The direct channel has a major impact on the distribution landscape, as customers become the focal point for every transaction and sale. More agents consider the market shift toward online or direct sales a major constraint in the growth of their business. EY recently surveyed 530 P&C and life insurance agents to better understand trends, growth strategies and ways in which engagement rules have changed. They were asked about carrier selection, support and perceived value, as well as future growth engines and how they see their role as agents evolving in three to five years.

Four key themes emerged from this survey.

1. The threat of direct-to-consumer and digital business models is driving insurance agents’ desire to use digital and social sales tools.

Agents are concerned with how they fit into the trend of more direct-to-consumer and online insurance models. Most view the market shift to direct-to-consumer and online channels as the major constraint in the growth of their business going forward. Inadequate products, investment in analytics, administration and automation, and speed and quality of access to customer or policy data also are constraining growth.

Agent perceptions of carriers

While carriers begin to explore alternative distribution platforms, agents still believe they add value and want to be actively engaged with the customer. Survey findings reveal that agents who sell commercial insurance understand the most about how they fit into their carrier’s strategy, while those who sell personal lines and life insurance understand the least.

Growth is a major concern

The landscape of consumers is rapidly evolving from “traditionalists” to “technologists.” Millennials are the largest customer group in history -- and a target growth area for most industries, including insurance. Agents indicated that they need different tools and products to meet their needs and to capture this growth. Agents currently value basic functionality (e.g., operations and sales); however, the agent of the future will be concerned more with digital capabilities and tools. Quality of tools plays a large factor in the decision-making process.

See also: How to Support the Agent of the Future  

2. Agents expect carriers to enable simple customer and agent experiences, which, in turn, will drive agent loyalty. 

Today, 90% of agents tap into multiple carriers, which is forcing insurance providers to rethink their value proposition and ability to differentiate. Personal P&C agents are more likely to have two to five most-favored carriers, while those in commercial lines tend to favor one or two carriers for each product. Only 12% have one primary alliance carrier.

Agents need support from carriers

When asked what carriers could do to ease the operational burden on an agency, respondents universally identified better communication, improved customer service and underwriting. Agents think simplicity is the key for carriers to improve the customer experience. Across product types, agents have different opinions of what carriers can do to improve their responsiveness to customer service or claims; 45% want fewer forms and less paperwork, while 35% propose simpler products and better customer online tools.

Better sales tools, technology and analytics

Life agents are more focused on systems that support new leads and better underwriting, representing an opportunity for improvement. While 65% of commercial and P&C agents rate current tools as very good or good, only 45% of life agents rank them as such. The larger the agency, the higher the quality rating.

3. The agent of the future is looking for innovative, customized products to meet changing market and customer demands.

Innovation will require product change

Product innovation will be a key driving factor behind the agent of the future’s expanded basket of products. All agents place significant value on innovation that facilitates new business. Nearly half of commercial agents perceive technology that automatically identifies potential opportunities within their existing book of business as highly important. The majority of agents believe that carriers could be more innovative by producing more simplified products that require less explanation and better address the needs of millennials. Only one third view the needs of Gen-X’ers and baby boomers as the type of product innovation that will help them grow their business.

Wearables and new technology present opportunities

Technology is viewed as an important factor in addressing the needs of a new generation of agents – and adding millennials to the salesforce will better cater to that market. As millennials continue to represent more market share, almost 40% of agents question their preparedness to meet the needs of the next generation.

4. Agents see close collaboration with carriers as driving growth.

Agents want to be more involved in the underwriting process. They agree that carriers could improve underwriting interaction by allowing more access to underwriters, enabling agents to work with the same underwriters and shifting underwriters’ transactional role to a relationship-focused engineer of customer solutions.

Agents seek closer working relationships with carriers

The majority of agents are open to the idea of reducing their role in servicing to focus on sales and growth. Across all product types, nearly half of agents view increased customization as one of the main product changes to address future needs. In line with customization, 40% of agents view the ability to provide many available features to address a wide set of needs as key to meeting evolving market demand.

Improving the agent experience

Strengthening current customer relationships and achieving customer-centricity in core operations have become strategic imperatives. As consumers embrace digital and other emerging technologies, insurers must rethink their distribution strategies, agency interactions and partner relationships.

See also: The New Agent-Customer Relationship  

Conclusion

Listening to the “voice of the agent” can help carriers provide a deeper, more robust experience and support them to rethink their commitment to the agency system. A collaborative process will allow carriers and agents to interact and strengthen their relationship. Our survey supports the concept that insurers and the agent of the future will be stronger by working together.

