Attorney involvement has been steadily driving up workers’ compensation claims costs over the past decade. In 2014, the California Workers’ Compensation Institute (CWCI) published results of a five-year study that showed that when a single injured party brought in a lawyer the associated costs per claim went up by an average of $40,000 for permanent disability payments and $25,000 for temporary total disability benefits — even if the case never went to court. In Florida from 2016 to 2017, legal fees related to workers’ comp claims totaled nearly $440 million — approximately $254 million of that came from employers defending claims while injured workers themselves were responsible for $186 million (an increase of 36% in just one year). These cases do not bode well for anyone except law firms. Given this present reality, what can companies do to eliminate or at least minimize the effect of lawyers on the claims process? How can they protect themselves and keep costs from ballooning out of control while helping workers get back to their jobs faster? Here are three keys to consider: 1. Stop Litigation Before It Starts This is the No. 1 component in keeping costs down and workers happy. Contrary to popular belief, workers don’t want to sue their companies. They need their jobs and want to return to them quickly. But they also want to get results. Most attorneys are engaged only when injured workers don’t feel like their claims are being properly addressed. For example, they might not know how to get what they need, or they haven’t heard back about who they should see or what the next steps should be. To reduce the potential for attorney involvement, companies should leverage new technologies that apply artificial intelligence (AI) to search claims and assess the risk of litigation. These solutions can quickly flag claims that need intervention so that the right member of a claims team can step in and provide a bit more hand-holding, from making appointments on the worker’s behalf with doctors who have the best outcomes scores to conducting a basic check-in to see how the worker is feeling or how the recovery process is going. See also: Breaking the Cycle of Litigation in WC   Early intervention that cuts off litigation before it starts is the ideal scenario. Claims that steer away from an engaged attorney can save roughly $42,617 from direct claims costs. That’s not spare change, particularly when a company needs to address multiple claims. In one example from a recent CLARA study, a small regional carrier ran a six-month pilot using AI-based software to identify claims that were referred to a high-touch team. At the end of the pilot, the carrier reported that its “litigation rate went from 14% of all claims to 5%. This means that even a smaller carrier, with 20,000 claims per year, would save approximately $42 million in claims costs if it was only half as successful as the pilot example.” That’s a pretty substantial, tangible return on the investment in the software. 2. Identify and Engage the Most Effective Lawyers Some claims will move forward with a lawyer regardless of early intervention. But all is not lost! Just as all workers’ comp physicians are not created equal, neither are attorneys. Claims teams can still save a significant amount of money, time and frustration simply by involving the right lawyer. Outcomes-based attorney scoring is common practice. When this scoring uses machine learning algorithms, as the newest solutions do, the best attorneys for a case are right at the fingertips of claims teams. These lawyers can work toward a fair settlement before going through a long, painful litigation process (though in some cases, it is worth it to engage in litigation if demands are unrealistic, which a good lawyer would quickly recognize). 3. Use Smart Tools to Optimize Settlements It’s worthwhile to adopt AI-based solutions that can lend invaluable insight on optimized settlements for specific cases. Having instant access to quality, detailed information about similar claims can help determine whether to fight or settle a pending lawsuit. Machine learning provides leverage. This saves money. While avoiding attorneys is always the goal, smart tools can stop the bleeding when it is unavoidable. See also: Claims Litigation: a Better Outcome?   AI and machine learning have the capacity to change the upward trajectory in workers’ comp costs. With products and tools incorporating these smart technologies in meaningful ways, the claims process can be transformed from lose-lose to a win-win for both companies and injured workers.

P&C insurance carriers have witnessed a lot of changes in the past decade, but few have been as surprising as the shift of power currently taking place across the industry. According to Dennis Chookaszian, the former CEO and chair of CNA, carriers maintain only 40% of profits today, representing a drop of 20 to 25 points from the 1960s. An equal share now goes to the distribution system, as carriers line up to acquire and maintain more customers. What’s behind this shift in profitability can’t be summed up in a single word, but increasing competition, new market entrants, improving technology, changing customer expectations and continued consumer price sensitivity all play a role. To remain competitive, carriers will need to gain more control over distribution, a goal that even Chookaszian admits will not be easy to achieve. Why the Power-Shift Toward Distribution In the mid-part of the last decade, insurance carriers required two primary competencies to operate: data and capital. Because neither was easy to acquire, competition was less robust, and incumbent carriers found greater profitability, taking in roughly two-thirds of insurance transaction profits. Today, data is everywhere, and through the use of analytics, simpler than ever to understand and use. Capital is also easier to acquire, as is evidenced by the growing number of insurtech players in the industry. According to Willis Towers Watson, $2.3 billion was invested in new insurance tech companies in 2017. According to Chookaszian, the core competency for insurers now lies in distribution and control of the customer. “It’s become so competitive that the carriers basically are always out looking for new accounts,” Chookaszian says. That means higher commissions are paid to agents as carriers battle it out for market share, resulting in shrinking margins. "Given the shift in profitability to distribution, the carriers that will be better off will try to regain some control over distribution,” Chookaszian says. Admittedly, that is not an easy thing to do. The agent enterprise is part and parcel of most insurance operations. Directly selling insurance to consumers will require insurers to set up their own distribution systems, while still supporting their vast networks of independent or captive agent forces. See also: The Future of P&C Distribution   Distribution Goes Digital When Benjamin Franklin started the first successful U.S.-based insurance company in 1752, he was dealing with a localized Philadelphia population, but, by the end of the 18th century, citizens were moving westward, making it necessary for insurers to expand their distribution networks. The Hartford made the first foray into direct distribution by offering insurance through the mail, but few consumers of the time were willing to give up the personal services of an agent when it came to purchasing something as critical as insurance. Carriers of the time faced a similar dilemma as carriers do today: how to acquire customers in a changing marketplace. According to the J.D. Power 2018 US. Insurance Shopping Study, insurers are aggressively courting customers with new options and amenities as auto insurance rates remain stagnant and the number of consumers seeking coverage declines. "We’re entering an era of consumer-centric insurance that will likely be marked by a surge in new digital offerings and serious efforts by insurers to improve the auto insurance shopping experience,” says Tom Super, director of the property and casualty insurance practice at J.D. Power. This shift is happening across all lines of coverage, even small commercial. While citizens on the new 17th-century frontier may have been hesitant to buy coverage without the guidance of an agent, many 21st-century buyers have no such qualms. Nearly half of consumers responding to a survey conducted by Clearsurance said that they would purchase an insurance policy online, while 65% believe this will be the primary channel for purchasing coverage within the next five years. According to research conducted by Accenture, consumers are open to a number of new possibilities when it comes to buying the policies they need:

