Last year, as Airbnb’s $25.5 billion valuation surpassed Hilton Hotels' and Uber became the world’s most valuable privately owned company, it became clear the on-demand economy is no passing fad but is, in fact, a force to be reckoned with. The on-demand marketplace is growing at a dizzying pace as new companies emerge daily, helping connect a diverse workforce of tradespeople, licensed professionals and unskilled laborers to a market of willing buyers through the company's platforms. Intuit projects the population of U.S. on-demand workers will more than double by 2020, which means that, if you can’t already summon a doctor, lawyer, babysitter or dog walker right now via an on-demand app, then sit tight—they’re coming soon to a smartphone near you. But the scale and speed of the on-demand economy’s growth also means policymakers, regulators, insurers and on-demand companies will have to huddle quickly to resolve the issues that arise with this expanding marketplace and its workforce. Here are the three key questions we need to address immediately:

1. When the safeguards of the traditional corporation no longer exist, how do we protect the on-demand workforce?

Uber is currently appealing a case it lost against the California Labor Commissioner last summer regarding whether a driver is an independent contractor or an employee. While establishing this distinction is a critical issue, we still need to address some big questions about the vast self-employed workforce in the on-demand economy. A good primer question: How do we get the information we need to make informed policy decisions? Independent contractors in the on-demand economy are classified as part of a larger pool of temporary, seasonal, part-time and freelance workforce called “contingent” workers. A 2015 U.S. Government Accountability Office report cites this workforce as somewhere between less than 5% and more than one-third of the country's overall labor pool. The big gap in this measurement is because it depends on how jobs are defined and on the data source; the broad definitions and lack of clear data on this workforce makes on-demand independent contractors and their needs tough to track and evaluate. How much of this workforce depends on this income for supplementary purposes as opposed to relying on this income as a full-time living? According to Intuit’s study, contingent workers will make up 40% of the U.S. workforce by 2020. That’s a lot of people working without the safeguards provided by the traditional corporation—guaranteed minimum wage, steady income, unemployment insurance, healthcare, workers' compensation and disability insurance. What kind of safety nets do we need to put in place to protect this workforce? And what does this growing workforce mean in terms of policy development? How does the social contract change?

2. How should we regulate hybrid commercial/consumer activities?

A sticky issue surrounding the on-demand economy is how to regulate commercial activities that are conducted by individuals rather than by traditional businesses. While some argue that an Airbnb property should be as heavily regulated as a hotel if a host is accepting payment for lodgings, drawing an apples-to-apples comparison between the two is a challenge. For example, treehouses, yurts, igloos and lighthouses were among the top-10 most desirable vacation destinations on Airbnb shopper’s wish lists last year, some fetching upward of $350 a night. Who exactly should you call about making sure the igloo is up to code before guests arrive? Some of the services and products offered by the individual through on-demand platforms have never been available through traditional enterprises; they’re unique, intimate experiences and, before on-demand platforms made them accessible, were difficult to find. We’re entering a new frontier where many tourists covet a culinary experience they can book at a local’s house via apps such as Feastly or Kitchensurfing rather than a fine dining restaurant, or they prefer offbeat accommodations booked through Airbnb to a 5-star hotel. We can’t assess how to best regulate these individual commercial activities until we have more data and understand the risks. How do we collect that data? How do we ensure the safety and protection of the individuals operating and participating in these activities until we have the information necessary to adequately regulate them?

3. How can a square peg workforce function in a round hole system?

Mortgages, loans, credit cards, leases … these are just a few of life’s niceties (or necessities) that are challenging for an on-demand independent contractor to secure. Our current financial services, systems and policies were built to work for employees who collect a regular paycheck as well as freelancers who have reliable cash flow through long-term contracts and monthly retainers. Independent contractors working through on-demand platforms tend to rely on short-term gigs often generated through multiple sources, and they have difficulty predicting their day-to-day income, never mind their annual net or gross. This isn’t a niche workforce. If independent contractors represent 40% of the U.S. working population in 2020, they’re significant drivers of the economy. They generate income and pay taxes; they need homes, cars, work equipment and all the other stuff that keeps their businesses running and makes their lives worth living. We can’t dismiss their needs, because we are measuring their 21st century income with a 20th century yardstick. How do we retrofit our round-hole systems to include this square peg workforce? If we want a thriving economy in which people enjoy the benefits of the on-demand economy, and doctors, lawyers, drivers, plumbers and everyone else serving the on-demand marketplace have equal opportunity to succeed, then the time to talk about these questions and issues is now.