Technological innovation has the potential to change any industry for the better, and major technological developments in the last decade or so are creating exciting opportunities in insurance. Here are some of the top ways that insurance can leverage digital technological innovation. 1. Advanced Data Collection From wearable technology, to devices you can put in your car to monitor your driving habits, all of these innovations can provide insurance companies with highly useful data for their policyholders. Smartwatches alone can provide a large amount of beneficial data. For example, the Apple watch can track all of the following; heart rate, activity levels, steps taken, calories burned, movement, among others. Technological breakthroughs are making it easier for insurance companies to gather critical data. Being able to access large amounts of data can help insurers to create better policies, identify their lowest-risk policyholders and obtain alerts when policyholders are at risk for certain types of loss. See also: The Key to Digital Innovation Success   2. New Types of Insurance All of the advances in technology have led to many companies becoming increasingly reliant on their tech infrastructures. Also, increased dependence on technology has created a heightened need for data to be protected. Massive losses can be incurred by companies that have their sensitive data breached. The result is that “cyber insurance” is becoming increasingly popular. Almost 10% of companies now have cyber insurance. This number is likely to increase as more insurers begin to offer this type of coverage, and more companies realize that they need it. In fact, within a few years, cyber insurance could be as common as property insurance or liability insurance for businesses. 3. Increased Personalization Many insurtech companies are now making it possible for customers to engage with their insurance companies through various types of apps. These apps allow policyholders to set up profiles and indicate their preferences for service offerings. Customers can even choose to connect with their insurance companies on various social media outlets if they want to. And, because 47% of millennials report being influenced by social media when it comes to making purchases, this is a good thing. Personalization can be beneficial when it comes to improving customer experience, and helping customers to enjoy their interactions with their insurance company. In this sense, mobile innovations are making personalization easier by connecting policyholders with insurers directly on their smartphones. Final Thoughts Technological innovation in insurtech, wearable devices, data, apps, mobile devices, computers and many more areas all have a strong impact on the insurance industry. The time from the start of the new millennium until the present day has brought many of these new technological innovations. Some insurance companies may hesitate to take advantage of new technology because of a fear of change. However, there are incredible opportunities out there. Advanced data collection, new types of insurance and increased personalization are only a few of the ways that insurers can leverage digital technology innovation to become more profitable. See also: ‘Digital’ Needs a Personal Touch   As technology continues to advance, even more opportunities will become available.

Machine learning has been a staple of our consumer-driven economy for some time now. When you buy something on Amazon or watch something on Netflix or even pick up groceries at your local supermarket, the data generated by that transaction is invariably collected, stored, analyzed and acted upon. Machines, no surprise, are perfectly suited to digesting mountains of data, observing our patterns of consumption and creating profiles of our behaviors that help companies better market their goods and services to us. Yet it’s only been in the past few years that machine learning, a.k.a. data mining, a.k.a. artificial intelligence, has been brought to bear on helping companies defend their business networks. See also: Machine Learning: a New Force  

I spoke with Shehzad Merchant, chief technology officer at Gigamon, at the RSA 2017 cybersecurity conference. Gigamon is a Silicon Valley-based supplier of network visibility and traffic-monitoring technology. A few takeaways: Machines vs. humans. There is so much data flowing into business networks that figuring out what’s legit vs. malicious is a daunting task. This trend is unfolding even as the volume of breach attempts remains on a steadily rising curve. It turns out that cyber criminals, too, are using machine learning to boost their attacks. Think about everything arriving in the inboxes of an organization with 500 or 5,000 employees, add in all data depositories and all the business application depositories, plus all support services; that’s where attackers are probing and stealing. Understanding legitimate behaviors. To catch up on the defensive side, companies can turn to machine learning, as well. Machines are suited to assembling detailed profiles of how employees, partners and third-party vendors normally access and use data on a daily basis. It’s not much different than how Amazon, Google and Facebook profile consumers’ online behaviors for commercial purposes. “You have to apply machine learning technologies because there is so much data to assimilate,” Merchant says. Identifying suspicious behaviors. The flip side is that machines can be assigned to do the first-level triaging—seeking out abnormal behaviors. Given the volume of data handling that goes on in a normal workday, no team of humans, much less an individual security analyst, is physically capable of keeping pace. But machines can learn over time how to automatically flag events like a massive file transfer taking place at an unusual time of day and being executed by a party that normally has nothing to do with such transfers. The machine can raise a red flag—and the security analyst can be dispatched to follow up. “We’ve got to level the playing field … today, it’s machine versus humans,” Merchant says. “Organizations have to throw technologies, like machine learning into the mix, to be able to surface these threats and anomalies, so that we take out the bottlenecks.”

The race to put a self-driving car on city streets is starting to look like the space race of half a century ago -- everyone wants to get there first. Germany leads the race, with the U.S. running right on its heels. Japan, Sweden and France are making good strides, as well, while Italy, Korea, England and China run at the tail end of the pack, but, nevertheless, at a swift pace. Regardless of who first crosses the finish line, the very existence of a self-driving race proves that manufacturers and governments worldwide believe that these cars will spearhead some global changes. This is certainly true when it comes to safety. The numbers behind the trend all are truly impressive. Auto Loan Solutions, a car loan company based in Ontario, has created the infographic, “To Drive or Be Driven”, to show what these numbers are telling us about autonomous vehicles. See also: Of Robots, Self-Driving Cars and Insurance   Sure, self-driving alerts may flood your inbox, but the odds of your finding some new stat or insight in this piece is likely -- and, at the pace that the race is occurring, major developments will come in a few short years.