• 60% of consumers would purchase insurance from a bank
• 38% of all consumers are open to purchasing peer-to-peer auto insurance, with up to 50% of Generation Y saying they would accept this option
• 23% would even consider buying insurance from tech giants such as Google or Amazon, a number that has grown 23% since 2013

Power in the form of profits may have shifted to distribution, but consumers are making a power play of their own, demanding greater service and amenities and taking their business to the carrier most capable of meeting preferences and price points. In a world of shifting power, creating an active, online distribution channel puts more of the profit back into the carrier’s bottom line and allows it to attract more customers in three distinct ways. Cutting Transaction Costs According to a report from the Geneva Association, the leading international insurance think tank for strategically important insurance and risk management issues, 40% of P&C premiums are absorbed by transaction costs, leading to inflated policy pricing that drives away potential customers. PwC pegs distribution as a heavy culprit, reporting that 30% of the cost of an insurance product is eaten up in distribution. On the other hand, Bain predicts that insurers could cut the cost of acquisition by as much as 43% through digitalization. Underwriting expenses could drop as much as 53%. Reducing these costs allows insurers to present a more attractively priced product to consumers, an important consideration given that 50% of customers base their loyalty with an insurer on price. To understand how costs are reduced through digital distribution, it helps to understand how a leading digital distribution platform works to raise efficiency. According to PwC, up to 80% of the underwriting process can be consumed by administrative tasks that require manual workarounds, such as re-entering information into multiple systems. Much of this re-inputting of data is due to the siloed nature of insurers’ administration systems. Digital distribution platforms create a layer between the front-end online storefront, where customers enter application data, and the back-end systems used to store information. As consumers enter their personal details into the online application, all back-end systems are populated automatically, eliminating the need for manual work-arounds. Everyone across the organization has the same view of the customer and access to any information that has been provided. Digital platforms are also masters of straight-through processing, automating the quote-to-issue lifecycle and reducing the need for manual underwriting. By automatically quoting, binding and issuing routine policies, insurers reduce costs and also provide a more “informed basis for pricing and loss evaluation,” according to PwC. As costs drop, insurers are also able to more competitively price insurance coverage. Lower prices win more customers allowing insurers to take back some of the profitability of distribution. Improving Customer Experiences When it comes to insurer-insured relationships, there is a gap between what consumers want and what insurers provide. Consumers rate the following points as very important aspects of the insurance buying experience:

• Clear and easy information on policies
• Access to information whenever it is needed
• Ability to compare rates and switch plans
• A wide range of services

But few consumers agree their insurer is meeting these expectations: 27% see clear and easy information on policies 29% report access to information whenever they need it 21% say there is the ability to compare rates and switch plans 24% see a wide range of services The customer experience is becoming a key differentiator across the insurance industry. McKinsey reports two to four times higher growth and 30% higher profitability for insurers that provide best-in-class customer service, but here’s the rub. Only the top quartile of carriers fall into this category. Becoming a customer experience leader requires insurers to understand that the separate functions associated with policy sales and distribution appear as a single journey to consumers. They expect to quote, bind and issue multiple policies through a single application, using as many channels as they feel necessary to get the job done. While 80% of consumers touch a digital channel at least once during an insurance transaction, 45% of auto insurance shoppers use multiple channels when making a purchase. They expect to be recognized across these channels, picking up in one where they left off in another. The multiple back-end systems employed by most insurers present a strategic dilemma here, as well as in the area of cost containment. Without transparency between channels, consumers are forced to restart a transaction every time they change their engagement method. “It amounts to a great deal of frustration for the consumer,” says Tom Hammond, president U.S. operations, BOLT. “You start an application online and then call the customer-facing call center, and they can’t see what you did through the online storefront.” Hammond explains that digital distribution needs to be omni-channel distribution, seamlessly integrated with a single view of the customer. It’s the only way to meet consumer experience expectations now and into the future. Thanks to advances in analytics and artificial intelligence, the amount of data that is available to carriers has grown significantly, and consumers expect that information to be leveraged for their benefit. Eighty percent of consumers want personalized offers and pricing from their insurers. Progressive is one of the 22% of carriers currently making strides to offer personalized, real-time digital services, having recently released HomeQuote Explorer. From an app or computer, consumers can enter information once and receive side-by-side comparisons from multiple homeowners insurance providers. According to the company, they leverage a network of home insurers to make sure customers can find the coverage they need at a comfortable price. Oliver Lauer, head of architecture/head of IT innovation at Zurich, believes these collaborative networks are an integral part of the digital future of insurance. “Digital innovation means you have to develop your insurance company to an open and digitally enabled platform that can interface with everybody every time in real time – from customers to brokers, to other insurers, but also to fintechs and insurtechs,” Lauer says. Using a digitally enabled market network, insurers can fill product gaps and even meet customer needs when they don’t have an appetite for the risk. The premise is simple. By offering coverage from other insurers, they maintain the customer relationship and reap the rewards of loyalty. As society changes and consumer needs evolve, the ability to personalize bundled coverage to the needs of the individual will become increasingly important. Consumers are now looking for coverage to mitigate risk in previously unheard-of areas, such as cyber security, identity theft and even activities related to legalized marijuana. When an insurer is unable to provide the coverage a customer needs, it risks forfeiting that relationship, and any other policies bundled with it, to another carrier. But when the carrier takes part in a market network, it can bundle the appropriate coverage from another insurer with its own products, personalizing the coverage to better fit the needs of the customer. See also: Key Strategic Initiatives in P&C   Digital platforms offering market networks also set the stage for insurers to offer ancillary services, such as roadside assistance, that make their insurance products more attractive to consumers. We see this happening with increasing frequency as carriers seek to improve the customer experience and lift their acquisition efforts. DMC Insurance, a provider of commercial transportation insurance solutions, recently announced a partnership with BlackBerry Radar. The venture would provide transportation companies with real-time data on vehicle location, as well as cargo-related information, such as temperature, humidity, door status and load state. Information like this will help companies better manage risk. In the personal lines market, insurers are partnering to offer services that enhance the life of their customers. Allstate’s partnership with OpenBay allows consumers to review repair shops and schedule an appointment from an app. Allianz is helping home owners safeguard properties by partnering with Panasonic on sensors that monitor home functions and report issues. Customers can even schedule repairs through the service. Digital Distribution Benefits All J.D. Power reveals that digital insurers are winning the intense battle for market share in the insurance industry, starting a shift that could help level the profitability field between distributors and carriers. In a recent insurance shopper survey, overall satisfaction was six points higher for digital insurers over those that sell through independent agents. This lead grows to 12 points when compared with carriers with exclusive agents. According to research by IDC, digital succeeds on the strength of its data. The ability to collect and analyze the vast stores of data available through these interactions, including such variables as the time of day the consumer shopped for coverage, the channel the consumer used, and stores of information collected from third-parties as part of the automated application process, provides the key to improved customer service. “By analyzing this data, insurers can understand each customer’s lifestyle, behaviors and preferences in order to engage with them at the right time and place, offer personalized service and offers and more,” says Andy Hirst, vice president of banking solutions, SAP Banking Industry Business Unit. As insurers create omni-channel engagement, they’re strengthening distribution from every angle, giving consumers the option to quote coverage online when it’s most convenient for them, and then buy it right then and there or to seamlessly call an agent to discuss their options and their risk. Customer experience is rapidly becoming the foundation of success in the industry, and digital distribution provides the first link in building that base of core customer satisfaction. By providing consumers with multiple channels of engagement and the ability to meet more of their needs at any time, day or night, carriers are taking back the lead on profitability.