Cargill, Monsanto, Wells Fargo and John Deere are officially out of the crop insurance business, according to a recent article from Bloomberg. Large companies like these expanded into different aspects of the agriculture industry over the past few years, and their debut in the insurance industry made quite an impact. With their newly acquired insurance operations, they were the market players to watch – and now we’re watching them leave the industry. Behind this exodus is the matter of profit. Large companies, especially those that are publicly traded like Monsanto and John Deere, have a different perspective on risk and profit than the typical insurer. Let’s take crop insurance profit and loss over the past couple years, which is driven by fluctuations in crop prices. As Bloomberg explained, “Bumper harvests have sent corn, the biggest U.S. crop, to less than half its 2012 peak, ratcheting down the premiums farmers pay to insure against loss. Other crops have also seen steep price declines.” At the same time, the broader insurance industry has been seeing lackluster results. The most recent numbers from the Congressional Research Service indicate an underwriting loss of $1.3 billion in 2012 and profit of $657 million in 2013. For insurers, although these are not welcome results, the reality is that there will be challenging years – and insurers are accustomed to anticipating them. They are in for the long haul. But large, diversified commercial companies such as Cargill, John Deere and Monsanto have a much harder time adjusting to these financial results. So, were these big external players a collective blip on the map, or a real disruption? A pattern visible across many industries offers a possible answer. Large companies diversify around their current offerings, and, if the results are disappointing, they realize the expanded offerings are not core to their business. Google has been extremely successful in most of its diversification, but Google+, its social network offering, never became the powerhouse the compay had hoped would challenge Facebook. If these large companies are unsuccessful, they often leave the new industry. This is not to downplay the role that new entrants have in the insurance ecosystem. They push our thinking and ways of doing business in directions that might otherwise have taken years for the industry to adopt. New players like Haven Life and Google are not attempting to be the same old insurer, only better. Their goal is to disrupt the business of insurance and to create something in a niche that the industry had not perceived. The disruption they cause can take many forms, from new solutions to new distribution channels. They can go after these markets without owning the entire process – and, in doing so, they create real changes in how the insurance industry has to operate. Driverless cars will present similar challenges. Volvo and Ford have both mentioned the possibility of covering product liability insurance. How will this affect the insurance industry? Will automakers really cover the liability, or will they front it? Autonomous vehicles will change the insurance landscape by opening doors for these new thinkers. But will the insurance industry need to step in to present new insurance products that provide the necessary coverage? What role will insurers play in the new auto world? Disrupters like Monsanto, Cargill and John Deere were not in the market for a long time, but they do have an impact. They invested in changing the claims process, and they applied data, analytics and automation in areas that were previously very manual – which causes us to rethink other processes. We can hope that their new ways of doing business opened some eyes in the industry. They did not change the game so much as establish that the game needs to be changed.

One of the common challenges insurance companies face when it comes to claims is how they can make the process more efficient for customers. Processing claims takes time and resources regardless of size, especially for claims valued at $10,000 or less, where it is not cost-effective to have an adjuster evaluate the damage onsite. Mobile changes customer expectations  Customers' today are demanding. They want instant results. Mobile technology is transforming customer expectations. Nigel Walsh, who is the head of insurance in the UK for CapGemini, stated at a recent TechUK meeting that. “Customers are getting more savvy. Expectations have gone up, but insurers are not meeting those expectations.” Traditional claim processes meet disruptive technology Using technology to engage with the customer, the InsurTech transformation is addressing the gap between self-serve applications and traditional onsite visits with video. Solutions such as SightCall Visual Claims are using mobile video to allow policyholders to file claims in real time. It is all about the customer using technology that engages them and allows them to show the damage with their smartphone. Here is a quick example of how it works. Don’t fall short of customer expectations. They are ready While starting in early stages of implementation, major insurance companies were only expecting 10% of their customers to accept this new approach. Instead, they reported receiving more than 80% positive participation. The mobile mind definitely shifted the expectation that “I can get what I want immediately.” Providing an instantaneous solution to customers has become essential in how successful insurance companies distinguish their value from the competition. Is insurance ready? Reducing claim cycle times from days to hours not only results in high customer satisfaction but also creates massive savings. The monthly cost of the technology can usually be covered by one single video session that avoids an onsite visit. Decision is a no brainer. Now the challenge resides in the change management. Insurance customers are ready, but are insurance employees ready to change their way of working?

We all know the current healthcare system in the U.S. delivers erratic quality at unsustainable, yet ever-increasing, costs. Workers’ compensation medical care is affected by those costs.  A major shift in the health industry, value-based healthcare, will benefit workers’ compensation. Embracing selected new medical management methodologies put forth in value-based healthcare has the potential to be powerful. Value-based healthcare means restructuring how medical care is organized, measured and reimbursed. It moves away from a supply-driven system organized around what physicians do to a patient-centered system organized around what patients need. The focus is shifted from volume and profitability to patient outcomes (quality care). When fully implemented, the overall impact will be nothing less than staggering. Porter and Lee, healthcare industry strategists at Harvard, have described six value strategies necessary to achieve healthcare industry transformation. Many of the changes are now underway in ACOs (accountable care organizations) such as the Cleveland Clinic, proving the concept. These defined initiatives produce desired results—quality care at less cost.  Six components of value-based healthcare The following briefly describes the methodologies necessary to transform healthcare, according to Porter and Lee.

1. Integrated practice units (IPUs)—meaning multiple specialists practice together, resulting in comprehensive and integrated medical care rather than fragmented, duplicated services

2. Measure true outcomes and costs for every patient--When outcomes are measured and reported publicly, providers are under pressure to improve. Fraud and self-dealing are reduced.

3. Bundled payments--Payment bundles are capitated single payments for all the patient’s needs during defined episodes of care, such as specific surgical procedures. Providers are rewarded for delivering quality while spending less.

4. Integrate care delivery systems--Services are concentrated and integrated to eliminate fragmentation and to optimize the quality of care delivered at any given location.

5.  Expand geographic reach--Centers of excellence are developed where expertise is gained through higher volume of similar procedures.

6.   Information technology--Data mining powerfully enables the first five initiatives and informs services and decisions.

As Porter and Lee say, “Whether providers like it or not, healthcare is evolving from a proficiency-based art to a data-driven science, from freelance physicians to hospital-employed physicians, from one-size-fits-all community hospitals to vast hospital networks organized around centers of excellence.” Value-based medical management in workers’ comp The goal of value-based medical care is to enhance quality outcomes for patients (injured workers) while reducing costs. Focusing on quality (what the patient needs) actually reduces costs. For group health, the measures are physical and philosophical, requiring widespread disruption in how services are organized, delivered and reimbursed. However, workers’ compensation payers can benefit by incorporating three of the six value measures into their medical management process now.

2. Measure true outcomes and costs for every patient (the injured worker)

Physician performance is scored based on injured workers’ experience and outcomes along with cost. Providers who score poorly can be avoided.

3. Bundle payments

Bundling is capitating payments for all the services required for procedures such as specific surgical procedures, including all associated pre-op and post-op care. The costs are kept in line because providers need to stay under the cap to be profitable. They also focus on quality, because re-dos, redundancy and complications add cost to the service bundle, thereby diminishing profits. Prepare to see bundled payment options available to workers’ compensation sooner rather than later.

