Tag Archives: ccm

How AI Powers Customer Contacts

For insurance carriers, customer retention relies on trusted communication between the company and its customers—often by way of representatives like brokers and agents. Developing and maintaining that trust depends heavily on the quality of policyholder communications: knowing and understanding your customers and presenting your brand in such a way that customers feel they know and understand you. While this seems a simple concept, in this era of digital communications it requires—and customers expect—the intimacy of personal interaction distributed through sophisticated and varied media channels and devices. 

The customer communication management (CCM) systems that many insurers employ today are able to create communications to be delivered via the various channels that customers prefer. However, modern CCM systems are capable of even more personalized and relevant interactions. And there’s the problem: Many insurers have been in business long enough to experience evolving generations of communications systems. This has resulted in valuable content and customer communications being stored in various silos throughout the organization—one for marketing, another for billing, another for claims and so on—and often in near-obsolete formats or systems. 

For customer service representatives, claims adjusters, brokers or agents, finding the right template can be problematic and time-consuming. Then, creating an appropriate response with approved content is yet another hurdle. Ideally, every insurer today should have a CCM system that is able to draw on the accumulation of content from customer communications from all internal departments, then assist business users in using that information to create a fitting response. If that is not possible in your organization, a more robust CCM system needs to become a priority for the sake of your staff and to satisfy increasing customer expectations. 

Moving to a better system

If the necessary content and customer information required for a new CCM system are still housed in disparate silos and legacy systems, the question becomes, where do you begin? When considering migrating to a modern CCM system, we recommend starting with a communications assessment to get a realistic idea of the scope of the task you’re undertaking. Consider the volume of the materials you have, where they are located in your organization—again, they may be distributed among several departments and systems—and your priorities. What will your future omni-channel customer experience look like? This understanding will help determine what kind of CCM system best suits your requirements, the plan needed for migrating to a new system and the costs involved.

Traditionally, the only way to migrate legacy content was manually. That meant getting staff to look at the tens of thousands or hundreds of thousands of documents and content messages in your files, then sort them into various piles, labeled as “obsolete,” say, or “excellent explanation,” or “good introductory paragraph,” or “Connecticut doesn’t require this any more.” Depending on the volume of communications and associated content objects in your archives, this process would likely mean a major investment that could include hiring and training many more people and allowing them months or even years to sift through everything. Add to that the potential for human error, and you can see what a painstaking, expensive and fraught task this is. One alternative is to “lift and shift” all content from your old systems into a new one. Unfortunately, this move won’t deliver the change you are looking for as it just recreates the chaos of your old systems in the new platform.

See also: AI Ends Guesswork in Uncertain World

One answer is to apply more advanced technology to review and sort out your existing customer communication files. Modern technologies, such as artificial intelligence (AI), machine learning (ML) and natural language processing (NLP) are increasingly being used to significantly accelerate content migration and optimization processes. To begin with, AI can be a powerful tool to automate the ingestion and metadata tagging of legacy content from various file formats and systems. In addition, AI,  ML and NLP can analyze content and communications to identify outdated, off-brand, duplicate or similar content, as well as inconsistencies or non-compliant branding, reading levels and sentiment. This content can then be optimized prior to importing it into a content hub for use in future communications. Applications with these kinds of built-in AI and ML functions have been known to reduce the time required to modernize and optimize your existing customer files by as much as 99%.

Putting it all together

The aim of this process is to then to house the content in a centralized content management system or “content hub.” This enables your content authors to centrally control content and provide customer-facing teams with access to approved communications regardless of the channel (print or digital). This content hub should include documents like disclosures, policy statements and explanations of benefits, standard customer correspondence templates for claims responses, account servicing and billing to enable servicing teams to build relevant and personalized correspondence. The right hub will also help to automate the application of the required regulatory and compliance language for different states and jurisdictions. The AI-powered content hub would offer nearly all the pieces needed to put together a customized and relevant reply to a customer query via the preferred channel of communication. 

These systems empower your customer-facing teams, ensuring they use the latest, approved content and enabling them to add relevant, personalized messaging based on real-time information. AI embedded within these systems can provide guardrails to ensure communications stay within brand, reading level and sentiment guidelines. This not only helps to protect brand equity, but it also assists the organization overall in driving toward a more consistent, cohesive customer experience across various touchpoints and channels. 