After decades of experience working with and getting to know thousands of people whose job it is to give advice around insurance, investments and real estate, I’ve observed a few traits that I personally believe are critical to long-term relevance. Frankly, I also believe they will make certain advisers immune to the threat of their job being eaten by technology.

There is quite a bit of concern over robo advice threatening these livelihoods. We must consider that the underlying reason is a trust problem with those who make their living giving advice while at the same time selling products for a commission. But the underlying cause of mistrust may actually be the absence of one or more of the following five characteristics of advisers that matter more in the trust equation: 1. They seek to help their community first, then benefit from it later. There’s a not-so-subtle distinction between people who join a community group because they want to network for business purposes and people who join because they are interested in helping advance the mission of that group. While oftentimes both motivations can exist at the same time, the real test would be to ask those people if they would have either joined or stayed with that group even if their prospecting need were not there. While those inside the business may not see the distinction, others can see it a mile away. Trust erodes when intentions are not clear. See also: 3 Major Areas of Opportunity   2. They see work and life as inextricably intertwined and are in love with both. Advisers who will stay relevant, who are "nondisruptable," are people who always seems to be there for what’s most important, whether the market is crashing, an individual lost his/her job or someone’s kid or grandkid is in a little league game. From the outside, it may look like those advisers are either always working or never working. And the answer would be: yes, they are. 3. They keep score based on outcome versus income. While earnings and sales numbers are important for a successful practice, putting numbers on the board is not what makes nondisruptable advisers sleep well at night. Rather, they create metrics of their own, consciously or unconsciously, counting things like how many people they have advised, how many thank you letters they receive, how many people they’ve helped employ or even how many hugs they have ever received from their clients. Counting these means they never need to count sheep. 4. They are described similarly by families, friends, clients and communities. Nondisruptable advisers show one face to everyone. While they may have many interests, they bring their best to every situation and see the role of adviser as a calling and not just a career. Anyone can give advice from his/her own point of view. However, it takes care, skill and emotional intelligence to deliver advice that’s in someone else’s best interests. The question remains as to whether these traits can be taught. Sure, someone could write a book or perhaps create a coaching program around them, but I’m not sure either would help. I suspect that people are either raised in such a way that these traits develop or they experience something dramatic that shifts their perspective quickly and forever changes their attitude. 5. They leave a mark that lives past them. While this trait certainly isn’t realized until the adviser passes away or can no longer do his/her job, that individual’s ability to make an impact is unmistakable and therefore nondisruptable. You just know it when you see it. See also: Insurance Coverage Porn   This article was inspired by and is dedicated to my long-time friend Jane Lopp from Kalispell, Montana. Jane and I met at Prudential, where she built an impressive practice with an outstanding team, a supportive family and a community that felt her presence in countless ways. Nothing stopped Jane, including being confined to a wheelchair due to a muscle disease. Jane’s life was taken after a car accident on April 21 of this year, and, as her husband, Bob, noted, she was full of life and at the peak of her career. If you know someone like Jane who embodies these five traits, please give them a hug. They deserve it.

The emergence of the Internet of Things (IoT), or perhaps more appropriately described, the “Integration of Things.” has created more visibility to the convergence model generally and cyber threats specifically. That said, I see a fundamental problem with sales organizations, outside of the cyber industry, with initiating a cyber discussion. This is the first step in aligning cyber threats in the context of overall business risk, and for providing the managed services, secure products, and insurance coverage that the industry increasingly requires. This Cyber 101 Discussion is more of an informal conversation than a deep technical discussion. Cybersecurity is a confusing topic to many people and is at times assumed to be overly complex. In reality, it is a crime and espionage discussion with a rich history and interesting as a business case study. Put into this context, it is actually a compelling narrative and promotes a lively conversation that inevitably turns to the topic of operational risk and specific business issues. See also: 3 Things on Cyber All Firms Must Know   The first step is to know your cyber history. This does not have to entail a debate as to when and how hacking evolved. I believe an appropriate starting point would be the first Gulf War. Perhaps the 1990s are ancient history for some, but most senior executives can identify. The important fact was the ease at which the U.S. military demonstrated technical dominance over the Iraqi army. Nightly newscasts of American generals proudly showing video clips of guided missiles accurately striking buildings and vehicles was enough to send chills down the spines of our nation state adversaries, and jump start their offensive cyber commands.

“I believe the Chinese concluded from the Desert Storm experience that their counter approach had to be to challenge America's control of the battle space by building capabilities to knock out our satellites and invading our cyber networks. In the name of the defense of China in this new world, the Chinese feel they have to remove that advantage of the U.S. in the event of a war”. – Admiral Mike McConnell (ret.), former Director NSA, and Director National Intelligence

Not to be left out, the Russian military also accelerated its cyber capabilities (post Gulf War I) as well. In fact, many “retired” military cyber warriors established the early Russian cyber criminal syndicates, and promoted global cyber crime as a business model. As a result cyber crime evolved, and Cyber Crime as a Service eventually exploded. It is a well-known operational fact that you only exist as a significant Russian cybercriminal if you abide by three hard and fast rules:

1. You are not allowed to hack anything within the country;
2. If you find anything of interest to the government you share it;
3. When called upon for ‘patriotic cyber activities,’ you serve.