Workplace culture has been a hot business topic for some time, and interest shows no signs of abating. We’ve all heard about some of the “coolest” companies that tout their culture as a true differentiator. For example, tech giants Google and Facebook have been longstanding advocates for a strong company culture and as a result are leading examples of enviable places to work. Others such as billionaire investor Ray Dalio’s firm Bridgewater have embraced a very different version of culture – in his case one focused on “radical transparency” – and have seen similar success. No matter the approach, what these and other forward-thinking companies share is a passion and commitment to a strong workplace culture and its impact on their overall success. Culture has been at the forefront for me since the early days of forming my claims management consulting firm. Over the past 16 years it’s been a top priority as we’ve grown our workforce, and aimed to attract and retain the best talent in the business. As a small business, we see the impact of a strong culture even more. What we’ve honed has helped us not just in forming our identity but also with creating a set of values that drive how we interact with our customers. However, in working with many claim operations over the years, we’ve seen how many are still late to the party when it comes to prioritizing workplace culture. While some are scratching at the surface with remote work opportunities and agile work environments, few have fully embraced culture as an unquestionable tenet. Even beyond the impact it has on talent acquisition and retention, we think it can also serve as a driver for better risk management and customer service results. Workplace Culture – Do We Know It When We See It? As much as we may think we know about workplace culture, maybe we should step back and try to define it. If you Google this term as I did, you might get 10,000 or more results. While there’s no shortage of research on the topic, there are some common themes that are key to building a solid foundation. Shared Purpose Employees like to know that they are doing meaningful work and feel connected to their employer’s reason for being in business. Sharing a common set of values with their employer and understanding how their unique skills fit into the bigger picture are important to employees seeking meaning from their work. Identifying with a greater purpose is often tied closely to feeling successful, which is also highly motivational. Employee Recognition Employees often fail to meet their full potential if their contributions are not regularly appreciated. Employers who take the time to acknowledge good work see increased loyalty among their employees and even improved job performance. In fact, it’s so important that according to social scientist Dan Ariely, whose research covers the drivers of motivation, “When we are acknowledged for our work, we are willing to work harder for less pay.” The challenge for employers is finding the right way to show appreciation, especially since everyone responds differently to varying types of acknowledgement. Workplace Diversity Beyond expanding the talent pool, companies focused on diversity see improved employee performance. With a broad range of life and work experiences reflected, decision making by a diverse group produces better results. A culture that recognizes this and commits to it can truly be more successful. Work Environment Environment is one of the most important aspects of culture. In recent years the focus has been on an open environment to improve collaboration and productivity. In fact, about 70% of U.S. companies now have some type of open floor plan. In addition, flexible schedules have also become more common, as has remote work. Companies that focus on flexibility and the environment in which we work see a more productive and engaged workforce as a result. Personal and Technical Development Employees embrace opportunities to contribute, learn, experiment, and to develop new skills. They want to know they have a clear path to growth within their company, which ensures a strong future. According to Gallup, only four in 10 U.S. employees strongly agree they had opportunities in the last year that allowed them to learn and grow. This clearly needs to be more of a focus for employers as they compete for talent, especially among younger generations. Transparent Communication Fostering a great work culture depends on open and honest communication. Communicating with employees consistently and directly leads to improved levels of trust in their employer. Companies must commit to this as a practice from the highest level throughout the entire organization for it to impact the culture. While the above isn’t by any means comprehensive, it touches on many aspects of a strong workplace culture. When it comes to the insurance industry, and specifically claims operations, we’ve observed over the years where they are committing resources to building a strong culture, and whether it’s been paying off in terms of business results. In fact we recently conducted an informal poll of Disability and Life insurance claims professionals to hear more about trends in their workplaces. For example, several told us that they have flexibility in their schedules and work location, and a majority reported working in an open, “collaborative” office environment. When asked whether they believe these factors impact productivity, more felt flex schedules contributed than work environment. For claim professionals this flexibility to when they work may be even more critical given the level of intensity and burnout that can happen in this field. See also: How IoT May Revolutionize Claims   Looking at additional factors, having consistent and open communication from management was most influential to their level of satisfaction. An engaged team can only serve insurers well as it means commitment to the work and loyalty to the company. If we revisit these themes again from the perspective of claims management, here’s what we believe are the most significant ways culture can have an impact: Shared Purpose For claim analysts, it can be extremely challenging to keep in mind the greater purpose – deadlines and complicated case details can easily supersede that. Are team leaders reminding them of the meaningful work they do? Does the company frequently and publicly cite examples of how customer lives are impacted by the great work that the claim team is doing? In reality, the focus for many is on impersonal metrics built from the command and control environment. While we need hard numbers to gauge productivity, the story of what’s being achieved and why it matters is also important. Employee Recognition Taking time to acknowledge those claims that were particularly well handled and acknowledging the analyst’s efforts is important. Sharing this with others on the team can then serve to motivate them, causing a ripple effect. A team that sees their value is recognized is simply going to focus on delivering their personal best. Workplace Diversity While we often think of race and gender as key aspects of a diverse workforce, what about age? Like the rest of the insurance industry, the graying of the workforce is something to address. Finding ways to attract younger workers and from more diverse backgrounds is necessary to creating a stronger claims operation in the long run. How often do you encounter a Millennial who has figured out how to do something much more efficiently? This “life hack” generation has a lot to offer us in terms of openness to learning new technologies and improving our processes. Likewise, older generations have much to offer in experience and wisdom. Baby Boomers for example are remaining in the workforce longer by delaying retirement, allowing for more opportunities to mentor and collaborate with younger counterparts. Work Environment We all have the co-worker who just can’t dial down the volume meter. Or the colleague who insists on talking to themselves for all to hear. Working in an open environment can make these issues even worse, and for those working on complex claim reviews it can be downright counterproductive. While there are benefits to a collaborative space, claim analysts can be challenged to read and analyze detailed documentation, or have sensitive phone conversations in these environments. Creating a space tailored for critical thinking and quiet is important. Even better, allowing them the flexibility to work from home or set their own hours can encourage productivity and efficiency, and greater job satisfaction overall. Personal and Technical Development There are many organizations that likely have a focus on technical development for their claims teams. However, rounding out this training to include softer skills like communication and empathy for example can also be just as valuable to their ongoing success. After all, what good is it to be able to follow all processes and remain compliant if they can’t effectively communicate with claimants and make key connections? Offering a well-rounded training program that encourages these additional skills can only serve to enhance job performance and satisfaction for analysts. Transparent Communication One of the key components of any engaged workforce is feeling connected with management. When we recently polled claims professionals about several key factors related to their productivity, the level of communication was the item most often given the highest ranking for level of influence. Being consistent and clear in communications is needed with any profession, but especially in occupations like claims where analysts are working independently, and now more often remotely. See also: Getting Culture Right: It Starts at the Top   In Summary Workplace culture is more than just a buzz phrase – there are legitimate and quantifiable reasons a company should prioritize it. For those working in the insurance industry, there are unique challenges to fostering a winning culture - attracting younger workers, keeping up with and leveraging new technologies, and promoting a sense of purpose for their employees to name a few. For those on the front line with claims management, the more engaged and productive they can be, the better the results for not just insurers but their customers.