6. Information technology

The data in workers’ compensation, while in silos, is all organized around individual claims and injured workers. When the data is integrated at the claim level, patient experience, provider performance, outcome and cost analysis opportunities are unlimited. The more comprehensive and accurate the data, the greater the opportunity for gain. Those who cling to traditional seat-of-the-pants medical management will be left behind. Those in group health may be hampered by slow regulatory change, organizational upheaval and resistant providers, while workers’ compensation payers are free to adopt transformative value measures now. Organizations that progress rapidly to implement the value agenda will reap huge benefits.

"Insurance Marketing & Distribution Summit Europe 2015" proved to be a great event. There were interesting speakers, a range of topics and plenty of opportunity for interaction. Plus, it was a pleasure for me to share with this group, but more on that later. Following events that were useful for getting close to leaders on whom insight leaders focus less (IT, digital, customer experience), I was back with marketing  and sales. Most likely, the primary customer for most insurance insight teams is their marketing leader. So, I hope it's helpful to hear the thoughts and plans of a number of leaders from the insurance marketing community. Here are key messages from these insurance marketers:

• Marco Brandt (Agila) shared about Agila's journey from being a broker-based pet insurer to focusing on the Internet channel. It uses digital capabilities for personalization of communication and pricing. Perhaps the biggest opportunity for the company, though, was to use its digital communication and free content to dramatically increase the number of touch-points with their customers (a recurring theme). Agila has a strong story to tell about growth of customer satisfaction and premium income (which doubled in five years). The company's next, self-identified challenge is to embrace mobile.
• Stephan Dequaire (Towergate) provided a review of the growth of price comparison sites in the UK car insurance industry. I was surprised at how much Compare the Market now dominates, above even MSM and Go Compare. It was also interesting to see how much this model varies across the world. By comparison with the U.S., intermediaries (including tied agents) are more the norm across Europe, where there is also a larger share for bancassurers. Some research suggests the shine is coming off them, though, with even consumer advice sites pointing to direct insurers. What was more shocking was to hear how a consumer advice site suggests consumers lie about data to get a better price ("optimizing your job title," etc). It really brought home the erosion of consumer trust, in the UK market especially.
• Phil Bayles (Aviva) reminded us that, across Aviva and insurance as a whole, the intermediary channel still provides the largest profit and volume. He provided a nice segue into my later talk because he stressed how more than 25% of management time was now taken up by conduct risk agenda. The challenge with succeeding with your intermediary channel, including independent financial advisers (IFAs), is that they deal with you day in and day out. You can't persuade an intermediary channel with some catchy or emotive brand advertising. Bayles stressed the need for a focus on adviser satisfaction and ease as well as fixing problems quickly. With a strategy to be "No. 1 for Brokers," there is nowhere for Aviva to hide if tracking does not match up. Transactional net promoter scores (TNPS) suggest that Aviva is well on its way.
• Simon Green (The FCA) talked about how FCA's behavioral economics expertise was influencing policy and reviews, as well as the important role of technology innovation.
• Pollyanna Deane (Simmons & Simmons) brought legal expertise to our proceedings and talked about increasing regulatory scrutiny, including the likely impact of the Insurance Distribution Directive. She also mentioned the risk of European Insurance & Occupational Pensions Authority (EIOPA) becoming a third regulator for UK insurers!
• I then presented on customer insight and conduct risk, where I shared a number of the lessons I've learned from training insurance marketing teams on using customer insight to mitigate conduct risk. This included briefly covering consumer spotlight, behavioral economics and vulnerable customers. I'm pleased to say there was considerable interest afterward as marketing leaders could see the benefits of more focus on conduct and on embedding insight in their processes.
• Louis de Broglie (InsPeer) focused on innovation. He explained the interesting concept on which his start-up, InsPeer, is based. Returning to the insurance origin of mutuality and governance in community, his company provides consumers with a way to pool their excesses. Currently, only available in France, this unregulated solution combines the purchase of high-excess cover from an insurer with a community that contracts to cover a proportion of others' excess in the event of a claim. This results in lower premium and zero excess for each individual, as well as social pressure on claim veracity and lower claims frequency for the insurer. The next stage is intended to be peer-to-peer insurance, akin to the evolving models from Guevara in the UK, as well as others worldwide. Given the explosive growth of Uber and AirBnb, it seems likely some model of peer-to-peer disruption will take off.
• Monika Schulze (Zurich) returned to the theme of greater engagement through marketing. Her recurrent theme was the importance of emotion, using your brand and an emotionally engaging narrative consistently across channels to provoke positive responses and engagement from consumers. Inspired by "Transmedia Branding," Schulze really brought this topic to life through a number of videos that made an impact and examples of clever use of social media. Perhaps the most surprising part of this event was a story about Lidl selling milk in Sweden. Through active monitoring of Facebook comments, Lidl spotted a Swede named Bosse who said he didn't want to buy German milk. Lidl used this as a chance to humanize its brand, and the company renamed its milk "Bosse's Milk" across Sweden, including a photo of Bosse and an explanation that the milk actually is Swedish milk. This action, in response to an individual, captured the public imagination and boosted sales. For a great example of fleet-of-foot and creative marketers using emotional advertising, check out Zurich's #SaveThe Snowmen.
• Gordon Rutherford (Axa) also stressed the importance of emotional communication in brand engagement. Along with warning to not be one of those needy brands that basically use social media to say "please love me," he highlighted the impact of finding a noble cause to really make a difference and to improve brand sentiment. An example is Axa's "glass of consciousness" exhibitions in Mexico, which engage the public with the need to change attitudes about drinking and driving. Axa has found a way to humanize its brand and engage its own employees, all the while making a social difference.