In exchange you are “untouchable” and immune from prosecution. Tom Kellermann, CEO of Strategic Cyber Ventures, is a cyber intelligence expert, author, professor, and leader in the field of cybersecurity serving as a Global Fellow for the Wilson Center. He is the previous Chief Cybersecurity Officer for Trend Micro, and Vice President for Security at Core Security. Tom has mentioned to me that existence of approximately 200 “Cyber Ninja’s” globally; truly elite gifted hackers. This select group of black hat ninja’s realized they could produce “malware for dummies”, (or criminals with average skill sets), along with on- line “how to hack” support services, in return for a cut of the profits. This business model returned more personal revenues at scale, compared to individual hacking activities, with much less risk. These operations created the original “Malware as a Service” business models, and as a result cyber crime has since exploded. According to The Serious Organized Crime Agency (SOCA), global cybercrime has surpassed narcotics trafficking in illicit revenues, and In the United Kingdom, over 50% of all crime is now cyber related. As a final thought Tom added that cybercrime has transitioned from traditional burglary to digital home invasion.

“The economic security of the West is in jeopardy. Civilizing cyberspace must become a national priority.”

Research firm, Cyber Ventures (not to be confused with Strategic Cyber Ventures), produced a report that predicts that cyber crime worldwide will grow from $3 Trillion in 2016 to over $6 TRILLION dollars annually by 2021! As a comparison, the entire Gross Domestic Product (GDP) for the U.S.A. was $14 Trillion in 2016. Cyber crime today is professional, organized, sophisticated, and most importantly “relentless”. These are not personal attacks. If you have any digital footprint you are a target, period. The entire Internet can be scanned for open ports within a few days. When it comes to security, the old adage “Offense informs Defense” is appropriate when protecting your specific business operation. A former client of mine, John Watters, CEO of iSIGHT PARTNERS, (now FireEye), used an example: “A burglar and an assassin can use the same tools and tradecraft to gain entry to a location, but the intent, once inside, is very different. One wants your property, the other wants to kill your family. Prepare yourself accordingly”. Another business challenge moving forward is that the risk of cyber attack is growing. This is a dual-edged sword in many regards. The Internet of Things and the Industrial Internet of Things (IIoT) opens a much wider attack surface of many more devices. However, the operational efficiencies and human productivity advances cannot be denied and will move forward. This situation creates a new reality; essentially cyber threats are morphing from a virtual threat into a physical danger. Matt Rosenquist, Cyber Security Strategist, Intel Security Group, explained in his 2017 ISC WEST Keynote address that the same controls that provide auto assist to parallel park your vehicle can be hacked to force a car (or hundreds of cars) to accelerate to high speeds and turn abruptly, causing fatal accidents. Imagine for a moment what that hack does to that specific automobile manufacturers brand reputation? Would the corporation even hope to survive? Moving forward SECURITY, followed closely by privacy protections, will be at the top of all buying requirements to win business. The bottom line is that cybersecurity, like terrorism or tornados, is about risk management. This is a discussion that owners, management, and boards of directors know well. It is the responsibility of the sales professional to educate prospects to the sophisticated level of cyber risk that exists today and into the future. This is why understanding and explaining the evolving cyber crime business model is so important as an initial discussion. See also: Now Is the Time for Cyber to Take Off   In 2017 I have had the “Cyber 101 Discussion” with sales leadership and executives from many companies and industries:

1. The regional insurance firm in Texas (1,000 employees) that recognizes a huge and expanding cyber insurance market opportunity generating over $3.5 Billion dollars in 2016, and growing at 70% annually! Yet their sales organization does not know the first thing about starting the cyber dialogue with potential clients. ‘We know insurance, not cybersecurity”
2. The global video camera distributor that needs assistance in aligning marketing and sales messaging to answer customer concerns about cyber security. The industry needs a response to the Mirai botnet attacks that virtually guarantee that the Internet will be flooded by hacks of new botnets powered by insecure routers, IP Cameras, digital video recorders, and other easily hackable devices:
3. The physical security integrator that recognizes the need to provide secure solutions and endpoints for their enterprise customers, but needs to provide internal cyber education, while recruiting strategic partners offering cyber solutions and support resources.
4. The domestic security monitoring company that now offers cyber managed solutions to SMB market, but struggles with positioning a compelling R.O.I. (Return on Investment), and explains that customers cannot “quantify” the cyber risk to their business? (HINT: That’s the job of your sales organization, your customers need cyber education)

It begins with a cyber sales comfort level within your own organization. Cyber education allows you to pass knowledge on to others as a trusted adviser. Get the Cyber 101 Discussion started as a first step. Whether providing cyber insurance, hardening physical security equipment, or selling secure managed services, the cyber 101 discussion starts with understanding cyber history and the evolution of adversary intent. Today’s cyber threat is a component in the new definition of digital business risk. Position accordingly.

