry

Note that these comments were shared by a few PIMA members with whom I have built a relationship with. These are listed anonymously for the sake of not having to jump through compliance hoops. Thanks to those who shared.

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“The two biggest challenges are growth and differentiation. Many of our groups are exploring adjacent markets to leverage their existing capabilities as the traditional association market has had difficulties recruiting and retaining members, particularly younger ones. The second big issue is differentiation and our members adapting to changing consumer demands. As you know, the insurance industry tends to move at a glacial pace…” - Agency

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“The primary challenge that many PIMA members are focusing on is: What to do to take advantage of, or at least avoid business disruption by, InsurTech start-ups who may become significant competitors.” – Agency

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“The biggest problem facing the PIMA ecosystem is growth, which is impacted by the proliferation of entrants into most markets and channels … that whole InsurTech thing … most of whom have unsustainable business models, but for the time being they’re going to cause a lot of turbulence.” - Agency

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“Other industry groups are spending money on lobbying and marketing to protect the industry. PIMA should do that as well.” - Agency

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“… multiple claims partners processing on separate systems. Can blockchain help with that?” - Carrier

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“Keeping up with Legal & Regulatory changes in 50 states and the NAIC.” - Carrier

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“Commoditized product and differentiation.

Engagement & loyalty.

Accountability in the relationship.

Education – driving engagement.

Relevance.

But our core financial metrics are improving.” - Agency

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“Legal & Regulatory relative to group insurance, Employer Groups v. Affinity Groups” - Carrier

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“The pace of change...both with products and business partnerships...brokers are coming and going much faster, and the key people in the business are constantly shifting seats in a game of musical chairs.” – Carrier

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“Transcending and integrating business models.

Bundling products on Association sites.

Integrating data from Association, Carrier, Broker, Marketing Partner.

Big jump for people – needs licensing by the Association, IT integration, risk-sharing (e.g. Tesla)

Investing in the future.” – Carrier

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Meanwhile, on my end, work progresses on Distributed Ledger Technology (DLT), aka Blockchain for insurance. Yes, there is much happening worldwide in DLT for insurance. 

I. A workshop similar in format and style to the highly successful Social Tech Bootcamp from a few years ago is in development. It’s called the Blockchain Bootcamp for Insurance Executives. It will answer the foundational questions about DLT in play at the senior level at the moment. 

  • “What is blockchain, in plain language?”
  • “Why should I care? How will it impact our business?”
  • “What are other insurance companies doing with blockchain?”
  • “Who are the players? How long do things take? What is the budget?”
  • “What should we be thinking about for the future?” 

II. Relative to PIMA (and other ecosystem applications), I'm also hosting an informal demo of the Bermuda Risk Exchange which seems like it has application to the PIMA ecosystem, with modifications. The BRE business model of connecting multiple stakeholders in an ecosystem, sharing data, and reducing friction in the ecosystem seems to have relevance to PIMA. My idea is a PIMA Risk Exchange, a collaborative DLT environment that benefits the ecosystem and which might in fact be just the thing to cure, or at least mitigate, many of the afore-listed challenges. It's just an idea at this point. Perhaps at this early stage, by getting a few more experienced eyes on the technology, and curating the ensuing questions and comments, I might be able to begin the research to develop a business case that might eventually become a specific and meaningful response to InsurTech, AI, IoT, ML, and DLT within the Association, Affinity, and Employer Group sponsored insurance business. Again, just an idea at this point.

Comments welcome.

Remember - “Life After Google” by George Archer. (Amazon)

 

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