• Edward Rice (AIG) shared AIG'S progress in digital transformation, where the company has gone beyond just using digital as a marketing channel and is using it to reengineer business and customer experience. He noted that the right comparison for customer experience isn't the low bar currently set by the insurance industry but is, rather, the personalized, digital ease provided by retailers. He  then shared numerous examples of how, once you have the basics delivered consistently, you can surprise and delight your customers with personalization and relevance. One interesting example was marketing done by Boden and easyJet that shows customers that the brands remember past purchases and have an apparent growing understanding. Rice also touched on the power of responding to one individual on social media as a way to humanize your brand and be playful and on the importance of providing timely advice and warnings that help customers reduce risks.
• Isabelle Conner (Generali) explained the huge cultural transformation that she is leading, changing a 184-year-old business from product-centric to customer-centric. She stressed the importance of emotional brand marketing and reminded everyone that we are in an ideal position to put this into action, with insurance being about protecting what people love and being there when the traumatic happens. But the marketing has to be grounded in changing the customer experience reality and the internal brand reality, not just be about broadcasting a message. Perhaps the part that had the most impact was when she shared videos of Generali's CEOs from Spain, Switzerland and France calling customers who left detractor net promoter score (NPS) ratings. It is so important to include timely response and resolution in your NPS metric programs, but it has even more of an impact on a company's culture when CEOs get engaged in the experience.
• Stephen Ingledew (Standard Life), although not an insurer, has many of the same challenges in the world of retirement savings, investment and income solutions. Ingledew focused on the importance of customer engagement in redesigning improved experiences. He shared some details of co-creation sessions and agile development, the latter being more than just an approach to IT development but also a mindset of continual learning and iteration. Some of his examples of online tools included elements of "gamification," which is helpful for consumers in the baffling world of pension reform choices. The brand approach of "#ReadyWhenUAre" nicely balances a range of enablers, while avoiding being paternalistic. Another critical customer need is education, but it becomes tricky to do it in a way that is neither boring nor patronizing. Selecting Steph and Dom from the British reality show Gogglebox to host a series of videos to chat in the pub about the issues was inspired choice, and one can see why it has gone viral.
• Zach Goren (Media Alpha) brought the world of West Coast U.S. innovation to the conference. Media Alpha is helping auto insurers, among others, buy targeted "in market" customer leads in real time, rather than just relying on mass market advertising through Google (where insurance keywords cost a fortune). Media Alpha is basically an innovation on the traditional market of selling unconverted quotes, but the company does this in real time and stays on the insurer's site. So, the insurer becomes both a seller of insurance as well as a seller of advertising space to competitors, especially where customer details show this person is unlikely to convert. Media Alpha provides real opportunities to offer consumers more choice.
• James Baker (Vitality) leads the insight team and helps the company's brand understand how to bring about behavioral change in its customers. The company has an interesting approach, providing health insurance but also helping motivate you to not need it, through rewards for a healthier lifestyle. This approach provides more opportunity for engagement with insurance customers and offers tangible value back on your policy (many insurers would love to achieve either). Vitality's insight, built on a hybrid segmentation of FSS and behavioral analytics, has identified a number of actions and rewards, under the concepts of "we'll be there for you" and "we'll make it more rewarding to be well in the first place," that have driven significant engagement and behavior change. Ideally placed to exploit wearables and other IoT innovation, given the importance of employers and employee benefit consultants to Vitality's business, the company can also demonstrate benefits in reduced absenteeism.
• David Stevens (LV=) brought to life the complex world of automated advice in the pensions/retirement income sector. The company has innovated with so called robo-advice (although the process also includes human interaction). LV='s innovation with Wealth Wizards (which it acquired) and the fact it has broken down the steps into manageable chunks should really help. With the high cost of advice, too many in the public are not engaging with such an intangible service. A fixed price of £199 for personalized options after automated fact finding is much more accessible, and the offer is communicated in an emotionally warm way. Once again, you can see the influences of both personalization and gamification in the company's communication. The style of communication and the ease of playing with the tools also contribute to humanizing insurance (as does clear fixed pricing).
• Adam Kornick (Aviva) heads up the company's global analytics capability, and he shared how it is using predictive analytics in pricing and risk modeling. Kornick gave an important reminder that price is the primary selection criteria consumers cite with insurance, so personalized pricing matters every bit as much as, if not more than, personalized communication. One of Aviva's key innovations has been to build on the individual price for quoting (based on captured and average data) that others have done for home insurance and to give customers the price of a product that they are most likely to buy next. It was also interesting to hear of Aviva's progress in broker analytics, another reminder as to the importance of the intermediary channel and how predictive analytics can help there, too.

Phew. Well done for making it to the end of this post! Key themes I took away are the need for: personalization, emotions, humanizing insurance, more frequent engagement through communication, innovations and continued focus on the intermediary channel. Hope all those topics and ideas were useful. Please share the insurance marketers' innovations you are generating from customer insight. Meanwhile, if you're interested, you can download a free copy of my presentation here.