With so much focus on the detail of GDPR, let’s take some time to look at the business lessons from this external change. Whatever the size of your business, the world around you changes, and you need to be able to adapt. Regulation is just one of those key drivers of external change. So, to help us reflect on the business lessons from preparing for GDPR, I’m delighted to welcome back guest blogger William Buist. William mentors and advises business leaders, helping them get greater clarity. So, he is well-placed to lead us through this business-focused review. Over to William to draw out those lessons… Business lessons from GDPR readiness, or not GDPR was on the back-burner, for many businesses, for sometime. At least until recently. But, in the last few weeks, we have seen our in-boxes bulging, with businesses seeking to obtain the approval  they need for their marketing lists. It’s been interesting to watch the different ways in which businesses have approached this. It’s the same set of instructions and requirements from the Information Commissioners Office (ICO). They are not all compliant, but many are. Most lack subtlety, almost all miss some aspects of the reason these regulations are being developed. That’s a symptom of confusion, and it is absolutely normal. I’m not going to rehash the detail of the GDPR (we’ve all had enough of that by now!) I thought it would be interesting to consider what the general learning is, about external change. Learning that businesses can draw from the exercise of becoming compliant with the GDPR. I think there are five key lessons. 1. However early you start, it’s probably too late to do a perfect job Almost by definition, external change pops up only when it’s easy to spot. People are talking about it, and you wonder why you hadn’t heard. By the time you catch up with what is happening, the deadlines seem close. The best thing to do, is to keep your ear to the ground. Your network is probably whispering, about a couple of things, that will affect you in 2019 or 2020 already. If you can spot which ones you need to take action about now, you can be ready and relaxed. (Hint: if you use associates or contractors, take a look at upcoming IR35 changes). Be visionary. See also: What GDPR Means for Insurance Companies   2. You are aiming for a moving target Most external changes, like GDPR, are evolving. They continue to evolve for some time, after the ‘deadlines’, as working practices embed & difficulties are ironed-out. Businesses that thrive, look for the intention behind the change, and think strategically, about how to deliver that intention. Rather than thinking tactically, about the current need. Spend time identifying what your relationship, with the intention of the change will be. How you will express it, embrace it, and champion it? Be agile. 3. There are no experts about the impact on your business, and there may be no experts at all External changes aren’t driven with your business in mind. Nobody has enough experience to be an expert. They are just more, or less, knowledgeable than you are about this change; but always less knowledgeable about your business. Check what other say, seek evidence. One example: “privacy policy” is not mentioned in either of the relevant legal frameworks. Neither the Data Protection Bill, nor the GDPR regulations. Now, I’m of the opinion that a privacy policy/notice may be a sensible way to evidence your policy and processes. But it will not, and cannot, of itself, make you compliant. Rather than experts in the thing that is changing, seek out the experts in the work that you need to do. Hire the best implementors and strategists, before your competitors do. Be adaptive. 4. In the long-term, you will wonder how you managed today External change, that affects all businesses (like the introduction of email, or GDPR) can seem like an imposition. Something to be resisted, but ultimately, advantageous. It’s hard to imagine doing business, with a typing pool and snail mail, yet for many years that was the best we had. GDPR will change the way that businesses do their marketing. The better targeting and stronger trust(*), that will arise in the long-term, will seem like a norm that will make today feel antiquated, even ‘quaint’. (*) The P in GDPR is important. Protecting the data of the people you work with, using it responsibly, and sensibly (and being seen to do so) is how trust develops & thrives. That will take time, and it has to be authentic. Be trustworthy. 5. Just because you can’t see the opportunities, doesn’t mean they aren’t there The world will be different, after all that’s what significant change does. In a different world, opportunities are also different, and far less visible, at least until you ‘get your eye in‘. The best businesses scan the horizon, for things that they can use today, to deliver a better business tomorrow (than it was yesterday). It’s worth spending strategic time, to identify what opportunities might exist, in this new world, and how they might be made visible. The best do this habitually. Habits form from regularity. By making these things conscious, you make it more likely you can see the opportunities, than less. Be pragmatic. GDPR may have (just) been about data, and its protection. But it teaches us all to be visionary, agile, adaptive, trustworthy and pragmatic. See also: How to Avoid Being Bit by GDPR (Part 1)    

This is my first week at Bold Penguin... marking the true beginning of my insurtech life. I've followed insurtech for more than three years, writing and speaking on the movement, but my vantage point has always been one of the intrigued outside observer. And while one week does not make you a qualified insurance technology startup guru, here are my first seven insights after diving headfirst into my new role as chief marketing officer at Bold Penguin.

