Tag Archives: denim summit 2017

Best of Both Worlds: Humans and Tech

There’s a lot of talk about how artificial intelligence (AI) will lead to the displacement of vast numbers of agents and brokers in the insurance industry. The truth is, while AI will automate certain processes, it will ultimately enhance — rather than replace — humans in the marketing and distribution of insurance.

“Human advisers are going to continue playing an absolutely critical role,” said Farron Blanc, VP, Innovation Studio for RGAx, at Denim Summit 2017. “When you go fully digital, the conversion rates are probably about 1% from seeing an ad all the way through paying the first premium. As soon as we put in a call center, we’re seeing — depending on the segment — a 30% conversion rate.”

There’s no question both humans and technology will play a critical role in the future of insurance. But what are the benefits only a human can bring, and what are things humans can’t do without technology? Let’s take a look.

The Human Value

Below are a few things humans bring to the table that technology can’t do alone:

  • Trust. As Chip Bacciocco, CEO of TrustedChoice.com, pointed out during Denim Summit 2017, insurance is, at the end of the day, a social contract and requires trust. “The real point of buying insurance is that you can go to sleep at night feeling like you did the right thing, you’re taking care of your family,” he said. “If you aren’t 100% certain you clicked the right button on that screen, and that real people are really going to pay your claim someday, you never really get to sleep.”
  • Accountability. Along with trust, any type of business or social contract needs someone to hold accountable. “You need to know who to talk to when something goes wrong. You need to know who your advocate is,” Bacciocco said.
  • Expertise. Let’s be honest: Insurance is confusing. Often, customers and potential customers need to talk to another human being who can empathize with their concerns and truly get at the heart of their questions. Agents and advisers bring years of expertise to the table that can help customers make the right decisions and give them peace of mind.

See also: Cyber: How to Fix the Human Factor  

The Technology Value

Here are the types of benefits made possible only when technology is added to the equation:

  • New markets. Technology makes it possible to reach new market segments. For example, RGAx looked at the needs of Hispanic remitters and found that a $7 per month insurance policy would solve a pain point for them: protecting their loved ones with remittances for two years if something were to happen to them. “How do you get humans to sell $7 insurance to people who really need it?” Blanc asked. “Technology is this great democratic leveler that allows us to reach new forces.That’s why it’s disruptive. It allows us to reimagine the value chain and serve people in whatever way they want.”
  • Personalization. There is an unbelievable amount of data available on consumers, especially when it comes to their digital behaviors. Recently, Denim announced we have collected more than 1 billion data points on consumer engagement with mobile and social media ads powered for insurance and financial services companies. Technology allows us to activate data to deliver highly relevant offers and personalized experiences to consumers.
  • Multiple channels. Not all consumers want to engage with their insurance and financial services providers the same way. Some would prefer to do everything face-to-face or over the phone, while others would prefer to do everything online. Still others will start the process online but then need to talk to a person to complete the request. Technology makes it possible for consumers to engage with providers in the channel they prefer, any time of the day or night.

See also: How Technology Breaks Down Silos  

Key to the future will be combining the best elements of human interaction with the best elements of technology to provide a superior experience to every consumer, every time.

What Will AI Change First?

It’s clear developments in artificial intelligence (AI), machine learning and other innovative technologies will have an impact on nearly every industry — including insurance and financial services. But what areas will be affected most in the near future, and how will they be affected? These are questions we explored with nearly 100 industry leaders during Denim Summit 2017 in Des Moines.

When we posed the question, “What insurance process will be most affected by AI?” in a live poll, “underwriting” won with 39% of the responses. Following closely were “marketing and distribution” with 32% and “customer service” with 26%. Clearly, it’s not just one area that will be affected. Perhaps a better question is, “How will each area be affected?” Let’s take a look.

Underwriting

As author, speaker and futurist Blake Morgan writes in Forbes, AI has the potential to automate the entire underwriting process. Imagine a world in which bots scan a consumer’s social and digital profile to gather information and find trends and patterns. Someone who has a healthy lifestyle and steady job may be less likely to get into car accidents or rack up medical bills, which could lower insurance premiums. “AI can analyze data better than humans to more accurately predict each customer’s risk, thereby providing customers with the right amount of insurance and companies with protection from risky customers,” Morgan writes.

See also: Strategist’s Guide to Artificial Intelligence  

Marketing and distribution

Hyper-personalization is the new norm in marketing and distribution. Brands are becoming dramatically more attuned to the needs and priorities of consumers and increasingly shaping their product offerings around rising lifestyle trends. Traditional blanket methods like cold calling no longer cut it in today’s uber-connected, digital age. AI can pull in consumer data to create a full profile that can be used to offer only relevant insurance products and remember a consumer’s preferences.

Customer service

According to a study by Oracle, nearly eight out of 10 businesses have already implemented or are planning to adopt AI as a customer service solution by 2020. There are two primary ways organizations are augmenting their customer service experiences with AI:

  • Front-end, AI-powered bots, or conversational computer programs that interact directly with a customer without human interaction.
  • AI-assisted human agents, or human customer service representatives who are supported by AI technology.

For at least the foreseeable future, chatbots won’t replace humans in customer service centers. They will, however, replace some of the tasks traditionally handled by people and, ultimately, enhance the experience for consumers. Customer service and experience expert Shep Hyken shares four reasons AI and chatbots are improving customer service in big ways:

  • Chatbots never sleep.
  • Chatbots won’t make you wait.
  • Chatbots personalize the customer experience.
  • Chatbots make friends and build relationships.

See also: Group Insurance: No Longer Overlooked  

While AI’s value proposition may be clearer in some areas than others, it’s not hard to imagine a future in which nearly everything we do — in both business and in life — is somehow affected by AI.