As insurers have expanded customer touchpoints across new digital channels, delivering consistent and relevant communications presents new challenges. Increasingly, both existing and prospective customers expect prompt and appropriate answers to their queries via the channel of their choice, or they may look to your competitors. With a solid communications strategy and a CCM system that supports it, you will find new ways to create, manage and deliver an array of complex insurance communications with consistency and efficiency, which can be a significant factor in winning — and keeping — your customers.

Ready to Comply With Fiduciary Standard?

Recent actions by the U.S. Department of Labor (DOL) are causing insurance and other financial services brokers to rethink their business models and how they communicate with their customers. That’s because the DOL recently finalized a controversial new standard broadening the definition of who constitutes a “fiduciary” under the Employee Retirement Income Security Act (ERISA).

Essentially, the rule, with an applicability date of April 10, 2017, heightens the duty of financial advisers for 401(k) plans and IRAs who are considered “brokers,” defined as registered representatives of a broker dealer paid commissions by the investments they recommend. Before the new rule, brokers were held to a standard of suitability, which meant that, when a broker recommended that a client buy or sell a particular security, the broker must have a reasonable basis for believing that the recommendation is suitable for that client. That standard allowed brokers to recommend an investment product that paid them a higher commission as long as it was suitable for the client, even though it may not be the best choice. Under the new fiduciary standard, brokers must put their clients’ interests ahead of their own in recommending investments.

See also: Do Brokers, Agents Owe Fiduciary Duty?  

The new standard for brokers puts them on par with investment advisers registered with the Securities and Exchange Commission or individual states, who were already required to meet the fiduciary standard. The change presents a challenge to the business model of brokers, who typically get paid from commissions, unlike registered investment advisers, who are paid a percentage fee based on the amount of plan assets under management.

New challenges for broker customer communications

The challenges the new rule poses for brokers don’t end with compensation. The new duty will directly affect any information brokers provide to customers in print or digital form that might be deemed a “recommendation” under the rule. A fact sheet provided by the DOL describes a “recommendation” as follows:

“A ‘recommendation’ is a communication that, based on its content, context and presentation, would reasonably be viewed as a suggestion that the advice recipient engage in or refrain from taking a particular course of action. The more individually tailored the communication is to a specific advice recipient or recipients, the more likely the communication will be viewed as a recommendation.”

A holistic view of the customer communications ecosystem

In short, every broker customer communication will now need to be audited to determine whether it constitutes a recommendation and modified if it would violate the new standard. This could be an onerous task.

Customer communications management (CCM) processes will be essential for complying with this new rule. Adding personalization to communications is a huge advantage to the adviser, but it is now critical to have a process for reviewing these personalized communications to confirm that they conform to the new legal reality.

CCM becomes even more critical considering the efficiency and control that can be gained by centrally managing this content. Scattered, decentralized communications processes will make it far more likely that an adviser will send noncompliant content to a customer, exposing the company and the adviser to considerable risk.

Many insurance agencies and other brokers use legacy systems to generate their customer communications, which makes it costly and time-intensive to modify them to ensure compliance with the new rule. IT departments have the skills to make the needed changes, but not the time or full expertise to review and audit the updated customer communications. Insurance organizations should give careful consideration to the following to identify potential obstacles to compliance:

  • Determine where customer information is stored. If it resides in multiple departmental systems, there is greater risk that advisers will send noncompliant communications to customers unless these systems are coordinated.
  • Consider whether existing CCM processes and systems are flexible enough to incorporate compliance review for today’s wide range of communications channels, including mobile, email, web pages and social media.
  • Analyze how customer activities are supported by different channels in the organization. Channel communications may be intertwined from a customer’s perspective, but managed separately within the organization. Achieving compliance will require understanding how communications appear to the customer.
  • Ensure that compliance officers and other regulatory personnel are engaged early in communications creation and automate approval processes to speed time-to-market and create audit trails.

