Have you ever experienced your company's various processes? This would be a great exercise for many executives.
Step 1 — Decide on the specific problems you are trying to solve within your organization.
Carriers have a unique opportunity during this time of insurtechs. There are many great insurtechs out there that are solving problems for the industry. However, for a carrier to take true advantage of this opportunity, it first needs to identify specific problems within the organization that need to be solved. It doesn’t make sense to find insurtechs in the marketplace and then look to see how they fit within your organization. Both the insurtech's and carrier's time will be better managed if you first decide on specific challenges your organization is looking to attack. For example, have you decided that your organization needs to improve the customer experience during the claims process? Then seek out an insurtech that solves that specific problem. Don’t look to speak with insurtech companies just because insurtech is the hot topic right now. Match the insurtech companies to your issues, and both companies will benefit. Working with insurtechs will take a shift in the thinking and paradigms within the organization.
Step 2 — Have a separate vendor procurement process for insurtechs.
You must put yourself in the insurtech’s shoes for a moment. Have you ever gone through your company’s vendor procurement process? Is it a nine-month process for even the most sophisticated companies with unlimited resources and attorneys on staff? Here is what I can tell you as a founder and CEO of an insurtech company, Benekiva. We simply cannot spend the time or the resources to go through an extensive vendor procurement process. Don’t get me wrong. I am not suggesting that you skip the due diligence process on these insurtech companies. I am suggesting that you need to have a separate procurement process that is a bit friendlier if you want to work with these companies.
See also: How to Partner With Insurtechs
Step 3 — Who is on your innovation team?
We get the opportunity to speak at events all over the U.S. We often get asked, “How can carriers be more innovative?” Here are a couple ways:
- Carriers can engage and work with insurtechs. However, before the carriers engage startups, the issues they need to solve are the long sales cycles and the vendor procurement process discussed above. Once carriers have tackled these issues, working with insurtechs can immediately inject some innovation into the carriers.
- You can create an internal innovation team. This one is a bit more difficult. The question you need to ask yourself is, Who is on your innovation team? Many times, the people on these innovation teams are the folks who resist change. Often, we see the “quarter-century clubbers” on these teams. The quarter-century clubbers are the folks who have been in the organization for 20-25 years or longer. Don’t get me wrong, some of these folks can add value to the innovation team. However, some of these people challenge innovation. When you ask them, “Why do we do this process in this way?” the common response is, “That’s how we have done it since I have been with the company.” There lies the problem! You can’t expect to be innovative if you are not willing to have an open mind to a newer and better way.
My suggestion – add people to the innovation team who will challenge the status quo and who will interrogate the answer of “that’s how we have always done it”
Step 4 — You must take a little risk.
This is an easy one. Carriers need to take a little risk. WOW! There it is, I said it… Insurance carriers need to take a little risk in working with insurtech companies. I understand that carriers are risk-averse. However, I also understand that policyholders and beneficiaries are demanding a better customer experience out of carriers to earn their business. Startups are fast and nimble; most carriers are not. Carriers have a need and the capital; startups have the desire to succeed and can execute. When you can combine a carrier's needs and capital with an insurtech’s desire and execution, innovation WILL occur!
See also: How to Collaborate With Insurtechs
Here is a challenge
— Have you ever experienced your company's various processes? This would be a great exercise for many executives. Do not stage these experiences. Rather, be completely anonymous and go through your company's processes. Go through the processes on multiple devices.
Be honest with yourself and ask – does this process suck? If the answer is yes at any point in your process, you need a better process. This is an opportunity to innovate…