There is a myth out there that healthcare providers are unwilling to adopt new technology. It's just not true. In the last few months, I have spoken to dozens of healthcare leaders at hospitals both small and large, and I am amazed at their willingness to understand and adopt technology. Pretty much every hospital CEO, COO, CMIO or CIO I talk to believes two things: With growing demand, rising costs and constrained supply, healthcare is facing a crisis unless providers figure out how to "do more with less." Technology is a key enabler. There is technology out there to help save more lives, deliver better care, reduce costs and achieve a healthier America. If a technology solution solves a real problem and has a clearly articulated return on investment (ROI), healthcare isn't that different from any other industry, and the healthcare industry is willing to adopt that technology. Given my conversations, here are the five biggest IT trends I see in healthcare: 1. Consumerization of the electronic health record (EHR). Love it or hate it, the EHR sits at the center of innovation. Since the passage of the HITECH Act in 2009—a $30 billion effort to transform healthcare delivery through the widespread use of EHRs—the "next generation" EHR is becoming a reality driven by three factors:

• Providers feeling the pressure to find innovative ways to cut costs and bring more efficiency to healthcare delivery
• The explosion of "machine-generated" healthcare data from mobile apps, wearables and sensors
• The "operating terminal" shifting from a desktop to a smartphone/tablet, forcing providers to reimagine how patient care data is produced and consumed

The "next generation" EHR will be built around physicians' workflows and will make it easier for them to produce and consume data. It will, of course, need to have proper controls in place to make sure data can only be accessed by the right people to ensure privacy and safety. I expect more organizations will adopt the "app store" model Kaiser pioneered so that developers can innovate on their open platform. 2. Interoperability— Lack of system interoperability has made it very hard for providers to adopt new technologies such as data mining, machine learning, image recognition, the Internet of Things and mobile. This is changing fast because:

• HHS's mandate for interoperability in all EHRs by 2024 means patient data can be shared across systems to enable better care at lower cost.
• HITECH incentives and the mandate to move 50% of Medicare payments from fee-for-service to value-based alternatives by 2018 imply care coordination. Interoperability will become imperative.
• Project Argonaut, an industry-wide effort to create a modern API and data/services sharing between the EHR and other systems using HL7 FHIR, has already made impressive progress.
• More than 60% of the proposed Stage 3 meaningful use rules require interoperability, up from 33% in Stage 2.

3. Mobile— With more than 50% of patients using their smartphone to monitor health and more than 50% of physicians using (or wanting to use) their smartphone to monitor patient health, and with seamless data sharing on its way, the way care is delivered will truly change. Telemedicine is showing significant gains in delivering primary care. We will continue to see more adoption of mobile-enabled services for ambulatory and specialty care in 2016 and beyond for three reasons:

• Mobile provides "situational awareness" to all stakeholders so they can know what's going on with a patient in an instant and can move the right resources quickly with the push of a button.
• Mobile-enabled services radically reduce communication overhead, especially when you're dealing with multiple situations at the same time with urgency and communication is key.
• The services can significantly improve the patient experience and reduce operating costs. Studies have shown that remote monitoring and mobile post-discharge care can significantly reduce readmissions and unnecessary admissions.

The key hurdle here is regulatory compliance. For example, auto-dialing 9-1-1 if a phone detects a heart attack can be dangerous if not properly done. As with the EHR, mobile services have to be designed around physician workflows and must comply with regulations. 4. Big data— Healthcare has been slower than verticals such as retail to adopt big data technologies, mainly because the ROI has not been very clear to date. With more wins on both the clinical and operational sides, that's clearly changing. Of all the technology capabilities, big data can have the greatest near-term impact on the clinical and operational sides for providers, and it will be one of the biggest trends in 2016 and beyond. Successful companies providing big data solutions will do three things right:

• Clean up data as needed: There's lots of data, but it's not easy to access it, and isn't not quite primed "or clean" for analysis. There's only so much you can see, and you spend a lot of time cleansing before you can do any meaningful analysis.
• Meaningful results: It's not always hard to build predictive analytic models, but they have to translate to results that enable evidence-based decision-making.
• Deliver ROI: There are a lot of products out there that produce 1% to 2% gains; that doesn't necessarily justify the investment.

5. Internet of Things— While hospitals have been a bit slow in adopting IoT, three key trends will shape faster adoption:

• Innovation in hardware components (smaller, faster CPUs at lower cost) will create cheaper, more advanced medical devices, such as a WiFi-enabled blood pressure monitor connected to the EHR for smoother patient care coordination.
• General-purpose sensors are maturing and becoming more reliable for enterprise use.
• Devices are becoming smart, but making them all work together is painful. It's good to have bed sensors that talk to the nursing station, and they will become part of a top level "platform" within the hospital. More sensors also mean more data, and providers will create a "back-end platform" to collect, process and route it to the right place at the right time to can create "holistic" value propositions.

With increased regulatory and financial support, we're on our way to making healthcare what it should be: smarter, cheaper and more effective. Providers want to do whatever it takes to cut costs and improve patient access and experience, so there are no real barriers. Innovate and prosper!