With the new DOL rule, brokers want to know what constitutes a recommendation, and they want to know how to effectively communicate with customers in a compliant way. Ideally, insurance organizations will find strategies that allow brokers the freedom to personalize their customer communications so that they can differentiate from the competition, while at the same time receive the timely guidance they need to avoid making an unintentional recommendation.

See also: Fiduciary Liability Insurance in the Nonprofit Sector – What You Need to Know  

Accomplishing this will require a careful look at the current customer communications ecosystem and taking the necessary steps to ensure that compliance review is integrated into workflows in the most effective, yet least intrusive, way.

Direct Mail Remains Relevant

Like organizations in nearly every industry today, insurers are pushing for digital innovation as a means to improve customer acquisition and the customer experience. This focus is essential for future success, but a danger also lurks in this strategy.

With digital channels clearly proving their worth, marketers are in danger of overly focusing on the new communication channels and under-utilizing traditional means of communicating with customers, such as direct mail — which recent research indicates is as effective as ever, if not more so.

Direct mail is still popular with every age group

A recent study by InfoTrends, a worldwide market research and strategic consulting firm, and co-sponsored by Prinova, reveals the continuing effectiveness of direct mail. The study, “Direct Marketing Production Printing and Value Added Services,” found direct mail is being responded to at a high rate across every age group.

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Perhaps particularly surprising to many is the strong response rate for those in the millennial generation, because this demographic is by far the most digitally connected we have seen. However, despite their digital connectedness, millennials reported as a group that they:

  • Last responded to direct mail on average within 2.4 months, quicker than the average response time reported by all respondents, and
  • Open the direct mail they receive at the same high rate (66%) as recipients overall.

Perhaps most important, 63% of millennials who responded to a direct mail piece within a three-month period actually made a purchase.

See also: 5 Accelerating Trends in Digital Marketing

A USPS study reached a similar conclusion about millennials’ interest in receiving political direct mail. Commenting on the study, USPS sales VP Cliff Rucker said, “As the much-coveted demographic of 18- to 24-year-olds has grown up with and around computers, focusing exclusively on digital channels seems like the obvious strategy. What we actually found was that millennials are far more likely than non-millennials to read and engage with direct mail, particularly political mail.”

Consumers open direct mail for a number of reasons, but interest in the products and services offered tops the list. Additionally, one quarter of those in the 25- to 34-year-old age range opened direct mail because of the print and image quality, and 25% of millennials consider reading direct mail a leisure activity. Personalization has a very strong influence on whether a recipient will open the direct mail.

Additionally, recipients 65 or younger are more likely to prefer direct mail over email correspondence or consider direct mail and email to be equally preferable. Similarly, those under the age of 65 are more likely to take action in response to direct mail versus email or are equally likely to take action in response to either a direct mail or email communication. The value of a cross-media marketing approach is strongly supported by these results.

Key findings of the InfoTrends study

The InfoTrends research supports several key points about how direct mail influences consumer purchasing behaviors:

  • All demographic groups — even millennials — frequently read direct mail.
  • A high percentage of those surveyed reported they had responded to direct mail within the three months before the survey.
  • Direct mail drives both online and bricks-and-mortar traffic.
  • Direct mail continues to trigger sales.

The research found that almost two-thirds of marketers are attempting to coordinate direct mail with other marketing activities, and a top goal is to improve data-driven personalization and relevant communications with direct mail. Nonetheless, a danger remains that insurance organizations may neglect direct mail in favor of the latest new digital channel.

Getting the most from direct mail

One important fact the InfoTrends research revealed was that more than 37% of the data that marketers require for an effective direct mail campaign is controlled by IT, signaling the need to leverage customer communications management (CCM) technologies that can merge silos of critical data repositories.

See also: From Marketing Myths to Truths  

Insurance organizations striving to make direct mail as effective as possible should make sure the CCM platform used to create the direct mail provides an intuitive interface for non-technical users to easily visualize and build out content and rules intended for each touchpoint. It should also enable a high degree of variability to provide consumers with information that is highly relevant and personalized to them.

The InfoTrends research demonstrates the need for marketers to integrate direct mail with today’s digital channels. With personalization, color and high-quality printing, direct mail can make a powerful impact on all customer groups, even digitally focused millennials.