The insurance industry is expected to converge soon. It is an inevitable reality. The question is how quickly such convergence likely to happen? The answer is soon. Definitely within a decade. And needless to say, customers are going to drive the next wave of convergence for the insurance industry. The insurance industry must examine the convergence journey of banking industry closely. Today, banks offer varied converged portfolio of products for customers. It ranges from various account types, deposit and savings products, range of loans, various cards, investments, portfolio services to numerous products as per need of customers. The question is: if today, insurance buyers shop for P&C, life and health insurance products for their needs at different places, why such insurance is not readily available in a converged manner? This is definitely a big opportunity for the insurance industry. Insurers that already possess licenses for different insurance segments, must leapfrog in offering converged insurance products for competitive advantage. Market and Product alignment: P&C, Life and Healthcare industry Insurance industry traditionally has been operating differently for property and casualty (P&C), Life and Healthcare segments. It followed such industry alignment as per needs of various buyers since its formation time and historically such alignment continued over decades with minor tweaks as per market demand. The regulatory frameworks were built around an industry structure to protect the interest of buyers and encourage healthy competitions in the marketplace. Today, the insurance industry has reached the multi trillion dollar in size globally and it is one of the key contributors for every economy serving billions of people in the world. Although there a few handful insurance companies that offer personal, life, annuities, disability, health and other range of insurance products for its customers, such products are typically sold either as separate policies or different business lines under a different legal entity or divisions in a fragmented manner. The overall market is fragmented today in terms of serving the customer holistically. And this is a great opportunity for the insurance industry in offering converged insurance to its buyers. See also: Model for Collaboration and Convergence   Why worry about it now? It is an opportunity that cannot be ignored! Today, every individual or corporate buyer cares for the insurance. It is different thing that many lack understanding of insurance products, few find them too complex to understand and many think companies are not selling or offering the right products for their needs. However, this issue is more related to customer education or awareness and can be addressed. It is very likely that within a family or household, you may find a minimum of 3 or more different policies for personal, life insurance and healthcare needs that are purchased from different insurance companies. This is definitely a missed opportunity for many insurance companies and shows the poor state of the industry in not serving the customer holistically for their basic insurance needs. The question is not about whether the buyer understand insurance or not, but more about whether insurance companies offer adequate products catering to common/generic needs of buyers. Few people may cite regulatory hurdle, licensing challenges, underwriting/actuarial complexities and operating models as potential bottlenecks in adoption of converged insurance, however such doubts may become irrelevant in case the market start maturing or your competitor’s starts moving in that direction or customers start demanding such converged insurance. It is the time to assess the demand holistically, assess market future demand and measure customer feedback and inputs. Product bundling as a strategy is certainly good for competitive advantage Within a household, if we assess the personal lines insurance products that are purchased, one may mostly find that auto insurance is being bought from one insurance company, homeowners from another and travel insurance from different insurance company. The product bundling is a good opportunity not just within a segment (e.g. Personal insurance within P&C) but it makes more sense to bundle products across various insurance segments (e.g. P&C, Life, Healthcare) to serve the customer needs. And there are many successful companies today, who have been doing it with very positive results consistently. State Farm, Progressive, Liberty Mutual are a few good examples who have attained market leadership position in personal insurance in the United States by offering bundled Auto and home products for its customers for quite some time. Nationwide Insurance has been helping customers with bundling Auto, Life and Home products. Similarly, there many other leading brands globally who have been benefitting from product bundling. For example, in the UK, the market leader Aviva is the first mover this year (2017) in offering the converged insurance and made a formal commitment by merging its General, Life and Health insurance business units across the organization to offer simple, convenient and improved value service to its customers. The shift towards converged insurance is just starting in the marketplace and not very far to hit the industry in a big way. Convergence of products is becoming more critical in today’s digital age In today’s digital age, customers are inclined towards digital products that can be purchased seamlessly with ease with some initial research. If the brand is strong and insurance product(s) offer adequate value at affordable price, customers mostly would prefer to buy it from the same insurance company. The days are not very far when many insurers will adopt “one-stop-shop” strategy for serving customer in the new digital age by offering converged insurance products. It is the right time for insurance companies to start preparing for the new converged world, develop cross functional capabilities, identify changes required in processes, operating model and develop platforms that caters to the needs of the new digital world. Emerging Technologies definitely play a critical role in shaping the new converged digital ecosystem. It also offers an opportunity for IT players, software vendors and insurtech companies develop fit for purpose solutions that can address the need of the new digital and converged insurance economy. See also: Convergence: Insurance in 2017   Avoid market distractions: Focus on core capabilities and customer Centricity Many insurance companies today are concerned about the disruptions in the industry. The influence of emerging technologies, insurtech and sluggish growth are adding to the anxiety of insurers globally. While many insurers are focusing on digital themes today trying to keep pace with digital technologies, few are unknowingly tilting themselves away from their focus for core capabilities. Underwriting, risk management, claims management and customer Service are the core capabilities of any insurance company and they must continually refine, invest and improve these areas irrespective of the state or direction of technologies for its competitive advantage and market leadership. The technology investments and core capabilities, investment must be detached. Any trade off here is harmful in the long term for insurance companies. In today’s digital age, convergence of insurance is an opportunity for insurers to address the fragmented products and services landscape. Convergence of insurance is inevitable. The market shifts had just started and customer will drive the next wave of convergence for the insurance industry. Are you ready to be part of the industrial transformation? It is right time to think about it as a long term business strategy and distinctive tool for competitive advantage.