1) Small Business Insurance Is the Holy Grail McKinsey & Company has been referring to the SMB market as one of the "few bright spots" in the property/casualty insurance sector for years now. Why? Because no one owns the small business insurance space. The marketplace is fragmented, and generally speaking the commonly accepted customer experience is poor at best. Yet, done right, small business insurance is a growing and profitable market segment. This is by no means breaking news. That doesn't diminish the fact that no one has small business insurance figured out, (except maybe...), making the SMB market the holy grail of meaningful organic growth for the foreseeable future.

2) There Is No Road Map In case you've never worked for a startup before, there is no road map for success. Insurtech startups are creating solutions that haven't existed before. Look at the work that Chris Cheatham is doing in policy automation at RiskGenius or Mike Albert and Allan Egbert are doing in open APIs at AskKodiak. Quite literally, they're making things up as they go along. ...because they have to. The work lives in uncharted waters. My point is, just as insurtech startups must mature into the greater insurance ecosystem that has existed for more than 400 years, the more traditionally oriented organizations (and individuals) must accept the slightly more haphazard nature of startup companies. Insurance carriers with open-mindedness to the realities of trailblazing startups will position themselves out front as the partners of choice for insurtechs mapping solutions for our industry's most challenging obstacles.

See also: An Insurtech Reality Check  

3) There Is a Race to Remove Friction Research from a McKinsey & Company survey shows a 73% increase in customer satisfaction when customers reported they were pleased with the entire customer journey, not just specific touch points.

Winners and losers of the digital insurance revolution will be determined in the race to remove the most friction from the customer experience.

This doesn't mean removing human agents or blowing up the traditional insurance carrier model. Rather, we must think of insurance as a service and create flow throughout the customer journey. I joined Bold Penguin because it's my belief that their solution will be the foundation upon which many winning agents, brokers and carriers build their unique customer journey. Whether you partner with Bold Penguin or not, make no mistake, the race to remove friction is real and it's happening right now. If your organization is not having serious conversations about the customer journey, you're already losing.

4) It's Time to Ask "What if?" It's time for everyone to start asking "What if?" when it comes to the future of insurance.

• What if APIs are the future?
• What if customer experience is all that matters?
• What if we can't build it ourselves?
• What if half our agency plant retires in the next five years?
• What if our carrier partners demand digitization?

Whether you believe these scenarios will come true or not isn't the point. The insurance marketplace is changing rapidly and being prepared for all the "What if?" scenarios possible is the only way to survive... ...because no knows what's actually going to happen.

5) Disruption Is Dead From now on, every time you hear the words "disruption" or "disruptor" come out of a startup's mouth, your insurtech B.S. alarm should leap to life, the blaring sirens and seizure-inducing flashing lights overwhelming your senses while an impenetrable B.S. Protection Barrier envelops your entire body like some scifi force field. Seriously though, disruption is not the answer. Instead, insurtechs should focus on collaboration, facilitation and integration with traditional partners, building on the previous foundation as much as possible and alongside where it does not.

6) Culture, Culture, Culture I've seen first-hand the impact a toxic culture can have on organizational success. We live in a tumultuous time for workplace culture. According to the American Psychology Association, the workplace continues to be a leading cause of stress (with 61% of Americans listing work as a significant stress factor). We're under more pressure to spend more time, to get more done every single day. Work-life balance has become a cliche joke. While I believe in hard work, giving more of yourself than is asked in the job description and just kicking ass in general, organizational culture must be a fit to achieve our goals of world domination. Here are three aspects of insurtech culture vital to success:

1. Always put staff satisfaction first. An inspired team believes, an uninspired team blames.
2. Never blame the customer. Period. Own your outcomes. The customer may not always be right, but the customer is never wrong.
3. Don't take yourself too seriously. As an old mentor used to tell me, "Everybody ?s."

I'm sure there are more. But these were the three most obvious to me after spending time at the Bold Penguin headquarters this week.

7) Your Story Matters Your story matters as much as your product. It doesn't matter how amazing, revolutionary or game-changing your product or solution is, if your story doesn't make sense, if people can't connect the dots between your solution and how it benefits them and their organization, your product essentially doesn't exist. This is something we need to do better at Bold Penguin. We're not amazing at telling our story today. We're going to change that. One of many reasons I joined Bold Penguin was that the whole story had yet to be told. I feel like I've found a gigantic diamond just lying there on the sidewalk. And while everyone else walks past, oblivious to the treasure they've just nonchalantly stepped over, to the trained eye all it takes is a craftsman-like approach to telling the story of what Bold Penguin can do for insurance agents, brokers and carriers to unlock industry defining value.

But Bold Penguin isn't alone. Wait until you hear about what Joseph D'Souza is doing at ProNavigator, or Jason Keck at Broker Buddha, or Phil Edmundson at Corvus Insurance. Having a great solution is the barrier to entry. For anyone to care about your company, you must to be able to tell your story.

See also: Innovation: ‘Where Do We Start?’  

The Rub According to the most recent CIAB Market Study, "Driving organic growth, hiring and recruiting talent and enhancing the customer experience remain top organizational priorities" for the U.S.'s top insurance brokerages. With 80% of CIAB's responding agents and brokers listing “driving organic growth” as a top priority for 2018, it's exciting to be part of a company working to solve organic growth concerns, not through disruption but through collaboration, facilitation and integration.

You can find the article originally published here on LinkedIn. Click here to learn more about Bold Penguin.