Many tasks and actions have been replaced by digital solutions. This is nothing new. However, sometimes nothing beats a face-to-face with a customer. Now, using a VideoTech platform, Silicon Valley start-up LiveMed replicates the physical face-to-face with a digital one. I'll start with an event that happened to me last year. I’ll skip the details, other than to say I was required to confirm my identity and sign a document by a department in a financial institution. With my passport and utility bill in hand, I went in search of a branch (which isn’t as easy as it used to be, even in Central London). It didn’t help that the fax machine at the first branch I found was out of order, so I had to find another one, which I did! After much back-and-forth on the phone between the department, the branch and me, we completed the process, and I was on my way. What struck me at the time was how out-of-date this financial institution was. Not just technically or digitally but also in terms of customer experience. And it was completely unnecessary. Digital FinTechs and InsurTechs have been onboarding new clients in less than 10 minutes, without any physical interaction. Identities can be proven and verified in a matter of minutes with background checks, a photo of your passport and a selfie. The use of eSignatures is widespread. In the U.S., the Electronic Signatures in Global and National Commerce Act is a federal law put in place to facilitate the use of electronic signatures in commerce (long-form definition on Wikipedia, here). In the European Union, the equivalent regulation is the Electronic Signature Directive (see Wikipedia reference here) that defines the use of eSignatures in electronic contracts within the E.U. Both these legislative frameworks require the same thing, which is that electronic signatures are regarded as equivalent to written signatures. Given all this, was it really necessary for me to spend several hours inconvenienced and, frankly, wasting time? Last month, I wrote about the use of VideoTech in the claims handling process In that piece, I talked to InsurTech startup Vis.io about its use of video technology to both reduce cost for insurers and improve the customer experience for claimants. This week, I move to the front end of the insurance process—client onboarding and policy administration—and talk to LiveMed. To tell me how their solution brings together the use of video, customer identification and eSignatures, I Skyped with Silicon Valley-based co-founder and CEO Yair Ravid. Ravid explained to me, “LiveMed is a platform that allows financial institutions to confirm customer identity remotely, collect signatures remotely and provide a video record of the customer engagement.” The way it works is simple. When a face-to-face discussion is required, the insurer emails a link to the customer. This can be for events such as confirming a customer’s understanding of the insurance policy conditions or witnessing the signing of all parts of the policy agreement. The customer activates the link and is connected via a live video to an insurance agent. The agent uses the LiveMed platform to conduct a secure, face-to-face discussion with the client. The platform allows documents to be shared between the two parties, which they can both review and amend in real time, before both parties sign electronically and the document is locked down. The whole session is recorded and kept for several years in case a customer disputes the policy conditions or that he even signed the policy in the first place. (If you are interested in an example of a policyholder disputing an electronic signature, read this article in the Insurance Journal about Bonck v White.) Knowing whom you’re talking to While digital facial recognition technology (and other biometric measures) are advanced and sophisticated, humans remain better at visual identification. In some jurisdictions, that remains the only option because biometrics are not yet permitted for identity verification. “Humans understand the face holistically,” according to the study “The Limits of Facial Recognition” by Tim De Chant. And visual identification still carries great weight in the process of verifying a customer’s identity and in fraud detection. Humans are better at assessing if we are who we say we are or if our claim is suspect. There will always be occasions when a face-to-face meeting is required to complete a transaction. LiveMed enables this human interaction without requiring the customer to go to a branch or an insurance agent to visit the customer's home. More than a VideoTech platform Behind the video interaction, LiveMed’s algorithms verify the authenticity of documents supplied by the customer. Ravid told me, “When a customer brings in a fake document, we have a high success rate at identifying if it is a fake. We’ve developed a solution that takes real IDs, studies different parameters against them and then compares these with the documents being presented. The institution still relies on human judgment, but LiveMed gives the agent a reliable tool to help with the decision.” The LiveMed platform uses webRTC, an open-source platform that provides browsers and mobile applications with real-time communications (RTC) capabilities via simple APIs. It also runs as a cloud or an on-premise solution to cater to an institution’s specific requirements and policies on security, data and technology. It is a device-independent platform that delivers both mobile and web. Ravid explained, “We’ve worked hard to make this very easy to use for the customer. Simply click on the link, go online with the agent, finalize or review the document, open the signature box and then sign with their finger. Simple! “We take any format document or webpage, whatever, and turn them into a series of pictures. This allows changes, sketches and amendments on the screen by both parties, [in] real time. Then these pictures, or pages, are locked and put together and sent to both parties as a record. We are patenting the technology because we believe it to be unique.” The old-fashioned ways are no longer viable Asking a customer to come into a branch carrying paper documents just isn’t going to cut it any more. Nor is the cost of sending a representative to meet the customer. In this digital, mobile age, time is precious, and money is tight. We are also in the consumer protection age of regulation. Financial institutions need to be able to prove beyond doubt that their conduct is acceptable and that customers fully understand the financial decisions they are making. This requires evidence both parties can rely on should there be a dispute. (See my previous research notes on RecordSure and its use of AI for compliance monitoring.) With LiveMed, the finance institution “sees” the person in real time without the inconvenience or cost of a physical, in-person meeting. And because the transaction is completed there and then, the insurer doesn’t have to wait for documents to be sent and processed. And both parties can be certain there are no mistakes (that it's right the first time) because everything is checked and verified on the video call. What next for LiveMed? Ravid is one of three co-founders who bootstrapped LiveMed and took the start-up through the UpWest Labs accelerator in Palo Alto. LiveMed has now raised its first $400,000 from seed funding on its way to raising $1.5 million in a Series A. The minimally viable product (MVP) is built and in pilot with several financial institutions, and the new funding will enable the LiveMed to launch the platform into the U.S. financial services market. This article was first published at www.dailyfintech.com 

In the first of this three-part blog series, titled “Bringing Insurance Distribution Back Into Sync Part 1: What Happened to Insurance Distribution?”, we talked about the seismic shifts that have rocked traditional insurance distribution and about how insurance companies need to adopt a 2D strategy to thrive in this new environment. There are four fundamental drivers of the seismic changes:

• New expectations are being set by other industries—the “Amazon effect”;
• New products are needed to meet new needs, and risks are distributed in new channels;
• Channel options are expanding;
• Lines are blurring between insurance and other industries.

In this blog post, we’ll discuss how the final three fundamental drivers have contributed to an environment of challenges and great opportunities. Those who adopt a 2D strategy will be better-prepared to seize the opportunities:

• First, by optimizing the front end with a digital platform that orchestrates customer engagement across multiple channels
• Second, by creating an optimized back end that effectively manages the growing array and complexity of multiple distribution channels beyond the traditional agent channel

New Products Customer expectations, behaviors and risk profiles are evolving thanks to technology, social trends and other changes happening around us. These are driving the need for new insurance solutions and, consequently, new distribution methods, such as:

• We all know about autonomous cars and increasing car safety technology. Autonomous cars have created questions about where liability lies in the event of an accident involving one of these vehicles. Volvo has laid down a challenge to the auto and insurance industries with its recent announcement that it will assume liability for crashes of its Intellisafe Autopilot cars.
• The sharing economy—whether it’s for transportation, lodging, labor or “stuff”—has created a multitude of questions regarding coverages. People have realized they don’t need to buy and own cars or pay for hotel rooms when they can use someone else’s stuff for a cheaper price. People who own these items can monetize them when they’re not being used.
• Cyber risk has been around for a long time, but numerous high-profile hacks have made it a hot topic again.
• And, finally, the Internet of Things: Connected cars, homes and personal fitness trackers are generating lots of data with tremendous potential to improve pricing and create products and services, while at the same time reducing or eliminating risk.