In a recent New York Times story, New Gene Test Poses Threat to Insurers, reporter Gina Kolata describes how data transparency and availability are disrupting underwriting for long-term-care insurance. Kolata discusses how this product, challenged for years by inaccurate claims forecasting and sky-high pricing, faces further threat of adverse selection -- as a consequence of innovation. The article highlights challenges that have potential to affect other insurance lines, as well. Carriers should take note. Companies like 23andme create data asymmetry between a policy buyer and the carrier, with the advantage flipped from the historical norm, where the carrier had the upper hand. With a $199 investment, all of us can now make more informed decisions about which risk pools we may fall into based on the odds, at some point in our lives, of being afflicted by one of 10 diseases covered so far (the company has regulatory support to expand its offering). The availability of predictive insights into future medical conditions at an affordable retail price signals that we are entering a world where we will be able to prioritize, with more knowledge than ever before available, where to put our insurance premium dollars. We will have more data to assess which risk pools are worth joining. See also: 3 Key Steps for Predictive Analytics   This is one more development overturning the business model for life, health and other products. $199 is a good deal when deciding whether to purchase a policy that might cost thousands of dollars in annual premium. The two million people who have already purchased a test kit would likely agree. Usage-based insurance (UBI) products, such as those offered by Metromile, Progressive and Allstate surface knowledge about an individual that helps the carrier with more precise underwriting, allowing the tailoring of a policy to an individual’s driving behavior. UBI also disrupts traditional risk pool principles. And, it is hard to imagine that UBI won’t hurt those with less favorable profiles. The full consequences to society may not be examined or understood until out into the future, but they are brewing. The 23andme model exploits personalized data, but from the opposite direction. It puts personalized data in the hands of the individual, off limits from the carrier. The power shifts to the individual, and, because he is under no obligation to share what he knows, now the carrier faces a greater disadvantage. Carriers can withdraw from markets, skim the beset customers or advocate for the creation of high-risk pools. Let's hope the insurance sector will also look itself in the mirror and recommit to its purpose as it relates to making it possible for a community to pool resources to protect individuals in an hour of need. The question is: Will insurers find a path to sustain their purpose under rewritten assumptions? The floodgates demanding reinvention are open. Any insurance player who thinks "this too will pass" or regulations will provide protection may be able to buy time for a while. But chances are his business is already being affected by what data is available to whom and when, by what will be growing data asymmetry working against the traditional insurance model and necessitate a redefinition of how to create and manage risk pools. Back in the 1990s, businesses began to recognize that the World Wide Web would change the way companies across all sectors engaged with everyone -- customers, employees, vendors and all of their other constituents. The notion of individuals, not companies, having greater control over what products and services they chose to buy and use was new. For those of us who were at least young adults at the time, the impact of anyone with connectivity gaining access to information via an act as simple as typing a query into the Google search bar took a while to digest. The insurance sector is a self-confessed laggard when it comes to internalizing and getting out in front of the implications of the Internet. The underlying business model has been relatively stable for a long time. There is evidence of risk pools going back 5,000 years, when shippers devised pools to protect against loss of cargo and crew at sea. The sheer complexity of managing an insurance business made it of lower interest to startups, at least until the last couple of years. See also: Let’s Get Rid of Risk Altogether!   Certainly while insurance companies have introduced countless products, brands have come and gone, and distribution, sales, regulation, automation and every other aspect of the business has evolved, the basics have not changed – the creation and management of a risk pool that is sufficiently durable to pay claims over time, and engagement of a broad community of individuals to feel that their interests are served by participating. Typically, over the summer, companies on a fiscal calendar year engage in strategic planning processes where leaders take a look out into the future and project the implications of big trends on their long-term financial outlook. It’s a good time to take out a white piece of paper and consider:

• Recommitting to their purpose as players in the insurance ecosystem
• Acknowledging what is different, and how to see threat as opportunity
• Prototyping alternative business models, including product, client interaction, distribution, servicing, underwriting and claims management – in other words, the major operating levers of the business
• Engaging in serious experimentation to chart paths that are feasible given the changes that are no longer theoretical – they are here.

