What NOT to Do

Agent and Brokers Commentary: January 2024 

Image
Technology and human hand touching

Gordon Bell, a computer industry pioneer who developed the legendary PDP and VAX lines of minicomputers back in the 1960s and 1970s, famously said that “the most reliable part of a computer is the one you leave out.”  

I’ve taken that to heart in all sorts of ways over the more than 35 years that I’ve had the pleasure of knowing and occasionally working with Gordon. In insurance terms, his famous line convinced me quickly, for instance, about the need for triage in claims – why send an adjuster if the likely change in a claim will be so small that it won’t cover the cost of the adjuster’s efforts? 

Agents and brokers rarely have the luxury of just deciding to stop doing something. But they can at least turn over a lot of required tasks to their computer systems and “leave out” work for themselves. 

To learn more about the efficiencies that are out there to be had, I spoke with Allister Yu, senior vice president, operations, at Rhoads, which focuses on software for compliance but which has a broad perspective on the possibilities of automation. 

He said, “In terms of things that are the most ripe for automation, I would say, credentialing, credential management and the communication between agencies and carriers and various stakeholders are all areas of opportunity…. We've seen case studies where organizations… that previously had teams of 70-plus individuals managing the compliance process were able to pare those teams down to 15 to 18 professionals through automation. The remaining staff can be refocused in other parts of the organization to leverage their expertise.” 

He added, “At the carrier level, organizations… were collecting PDFs but were subject to the legibility of those hand-completed documents. Now that they collect that data in an electronic process with electronic approvals, they are often able to shorten the contracting process from two weeks down to a matter of days.” 

Like just about everyone else these days – even those who once proclaimed that agents and brokers would be disintermediated – Yu said customers will always value the human touch. 

“I personally still like to pick up the phone and call somebody,” he said. “When we're looking at sales, when we're looking at the broker, when we're looking at the insurance agent, that's still going to be a highly human aspect.” 

But he argued that “there are a lot of tasks that, in terms of back-office processing, can be automated.” 

I’m sure Gordon Bell agrees. I certainly do. 

Cheers, 

Paul 


20 ISSUES TO WATCH IN 2024

Electoral politics, especially at the state level; the economic outlook; geopolitical risks; and evolving employee benefits top the list.

THE NEXT WAVE OF INSURTECHS

The first wave taught the valuable lesson that innovation builds on traditional fundamentals rather than replacing them outright.

BALANCING AI AND THE FUTURE OF INSURANCE

To be successful in our use of AI, we must remember one thing: A machine cannot replace the need for human touch in our industry.

TOP 5 INSURTECH TRENDS TO WATCH IN 2024

Embedded insurance, customer-facing digital tools, telematics and the IoT, rich data sets and AI and ML will mark a paradigm shift.

IN 2024, CHANGE BECOMES NON-NEGOTIABLE

Here are nine predictions for 2024, based on the certainty that few of yesterday’s approaches will be successful in tomorrow’s world.

MAYBE OEMS AREN'T SUCH A THREAT TO AUTO INSURERS

Tesla's problems developing an insurance business suggest the auto behemoths may not be as threatening as once thought. 


Paul Carroll

Profile picture for user PaulCarroll

Paul Carroll

Paul Carroll is the editor-in-chief of Insurance Thought Leadership.

He is also co-author of A Brief History of a Perfect Future: Inventing the Future We Can Proudly Leave Our Kids by 2050 and Billion Dollar Lessons: What You Can Learn From the Most Inexcusable Business Failures of the Last 25 Years and the author of a best-seller on IBM, published in 1993.

Carroll spent 17 years at the Wall Street Journal as an editor and reporter; he was nominated twice for the Pulitzer Prize. He later was a finalist for a National Magazine Award.

MORE FROM THIS AUTHOR

Read More