The seismic impact has resulted in companies developing and offering new products to meet the changing needs, preferences and risks being driven by consumers. There are several relatively new peer-to-peer companies that have entered the market, such as Friendsurance, insPeer, Bought by Many and the recently announced start-up Lemonade. Metromile addresses the sharing economy trend with its product for Uber drivers, and addresses the niche market of low-mileage drivers. Google Compare, with its focus of “being there when the customer wants it,” has rapidly expanded from credit cards (2013) to auto insurance (early 2015) and now to mortgages (December 2015), all the while expanding to new states and adding product providers to its platform with a new model that leverages customer feedback. John Hancock is using Fitbits as part of the company's Vitality program, which started in South Africa and which uses gamification to increase customer engagement and lead to potential discounts. Tokio Marine Nichido is using mobile (in an alliance with NTT Docomo) to distribute “one-time insurance” for auto, travel, golf and sports and leisure. HCC, which was recently acquired by Tokio Marine, has a new online portal for its agents to write artisan ontractors coverage for small artisan contractor customers. The overarching theme in all these examples is that each company is pioneering ways of distribution, not just new products or coverages. Many companies are direct e-commerce because they are low premium, quick turnaround/short duration and potentially high volume; they are not well-suited for agent distribution. Expanding Channel Options Channel options and capabilities for accessing insurance are expanding rapidly. New brands are entering the market, giving customers new ways to shop for, compare and buy insurance. Comparison sites, online agencies and brokers—such as Bolt Insurance Agency, Insureon, PolicyGenius, CoverHound, Compare.com and the Zebra—are relatively new to the market and are gaining significant market interest and penetration. There are also new brands in the U.S. selling life and commercial direct online, like Haven Life, Assurestart and Hiscox. Berkshire Hathaway will jump into the direct-to-business small commercial market in 2016, a potential game-changing move for the industry. Finally, there are some intriguing new players that are focusing on specific parts of the insurance value chain.

• Social Intelligence uses data from social media to develop risk scores that can be used for pricing and underwriting.
• TROV is a “digital locker” with plans to use the detailed valuation data it collects to create more precise coverage and pricing for personal property.
• Snapsheet is the technology platform behind many carriers’ mobile claims apps, including USAA, MetLife, National General and Country Financial.

Blurring Lines The insurance industry is so valuable that outside companies are trying to capture a share. This has created a blurring of industry lines. Companies like Google, Costco and Wal-Mart are familiar brands that have not traditionally been associated with insurance, but they have offered insurance to their customers. The first time most people heard about these companies' expansions into insurance, it probably struck them as unusual, but now the idea of cross-industry insurance penetration has become normal. In addition, insurance products are blurring and blending into other products. For example, Zenefits and Intuit are considering bundling workers' compensation with payroll offerings. So, what does all of this mean?  There are two key implications from all of this for insurance companies. First, multiple channels are now available to and are expected by customers. There are many ways for customers to research, shop, buy, pay for and use insurance (as well as almost all other types of products and services). Most customers demand and use multiple channels depending on what they want or need at the time. They are more ends-driven than means-driven and will pick the best channel for the task at hand. Second, multiple channel options give customers the freedom to interact with companies anywhere, anytime, in just about any way.  But this only works if these channels are aligned and integrated. An organization can’t just add channels as new silos; they must be aligned, or they will do more harm than good. So, while distribution transformation and digital capabilities promise an easier, better experience for customers, they actually result in increased complexity for insurers. Orchestrating all these channel options is hard work and can’t be done with legacy thinking, processes or systems. This expansion of channels requires insurers to optimize both the front end and the back end of the channel ecosystem.  In my next blog post, we’ll discuss these in more detail.