Awareness is the best insurance policy. It saves costs by saving lives. It is as important to the fate of the insurance industry as it is to fate of the entire nation. The awareness I refer to comes from recognizing the risks we face and the ways we can solve them, starting with the one thing that is both portable and invaluable: education. The more educated a person is, in terms of his or her ability to perform a life-saving procedure such as CPR, the safer everyone will be. Put another way, the education of one translates into economic rewards for many—from fewer hospitalizations and lower medical fees to more affordable health insurance and better options in general. Or: Sometimes, the most practical skills are the most profitable. CPR is such a skill, which not only save lives but strengthens communities. For those communities most in need of help, where first responders are too far away to be the first ones on the scene, the person who knows CPR is the man or woman who can save a life. Compare that scenario with the alternative, where an ambulance belatedly arrives and the patient hovers between life and death. Picture that patient in a hospital, unable to breathe without a ventilator and unresponsive to the simplest gestures. Whether that patient is rich or poor is no matter, not when the richness of life itself vanishes and medical bills are a matter for insurers to pay or to decline to cover altogether. If insurers want to avoid that scenario, they should invest in what works. They should support organizations whose mission is to save lives by teaching life-saving techniques. See also: A Road Map for Health Insurance   According to Mackenzie Thompson of National Health Care Provider Solutions (NHCPS): “Interest in learning how to perform CPR is a global initiative. From Africa to the Americas, every village or township needs to be empowered with life-saving knowledge. In fact, more people from the U.S. access our online certification courses on CPR than any other nation. If saving lives saves insurers money, all the better.” I agree with that statement, as it is neither too complex to achieve nor too controversial to accomplish. In other words, teaching CPR does not involve creating or maintaining huge bureaucracies. It does not involve legislation that divides the public or strains people’s finances. It does not take too much time to practice or too many practitioners to attract supporters. Do not underestimate, also, the power of goodwill. Which is to say the insurance industry has everything to gain—and nothing to lose—by popularizing what is good for its beneficiaries and a benefit to itself: life. The healthier people are, the less costly it is (or should be) to insure them. The happier they will then be, too, because they are alive and well. If insurers want to see the ROI on CPR, they should look to the individuals who owe their lives to this procedure. They should look to promote CPR in every county, city and state. They should look at themselves as champions of change.

Workplace violence is a daily threat to workers in many industries. Aside from mass shootings, which grab headlines, more than 2 million workers are victims of violence every year. The issue is a challenge for employers striving to maintain a safe working environment for their employees. By understanding the scope of the problem, the underlying reasons for violence and the types of violence that threaten specific industries and workplaces, organizations can make a significant impact on reducing incidents against their workers. During a recent “Out Front Ideas with Kimberly and Mark” webinar, we had two prominent experts join us to discuss this very challenging issue:

• Bub Durand, practice leader of medical group support services for Kaiser Permanente’s Northern California region
• George Vergolias, PsyD, vice president and medical director for R3 Continuum

Scope of the Problem OSHA defines violence as any act or threat of physical violence, harassment, intimidation or other threatening disruptive behavior that occurs at the work site. That includes everything from threats and verbal abuse to physical assaults and even homicide. Many employers, however, are wary of even discussing the issue out of concern that people will view their particular companies as being overly violent. In fact, several potential speakers in retail and other industries we approached to join our panel declined for this very reason. Despite their reluctance, we know that the workplace has increasingly become the site of violence, especially in certain industries. Healthcare Healthcare is the industry that generates more attention than any other with regard to violence – and with good reason. The most recent government statistics show there are 7.8 cases of serious violence per 10,000 employees, which far exceeds any other industry, and that number is likely much lower than the reality. Many healthcare facilities, especially in high-risk areas such as emergency departments and Level I trauma centers, are routinely the sites of violent outbursts. Patients or their families attack providers all too frequently. Many of these workers have come to believe violence is just part of the job. Unfortunately, those in a position to change this often foster that culture. We may soon see an increase in the numbers of incidents reported, due to mandates for increased reporting, especially in California. Schools Mass shootings at schools have been getting lots of attention. However, not talked about is the fact that schools are increasingly the site of daily violence or threats by students against teachers and staff. For example, one of the nation’s largest school districts reported a 10% increase in violence-related claims in the past five years. With incurred losses of $19 million, these claims represented 15% of the total and 12% of the system’s incurred losses. The numbers do not include many of the threats and harassment incidents, which often go unreported. One reason for the increased number of violent incidents reported in schools may be the increased awareness of the issue and the potential for remedies, both legal and administrative. Another is the implementation of zero-tolerance policies that require or strongly recommend reporting. One more is the increase in kids acting on their emotions, more so than they did in past years. Overall, workplaces have seen an uptick in homicide rates in recent years, even though the rate in the general population has decreased. Some experts speculate that may be due to increased stresses facing workers, such as financial pressures. Social media may play a role in increased violence in the workplace, because it seems to empower some people to act in ways they normally would not. This sometimes spills over into real-world, face-to-face situations. On a positive note, efforts to reduce violence in the workplace are paying off. While homicides among government employees increased 30% between 2003 and 2013, the rate decreased 30% in the private sector. See also: Broader Approach to Workplace Violence   Types of Violence Developing violence-prevention programs requires knowing the type(s) of violence to determine the best approach. For example, gender may be part of the equation. Men are more likely to be killed at work during robberies, especially in retail establishments, while women are more likely to be victims of domestic violence. Domestic violence is one category that is often not adequately addressed in the workplace. Many employers believe that, because the potential perpetrator is not an employee, he is not a threat to the workplace. Statistically, it is a very real problem that should be considered and included in violence prevention plans. In fact, violence can be initiated internally or externally. It may be started by an employee within the company, or externally by a customer, former employee, vendor or someone connected with an employee. There are also emotional vs. predatory incidents of violence. Knowing what drives each incident category is important to help prevent it.

• Emotional violence generally occurs as a reaction to a threat or fear. An example would be two boys ready to duke it out in school. Neither actually wants to fight, but they also do not want to be humiliated, so they pretend they are ready. Diffusing this situation can be done by intervening and stopping both of them equally.
• Predatory violence involves forethought, rather than being reactionary. A sniper is an example of predatory violence. Preventing these situations is much more complex.

Temporary States vs. Emotional Traits Some attacks occur because the person is temporarily in a highly emotional state. It could be an emotional reaction, a psychotic episode or a drug-induced state. A permanent trait, on the other hand, means the person has a personality factor that is driving him to act in a demeaning or abusive manner. Those traits are more consistent and predictable over time. An example of someone in a temporary state would be a father who has just been told his wife was killed and his child is in surgery following an auto accident, and he speaks very little English. His inability to fully communicate, and his efforts to see his son in the emergency room, could easily lead to a violent outburst. Security personnel might be inclined to handcuff the man, per protocol. However, such a situation can be diffused by understanding why he is acting the way he is and getting a language interpreter to speak with him calmly. It is important to understand the context of the violence and not assign permanent traits to someone who is only in a temporary state. That can sometimes be tricky, especially if a zero-tolerance policy is in effect and mandates that security personnel handcuff any violent perpetrator. If someone is acting out in hostility, especially if it is atypical behavior for that person, asking questions can help prevent an incident. This can be especially effective in the case of students at school; pulling the person aside to find out what is driving his actions is often effective. Assessing the Risk There are many ways to determine the types and levels of risk to an organization.