May is Mental Health Month! Across the world, many companies are highlighting mental wellness, mental health condition awareness and recovery. Over the past 25 years, I have been helping organizations create effective mental health campaigns, and here are 10 tips I’ve learned and resources I’ve discovered to help your mental health awareness campaigns be most successful. 1. Normalize struggle safely One goal for many mental health campaigns is to let people know they are not alone. When mental illnesses and suicidal crises strike, people often suffer in silence. By letting people know that others have lived through similar challenges, campaigns can offer hope and community. Pain shared is pain lessened. The trap that some mental health campaigns fall into, however, is overemphasizing the prevalence of extreme behaviors as an “epidemic.” This type of messaging can make people feel hopeless about change. Worse, when it comes to suicide, this type of exaggeration might even create a cultural script that inadvertently influences people to engage in suicidal behavior, because it is the "norm" of what people do to cope with pain. Following the safe messaging guidelines helps ensure that the messages they are sending are promoting health and not creating additional risk.

• Positive example: “Each Mind Matters”
• National Action Alliance Safe Messaging Framework

2. Offer screening tools that lead to action Screening is a great example of a low-cost, high-impact tool to highlight during mental health campaigns. As with other health issues, screening for mental health conditions increases the likelihood that we can identify emerging symptoms and alter their course with early intervention. Screening offers people a way to anonymously self-assess, which is often an attractive first step for those who are ambivalent about seeking help. A screening that just gives participant a label, however, will fall short. Effective screening tools give participants a call to action and link them to additional local and on-line resources. Many on-line and paper screening options exist (e.g., Screening for Mental Health), and nationally recognized days can make screening a part of a community’s regular health programming:

• Special screening day initiatives

See also: New Approach to Mental Health   3. Know your resources on a first-person basis Effective mental health campaign leaders do their homework. If you want to be a trusted referral source, you need to walk your talk. Get to know your local mental health providers. Visit your local psychiatric hospital. Invite local counselors to a “meet and greet” event. Call your local crisis line, text the Crisis Text Line or contact your EAP (employee assistance program) to get a better sense of how it works. Ask the questions you need to have answered so you can refer people confidently. Your referral will be so much stronger if you can say, “Oh, I know Dr. So-n-so, she’s really approachable and competent. I’ll take you there to meet her if you’d like.”

• Need more information about EAPs? Here is a buyer’s guide:

4. Share stories of hope and recovery A main goal of many mental health campaigns is to reduce the stigma of mental illness; however, paradoxically, the more we talk about stigma, the more we actually reinforce it. Instead, we can fight stigma by sharing stories of hope and recovery. When we can demonstrate how others transform their wounds into sources of power, we create hope. When respected people come forward and say, “I suffered, and I got better,” others feel they can get better, too, and the issues become less marginalized. When campaigns highlight the experience of living with a mental health condition, focus on the turning points, the coping and resilience and the interventions that worked. One powerful storytelling resource that models best practices in safe and effective testimonies is the photojournalism of Dese’Rae Stage. Her project “Live through This” is an anthology of portraits and interviews of people who have lived through their own suicide attempt. Dese’Rae’s story and project are highlighted in a new documentary just released in April 2017 called “The S Word.”

• Live through This
• The S Word

5. Make messaging attractive, compelling -- and even fun What attracts us to advertising? Messages that make us laugh, catch us off guard or inspire us. It’s human nature to turn away from things that are scary, confusing and depressing. The challenge for mental health campaigns is to make messaging uplifting, engaging and compelling without becoming so superficial they miss the point. Here are some examples of messages on the mark and one example of what not to do:

• Stop using “head-in-hands” despair imagery
• Michael Irvin “To My Brothers” video for the NFL Lifeline
• Man Therapy – a mental health campaign for men that uses humor to get results: www.ManTherapy.org

6. Tell people what you want them to remember Sometimes, in our attempt to get attention to our cause, we play up tragic outcomes and overlook important calls to action and messages of hope. We need to tell people what we want them to remember: Treatment works, prevention is possible and people recover. Let people know what to do if they are struggling or if they are worried about a friend or loved one. Tell people exactly how to get involved in suicide prevention in their communities.

• More tips on creating an action-oriented, positive narrative

7. Engage leadership Often, mental health campaigns gain momentum at the grassroots level – passionate families, students or faith community members come together and apply their collective energy to make changes. “Grass-top” approaches should also be considered to augment this strategy. People in positions of influence can often move things along more quickly and usually just need to know that people care about an issue. So, engage your leaders to start the conversation. Ask them to speak publicly on why mental health matters to them, why it’s an important health and safety topic for your workplace and how mental health challenges have shown up in their own lives. If they have experienced a mental health condition including depression, addiction or overwhelming stress themselves and have received any form of support that was helpful, their “lived experience” is often the most important driving force in changing culture within a company. By sharing their vulnerability and positioning their story as overcoming hardship by reaching out, they model for the rest that “we are all touched by this, and we can get through it together. I’ve got your back and will persist with you to get you the help you deserve.”