Managers are more likely to limit rental cars to $30 a day than limit an open heart surgery to $100,000 -- for ethical and regulatory reasons, many executives steer clear of involving themselves in healthcare decisions, other than selecting the broadest possible network access. But few expenses that executives know so little about matter more than those involved in healthcare do. This article speaks to a cultural shift that could provide tremendous impact for employers. They can now lower costs while also improving outcomes. Until now, employers have used two main strategies: --They offloaded costs to employees, hoping that giving them more skin in the game would reduce their spending on healthcare. But the continuing lack of transparency about healthcare costs, combined with costs that rose faster than employers shifted them, resulted in insurance picking up more cost and consumerism being driven down. --Employers also invested in wellness programs. But wellness programs are most attractive to the already healthy. And they attempt to reduce how often enrollees encounter the system. But we know that everyone will encounter care at some point. It is each encounter’s volume and cost that is at the heart of this out-of-control system. The new, better approach was demonstrated in a whirlwind, 48-hour trip I took with some incredible healthcare leaders. First, we met with the executives of Rosen Hotels in Orlando, who have saved hundreds of millions of dollars compared with average employer healthcare costs. Rosen’s single-digit employee turnover would delight most employers, but it is spectacular in the hospitality industry. Rosen achieves this turnover with a benefit-rich plan most employees would drool over: e.g., no-cost prescriptions, $750 max hospital out-of-pocket. How does Rosen accomplish this? First, its healthcare thinking is based on what it wants to achieve rather than what it has to provide. Beginning with the CEO, Rosen’s top executives really care about every one of their employees, as evidenced by the more than a few employees who have been there for 40-plus years. (Remember, this is a hotel chain, not a hedge fund with six-digit salaries). The strategies deployed vary, but they mainly support making the highest value care as accessible as possible. Value—a fair return or equivalent in goods, services or money in exchange for something—is seriously lacking in American healthcare. Rosen took it upon itself to provide healthcare whenever and wherever possible, using its clout to lower costs. The company arranged special prescription drug discounts with Walmart. Rosen has on-site medical directors who personally engage with each employee’s health. The directors visit employees in the hospital and help arrange home delivery of costly specialty medications from lower-cost pharmacies. The company monitors and supports sick employees’ recovery and progress. It also built a health-and-wellness center for all employees and dependents with primary care, prescriptions, fitness instruction and more. I know all this sounds expensive, but the impact far outweighs the cost. The second part of our adventure involved a flight to the Caribbean island of Grand Cayman, just south of Cuba, a beautiful tropical setting an hour-long flight from Miami (and with direct flights from a dozen other U.S. cities). The morning after our late arrival, we enjoyed the beautiful sunrise for exactly 20 seconds before we were bused to a facility called Health City Cayman Islands (HCCI). The single building on 200 acres (with significant future expansion plans) is clean, new and functional, though it is not nearly as grand as many U.S. mega-hospitals. Now two years old, HCCI is a joint venture between Ascension Health (a non-profit U.S. health system) and Narayana Health, a top Indian health system based in Bangalore. HCCI’s Indian roots are very important, because that country has no national healthcare or insurance system. The Indians have a novel approach to healthcare: You pay for it. Narayana Health, which has achieved Joint Commission International (JCI) accreditation, performs a volume of procedures unprecedented in most hospitals. This volume is produced by a highly experienced team with quality outcomes that equal or exceed the best U.S. hospitals, but the team does it at far lower cost. Dr. Devi Shetty, Narayana’s founder and a cardiologist who has performed more than 25,000 heart surgeries, is focused on reducing the price of an open heart surgery to $800. (It currently sits around $1,400). Compare that with a 2008 Millman report that pegs U.S. open heart surgery costs around $324,000. Some employers—Carnival Cruise Lines, for example—are so convinced of HCCI’s value (better health outcomes at far lower cost) that they will pay for all travel, including a family member’s accommodations for the length of a stay, and often waive an employee’s out-of-pocket costs associated with the procedure. While HCCI’s pricing is higher than its Indian sister facility, many people could afford to pay for HCCI’s care with their credit card, if that were necessary. HCCI charges a single, bundled fee that covers all associated costs, plus the cost of most complications -- the director says, “Why should the patient pay for something if it was our mistake?” Compare that attitude with that at U.S. facilities, which have financial incentives to deliver as much care for as long as possible, and which get paid more if they make mistakes. HCCI’s upfront pricing model creates a serious incentive for efficiency and quality, because the facility is financially responsible for complications, infections and extra tests. Patients and purchasers (i.e. employers and unions) should realize that nearly all U.S. healthcare—hospitals, doctors, drug companies and even insurance carriers—are structured to benefit from more care, rather than good, efficient or innovative care. This means that purchasers and patients must use any available levers to get the best healthcare value they can. As Rosen and HCCI have proven, those levers are increasingly available.

The connected world is here. Everything is "smart." And for insurers, the implications are huge. Whatever you insure can now be connected, monitored and analyzed. People, places and things, moving or stationary, living or non-living—are all becoming smart. Think that is an exaggeration? Consider the following products announced or displayed at the Consumer Electronics Show (CES) 2016, just a few of the thousands of smart products:

• Smart air vents to monitor and adjust temperature in each room, detect for early signs of mold, etc.
• Smart drinking glasses to monitor hydration and caffeine intake
• Neuro-stimulation devices to block chronic pain or alter moods
• Smart appliances that manage energy efficiency, anticipate failures, conduct e-commerce, etc.
• Wearable patches to monitor UV rays, toxic exposure and biometrics
• In-car cameras that monitor a driver’s pupils for signs of stress

Add to that list smart belts, umbrellas and smoke alarms among many other things, and it’s difficult to find anything that doesn’t have a "smart version" today. And it’s all pretty exciting stuff. But here’s the rub—in many cases, the technology is way ahead of the desire and ability of consumers and businesses to use it. A few important considerations emerged as central themes at CES:

1. Value propositions need more work. Many of the products at CES were narrow-use, high-priced items that work in isolation.
2. Customer experience is still king. Products must be easy to install, easy to use and engaging. Progress is certainly being made here, especially among wearables, but some of the smart home and car products need to take the experience to the next level to get beyond the early adopters.
3. Platforms and standards progress are required. Competing platforms for smart home hubs, connected car capabilities, intelligent infrastructure and other areas may impede adoption. The competitive environment is healthy, but widespread adoption will require more interoperability standards and a shakeout of players.
4. New ecosystems and partnerships are rapidly evolving. Industry boundaries are disappearing, and new industries are emerging. Success in the connected world will require active involvement in various ecosystems as well as a flexible partnering strategy.
5. Analytics and cognitive computing will be the differentiators. Embedding chips, sensors and devices into everything is creating vast oceans of data. The value will increasingly be based, not on owning proprietary data, but on the ability to gain actionable insights. Cognitive computing goes even further by automating real-time learning, reasoning and recommendations.

These five considerations along with other factors will affect adoption rates and opportunities for businesses and consumers. But it would be a mistake to conclude that there are too many complications or barriers to progress. In fact, the opposite is true. Advances are being made at breakneck speed, and barriers are being knocked down on a regular basis. If anything, this means that insurers need to be even more diligent and aggressive in shaping the future.

So, innovate to create new value propositions. Seize opportunities to transform the customer experience. Weigh in at relevant standards and platform discussions. Join new ecosystems and seek partnerships with unconventional allies. And build up your enterprise analytics expertise and capabilities.

The digital, connected world is here. If you want your company to thrive in this new era, you must jump in with both feet. The possibilities are endless, but you must play a role in shaping and capitalizing on them.