• Traditional assessment. One approach includes a traditional security risk assessment of the grounds, the physical security environment and the security practices and policies, using specific metrics and historical performance of law enforcement and risks in the local community as factors.
• High-risk area assessment. As Bob explained, a new California law addressing workplace violence in healthcare has led Kaiser Permanente to conduct additional assessments of its facilities. One involves looking at high-risk areas, such as emergency rooms. The type of risks present there could include family members worried about patients who have been brought in, or patients left waiting because their injuries are not life-threatening, and they become impatient and agitated. These assessments look at the safety and physical security practices along with engineering controls.
• Administrative and workplace controls. These focus on ways to distinguish employees from visitors. Kaiser Permanente, for example, requires workers to wear ID security badges from the waist up.
• Employees’ knowledge. Part of assessing risk is to determine whether staff members know what to do at the first sign of a threat; do they know the security code to call, and what to expect as a response? Employees also are assessed to make sure they understand they may sometimes have to call in outside law enforcement and must know how to do that.
• Physical layouts. A patient who presents a danger to himself and is brought in involuntarily needs to be placed in a safe room. The assessment would look for any dangerous objects in the area the person could use to injure himself. Staff members are quizzed to ensure they understand what needs to be removed from such an area.
• Remote worker assessment. Many healthcare or hospice workers go to an offsite home or other location. Because the risks are often unknown in those environments, employees need to understand what to do. For example, the worker could ask whether there are any firearms in the home.

It is also important to assess both safety and security because they are different. Security would include a door in a particular location of the facility that serves as an exit, that visitors cannot enter. However, a worker who props the door open, even briefly, defeats the purpose. Employers need to promote a culture of safety within their organizations, as well enhancing security. See also: New Idea for Active Shooter Incidents   Training The best workplace violence policies mean nothing if people are not trained on them. Employees need to clearly understand what to do in a given situation. Training should be conducted at least annually and with any new hires, and employees should be given competence testing regularly. Staff members need to be clear on the expectations of security personnel or they increase their own risk of becoming victims of violence. Proper training also improves legal defensibility. An important point to emphasize in training is to examine the threats to each particular work site and each specific area of a work site. While the same policy may apply, there may be different priorities depending on the risks and the employees. A one-size-fits-all approach should be avoided. It is also important for the trainer to understand what the policy says before starting the training. A zero-tolerance policy is different from others. Unfortunately, some companies seek training before a policy is fully developed. In addition to training staff on policies, management must adhere to it. Otherwise, they risk creating a toxic work environment if someone reports a concern that is ignored. The trainer needs an adequate amount of time to perform effective training. It is imperative to make sure employees fully understand the policies and procedures. Threat Responses There are a variety of ways for employees to mitigate violent threats in the workplace:

• Be aware. Being aware of the surroundings, how the worker is feeling and how the other person is feeling is important. The other person is likely feeling agitated, so the worker must be able to stay composed.
• Understand/do not judge. Where possible, engaging the person can prevent a violent incident. Workers can try to find something they like or have in common with the person.
• Explain the consequences and alternatives. Angry people are not thinking clearly. Nor are they thinking about how actions will affect their lives or families. Calmly explaining the ramifications can help.
• Change the tone of voice. Speaking calmly to an agitated person may help reduce his anxiety.
• Avoid provoking. Telling the person to “just calm down” could make him more angry.

The goal is to help redirect the person so he slows down and begins to think more clearly.

The long-awaited decision by the California Supreme Court in King v. CompPartners (2018) S232197 is finally out. In it, the court unanimously held, through a majority and two concurring opinions, that a claim for malpractice against a utilization review (UR) physician for injuries arising from a review decision for the treatment of a compensable injury could not be maintained under the workers’ compensation system and is barred by exclusive remedy. The case will be extensively analyzed by all participants in the workers’ compensation system. This will include parsing of various comments in the two concurring opinions regarding whether the UR process is performing up to expectations. As noted by Associate Justice Goodwin Liu in his concurring opinion, “The legislature may wish to examine whether the existing safeguards provide sufficient incentives for competent and careful utilization review.” The other concurring opinion, by Associate Justice Mariano-Florentino Cuéllar, stated, “Even now, those safeguards and remedies may not be set at optimal levels, and the legislature may find it makes sense to change them.” It is difficult to find a point in time where a thorough analysis of the system is contemporaneous with the judicial review of it. Such is the case here. The utilization review events that caused this case to be brought occurred in 2013. Given that this case was dealing with a review of prescription drugs, it is important to note that “safeguards and remedies” now include the Medical Treatment Utilization Schedule Formulary. As stated in the formulary, “ For injuries occurring prior to Jan. 1, 2018, the MTUS Drug Formulary should be phased in to ensure that injured workers who are receiving drug treatment are not harmed by an abrupt change to the course of treatment. The physician is responsible for requesting a medically appropriate and safe course of treatment for the injured worker in accordance with the MTUS, which may include use of a non-exempt drug or unlisted drug, where that is necessary for the injured worker’s condition or necessary for safe weaning, tapering or transition to a different drug.” [8 CCR 9792.27.3(b)(1)] See also: Where the Oklahoma Court Went Wrong   This particular regulation also states, “Previously approved drug treatment shall not be terminated or denied except as may be allowed by the MTUS and in accordance with applicable utilization review and independent medical review regulations.” [8 CCR 9792.27.3(b)(4)] In addition, Senate Bill 1160 (Mendoza) requires UR processes to be accredited by July 1, 2018. The accrediting agency is URAC, although the Division of Workers’ Compensation has the authority to add requirements for certification. The purpose of accreditation is to have an independent, nonprofit entity “…certify that the utilization review process meets specified criteria, including, but not limited to, timeliness in issuing a utilization review decision, the scope of medical material used in issuing a utilization review decision, peer-to-peer consultation, internal appeal procedure and requiring a policy preventing financial incentives to doctors and other providers based on the utilization review decision.” [Labor Code Sec. 4610(g)(4)] Much has happened to the system that was under review by the court in King. To improve on this progress, we need to understand what has been done already to provide more safeguards and remedies for injured workers while being faithful to the “grand bargain” that is workers’ compensation. This cannot be done by turning back the clock.