• Leadership messaging examples and tips from the National Action Alliance for Suicide Prevention’s Workplace Task Force

See also: Language and Mental Health (Part 3)   8. Provide opportunities for deep learning Many mental health promotion efforts seek to promote awareness, but education alone will not move the needle. We call it the “State Trooper Effect.” We pay attention to educational or awareness raising efforts when they are done well and right in front of us, but once they are in our rear view mirror we tend to go back to what we were doing before. Deep learning goes beyond passive input of knowledge. Deep learning engages people in a knowing-being-doing process. Yes, education is part of that equation – a necessary, but not sufficient piece. We also need to get people “doing” – physically, emotionally and even spiritually involved in the work, and, to really make it stick, personal reflection on the experience is key. One example of “learning, being, doing” is Project Helping – a corporate, positive psychology engagement program that gets people engaged in actions that create a caring culture at work. 9. Create a symbol of solidarity We’ve seen how the color pink has symbolized breast cancer awareness. Symbols of solidarity work, but they need to be unique. When these symbols work well, people can see at a glance the community that is being built. Symbols used to promote suicide prevention can let people who are struggling know who might be a safe person to approach with questions. When the symbol of solidarity starts to spread to large groups of people it is a powerful testament to a person secretly in despair. Some examples of symbols of solidarity include: [caption id="attachment_25940" align="alignnone" width="318"] Photo by Joits[/caption]

• “Honor bead” necklaces worn at the American Foundation for Suicide Prevention’s Out of Darkness Walk. Participants choose to wear different colors to symbolize their experience – one color represents “I have lost a loved one to suicide,” another color might mean “I have struggled myself,” while another says that “I support the cause of suicide prevention.”

10. Promote belonging and purpose Thomas Joiner’s model of suicide risk tells us that a thwarted feeling of belonging and a perception of being a burden are two critical factors that increase a desire for suicide; the opposites of these states are belonging and purpose. When we create meaningful communities and let people know they are needed, we are doing suicide prevention. How can your mental health campaign help people connect to one another and find a new or renewed sense of purpose? How can people “pay kindness forward” and develop trusting relationships with one another? Conclusion Mental health awareness campaigns need to go beyond “awareness raising.” They need to do more than just share statistics and the local resources’ contact information. Promising campaigns model hope, inspire creatively, practice safe messaging and call us to action. The campaigns that are most effective go well beyond any awareness day, week or month and are “baked in” to a company’s health and safety culture. The ones that are truly culture-changing are “by, about and for” the people within the company; real employees telling real stories of hope and recovery. When we realize we have a secret we all share, the walls come down and we heal together.

Automating risk management, rating, quoting and renewals, integrating massive disparate legacy systems and redefining age-old business models – essentially all at once – is no small task. But it offers progressive insurers great opportunities to vault past the competition It seems as if almost overnight emerging insurance technologies have flooded the market under the rubric of insurtech. Of course, this isn’t quite how it happened. This shift in insurance, evolving over decades, has seen a rush largely due to the emergence of agile disruptors recognizing the need for digitization and automation in a market previously slow to change. The innovations have been fast and furious, but according to a recent Celent report, Life Insurance CIO: Pressures and Priorities 2017, insurance IT departments are still relatively slow to make innovation a top priority. Only 14% of carriers pursuing innovation say it will have a significant impact on IT spending. Some 71% report a moderate impact, and 14% say none at all. Nevertheless, as disruptive forces increase, traditional insurers will have to respond. See also: Preparing for Future Disruption… Take peer-to-peer insurance. This new model first appeared in 2010 when a German company, Friendsurance, decided to offer products that promote transparency. Its pricing reflects the number of claims recently submitted. Consider Lemonade—the insurance outfit, not the drink. It offers personal insurance to New Yorkers, boasting, “Maya, our charming artificial intelligence bot will craft the perfect insurance for you. It couldn’t be easier, or faster.” There’s even a charitable angle: “We take a flat fee, pay claims super-fast and give back what’s left to causes you care about.” New approaches such as Friendsurance and Lemonade are creating customer-centric models that could garner attention from consumers and may have the potential to change insurance dramatically. Driverless cars, enabled by Internet of Things technology such as sensors, will affect the way cars are insured. Google and Uber are already investing in fleets of self-driving vehicles, but, with few on the road as of yet, the extent to which safety has improved hasn’t been determined. But it is clear is that claims previously resulting from human error would likely no longer apply. The car manufacturer, not the driver, would be liable. If this happens, drivers can expect lower insurance premiums but may see higher prices or built-in fees for autonomous cars to reflect the transfer of risk from the driver to the manufacturer. Digital business tools such as electronic signatures are already having a big impact. The technology allows for the creation and transfer of secure signatures over networks via computers, tablets and smartphones. It can support completing an application or policy in one transaction. E-signatures improve workflow for the broker as well as the customer’s experience. Now brokers and customers can finalize transactions from anywhere at their convenience and eliminate the manual tasks of printing, scanning, faxing and emailing documents. Electronic signatures also help reduce risk by providing audit trails and ensuring all documents that necessitate a signature are in order. Benefits include lower costs, fewer errors and more streamlined processes. Regulations in some states limit the use of e-signatures, however. See also: Which to Choose: Innovation, Disruption?   These innovations are creating entirely new ways for insurance providers to reach and retain customers, and it’s only just beginning. Today, continuous innovation is just as important for insurers as the traditional disciplines of underwriting, financial management, marketing and customer service.