I'll be quick this week because I'm a bit out of touch and more than a little tired, having spent the past three days driving my younger daughter's household goods from home in Northern California to Washington, DC, where she just started law school and moved into an apartment. (Sunday was the big day—1,250 miles—for those keeping score at home.)

I could tell you a lot about the history of Rome, having spent almost the entire trip listening to a podcast on the subject. Instead, I'll point you to two articles that surfaced last week and that underscore themes that I believe are crucial.

The first article, on "business process elimination" (as opposed to business process outsourcing), reminds me of a line from my old friend and colleague, Gordon Bell, who developed the first minicomputer back in the 1970s. He said that "the most reliable part of a computer is the one you leave out." Peter Drucker stated the principle more generally and famously when he said, "There is nothing so useless as doing efficiently that which should not be done at all."

We in insurance need to keep that principle in mind as we use technology to become more efficient. There are many things we should simply stop doing. No amount of effort should be spent on using fax machines more efficiently, for instance. They, and many other insurance anachronisms, need to just disappear.

The second article is a dramatic story about a drone saving a woman who was drowning 230 feet offshore in Spain. It would have been tough for a lifeguard to fight through the surf and reach her in time—but a drone got there. It dropped a life vest that inflated on impact, and she managed to grab hold and save herself. The drone kept watch on the woman and some friends, who were also struggling, until the lifeguards could get there.

That sort of story is worth keeping an eye on because, while a lot of the focus thus far for drones has been on their use in assessing damage following home fires or natural disasters, drones can also prevent a lot of injuries and deaths. The International Association of Certified Home Inspectors, for instance, reports that 164,000 inspectors fall off ladders just in the U.S. each year, and that 300 die. Imagine how many injuries and deaths can be prevented as drones replace ladders.

Then imagine all the other things that we as an industry can use technology to do if we move our focus past paying people after bad things happen and work to prevent those bad things from ever happening.

Have a great week.

Paul Carroll
Editor-in-Chief

Insurance companies with legacy systems can find it extremely challenging to bring their data together because of different data formats and system access methods. They might have multiple sources of content with similar information for customers, claims, agents, books of business — information that, like in most organizations, was acquired over time or resulted from a merger. They might have mainframes and relational systems, and then they bring in third-party data. Add the fact that the insurance agency is invested in digital transformation, and you realize that the insurer’s relationship with the customer is changing. The relationship with the customer used to be managed by the agents. Now, there’s a desire to manage customers more directly by the actual insurers and bring in that data. The complexity of the underlying data sources and the data they want to bring together makes this difficult. The challenge is trying to move all the data into some sort of central, unified location, but insurers are not able to do it at the scale that they would like. There are many attributes related to customers and policies and claims. So, instead of bringing all that data together and asking all the questions that insurers would like to ask, they cherry pick three or four. They spend a lot of time writing extract, transform and load programs, as well as other data processing pipelines, to move data from the source systems into some sort of target schema. So, the day to day is a lot of gnarling, churn, programming and data movement to answer a slimmer portion of the entire question set that companies would like to ask of the data. See also: Workplace Wearables: New Use of Big Data   Modeling Data to Detect Fraud When it comes to fraud indicators, there are many signs that can be identified by the relationships in the data. For example, on a policy application for insurance, there are phone numbers, addresses and the relationship to an agent or an organization who sold the policy to the individual. If someone gets a policy with one agent and then tries to get a similar policy with a different agent, the applicant could be shopping around for the best deal or the agent could be trying to give someone a policy he doesn't need. But relational databases typically aren’t good at highlighting these types of issues. In addition, while some things that are more easily modeled as a graph, the hierarchical data in insurance is typically put into rows and columns and tabular format. For example, in insurance, a book of business can belong to an organization or an agent, but an organization can have agents, which can have a book of business. It’s a recursive model. If you want to understand the relationships and examine some sort of policy tied to them, the analysis can get very complex. But when you put the data into a graph, where you have it modeled as entities and relationships, you can quickly pattern match to see who are the individuals and agents who have a relationship to a policy or application. A person should only have one type of relationship to a certain type of policy. When you compare and quickly visualize and see this person has two relationships to two policies that are similar, you can ask, “Why?” You can very quickly tease out that there is something there. If the pattern doesn’t match, the issue is quick and easy for you to identify. There is a similar scenario for agents. Agents can sell certain policies and not others. When you model the data as a graph, you can say this agent has an inappropriate relationship to a policy. A one-line, simple query can expose the agents who are engaging in this type of behavior. Also, when you have that visualization of their relationship to the policies they are and aren’t allowed to write, an actual physical pattern emerges of those relationships, where it gets easy to identify and spot who is up to nefarious or questionable activities. Using Data to Prevent Fraud There is a lot of complexity in these organizations and in how agents, customers and the insurers interact. If an insurance organization were going to start a modernization project around fraud investigation and fraud prevention, it should leverage the technology that allows it to quickly manage information as a graph. Property graphs are very adaptive; they are additive. Traditional data integration requires that you must understand all your sources and all the attributes before you begin. Then you come up with the schema to encapsulate all the data, and that’s what the proposition is. This encapsulation takes years, and no one ever hits the target because business sources and targets change. With graph technology, you can start to rapidly connect just the data you need as you need it and continue to append and add to those graphs to create a rich view of the data landscape. With a graph, you can start to tease out things and use the relationships where addresses, phone numbers and emails become things unto themselves related to a person, policy or a claim. See also: 5 Key Effects From AI and Data Science   The reason you want to do these types of things is because you can quickly start loading hundreds of thousands of policies and claims and applications into the system, and you can start to look at things like shared addresses, shared numbers and shared email addresses. Very quickly, you can start to see who is up to legitimate activity and who is up to illegitimate activity. There are indicators regarding things like a phone number. Fraudsters tend to use the same phone number for all fields of any policy applications. When you load these applications together and examine at scale, you’ll see in the data that no one else has a relationship to the phone number the fraudsters have used. But it’s common to see people share phones in a home or office when they’re not engaged in fraud. You can tease out those relationships, as well. Another example is address information. When you look at policy applications, the person’s address shouldn’t necessarily be the same as the employer’s address or the agent’s address. There is value in having the entities and relationships to model, so you can quickly identify who has the appropriate relationships to which entities. You can see if someone is even a policy holder, if the person has any relationship with the agent, if the person has the same address as the agent’s, etc. When you load all the data into the system, relationships allow you to quickly see the behaviors between the transactions. This is one of the key benefits of working with connected data.