Tag Archives: disney

Key to Digitizing Customer Experience

Every aspect of the way we interact with goods and service providers is becoming digitized, but it doesn’t work to go partway. As insurers, we have to ask ourselves, “What does a complete digital experience for our customers and policyholders look like?”

In my travels over the last year, I have run into experiences with very large companies and enterprises that have excelled in customer service in the past, but today are falling short in the new digital experience realm. I’ll share some examples, and, insurers, lend an ear. There are valuable lessons to be learned here!

Earlier this year, I took my family to Disneyland. Disney, of course, is a leader in customer experience as well as digital transformation. Disney has gone out of its way to improve a customer’s access to park information. The company has digitized the ride process with fast pass and even offer a suite of apps to improve the customer experience. What I experienced though, in my view, was a fundamental failure to plan a digitally transformed end-to-end experience.

See also: Today’s Digital Customer: It’s Me  

Most people buy their Disney passes on-line. That’s great! That’s fast and easy. But the park entry process is still highly manual. Season pass holders are mixed in with day pass holders; check-in agents manually process the passes, check IDs and passports and take photos for multi-day pass holders. Meanwhile, day pass holders wait in a line of thousands of people all corralled into 20 lines, 100 people deep. This results in confusion, frustration and many children having meltdowns in the hot California sun. It took our family 45 minutes just to walk into the park.

The point is, digitization is great, but you have to think of the holistic experience – everything from buying a pass to getting customers into the park with an easy check in to getting them out again, and everything in between. Disney is one of the best, but even Disney can fall short. The reason is because digitization changes not only the front-end buying experience but the back-end processes, as well. Disney has access to immense amounts of data, including online ticket sales, and has the power to predict wait times and improve service at check in. The lesson here? When creating a digital experience, use all the tools available to you and don’t forget about the nuances of the experience. #disneyland

Of course, I have had some great and pleasantly surprising digital experiences over the last year, too. I took a ski trip and got to experience the Vail Resorts Epic Day Pass. Ski lift tickets have been replaced with RFID-enabled cards that are read without having to wait in line to be scanned. These Epic Day passes also synch to the Epic Mix app, which tracks your runs and your day on the mountain from a number of scanners placed on the lifts and throughout the mountain. The Epic Day pass also can load your credit card for use all over the mountain, so no need to carry a wallet. This is a great example of innovation and digitization with pure customer experience in mind from start to finish.

Just as surprising is what my daughter recently told me about the new online application to sign up my grandkids for swim lessons in her tiny New Hampshire town. Gone are the days of phone calls and paper applications. She says that, because of the online application, registrations are the highest ever!

Now, back to insurance. Did I mention that we recently renewed our professional liability policy? Every year, we are required to make a formal submission. Our agent was on top of it this year, we renewed early, and we actually received our quote and policy – all electronically! And then this happened: I just received a paper letter informing me that the expiring policy is not being renewed! Old, irrelevant and confusing. This automated paper form letter is disconnected with the renewal process and status. Unfortunately, there are still many cases like this happening in insurance.

See also: Customers’ Digital Expectations

These are just some thoughts from my travels about getting digitization right or missing the mark when it comes to the end-to-end customer experience. But insurers, take note: It is important to look at what outside companies are doing to see how they are digitizing their customer experience. If a tiny New Hampshire town can do it for preschool swim lessons, there is no reason insurers can’t make some significant steps to go digital.

10 Insurance Questions for 2017

Love it or hate it, 2016 was a year that brought many surprises. And 2017 is looking like another year of unexpected outcomes. The saying goes, “May you live in interesting times.” And we are definitely living in interesting times, including in the insurance industry.

Here are 10 insurance questions for 2017:

1. Will this be the year that the U.S. insurance industry makes a definitive move toward level commissions or fee-based products across all product lines?

Most other professional service providers are paid on an hourly or fee basis, including accountants, attorneys, physicians, trust officers and the majority of financial planners. The Department of Labor fiduciary rule is driving some insurance companies to offer fee-based annuities for retirement plans rather than traditional commission-based annuities. See my take on this: The Fiduciary Rule: A Call To Arms for the Insurance Bill of Rights: Aligning the Insurance Industry With Consumers. The U.K. already has a commission ban, yet life insurance sales are now trending up. While, there are differences in the U.S. and U.K. markets, the core principles are the same. To learn more, visit the Nerd’s Eye View Blog for Bob Veres’ in-depth look. Commissions are not necessarily the bottom-line issue; it’s the premiums that really make the difference.

2. Will the Affordable Care Act stay in effect? 

While no one knows for sure, it is unlikely that the ACA will be completely repealed any time soon. President-elect Trump, along with leaders in Congress, have vowed to repeal and replace, but doing so will be challenging given the lack of votes in the Senate. And while there are significant issues with the ACA, consumers do benefit. Also, healthcare organizations and insurance companies having spent millions of dollars to adjust to it. What is likely is that changes will occur on a gradual basis. The bottom line is that one of the most important benefits to U.S. citizens is the ability to purchase health insurance if you have any existing (or past) health issues. Prior to the ACA, it was challenging to get an individual health insurance policy, which created a bigger issue for individuals and for our overall society. Yes, premiums are increasing, and there are fewer insurers participating. At the same time, it is estimated that there are more than 20 million people with insurance under the ACA. Change will happen, just gradually. If the ACA is replaced, there remains the questions of how to fund it, if the current mandates (taxes and penalties) are stripped out. The funding is one of the core issues and does need to be revised. Insurance companies have also left the federal and state exchanges in a number of states, and they will need to be given incentives to return to the marketplaces.

See also: Top 10 Insurtech Trends for 2017  

3. What will happen with long-term care insurance (LTCI)?

The need for long-term care insurance is not going away; people are living longer, and healthcare costs are rising. Medicaid coverage is minimal and does not apply to most long-term-care expenses. Older LTCI policies have experienced significant premium increases for many reasons, but since the passage of the National Association of Insurance Commissioners’ Rate Stabilization Model Act, there have been fewer increases on newer policies (Read more: “What’s ahead for long term care insurance” ). Currently, hybrid long-term-care/life insurance policies are experiencing growth, but these complex policies are not a solution, as they are a step away from providing a direct protection against the specific risk being insured, which means they are more expensive than a stand-alone LTC policy. A new issue coming up is that some states have “filial responsibility” laws that obligate adult children to financially support their parents and are starting to be used by some nursing homes.  Read about it here.

4. Will insurance agents go extinct?

No, insurance agents will not be going away. However, the way that insurance agents currently do business and have historically done business will be going away. With greater access to information and technology, insurance agents will become true advisers to their clients rather than simply transacting product sales. Professional insurance agents provide value to consumers when they help them understand how insurance policies work and when they assist consumers in making wise choices. The insurance agents who survive will be the ones who recognize that they need to align their interests with those of consumers and work in their best interests by recommending insurance coverage that consistently meets the needs of their clients. Insurance agents will need to follow the concepts outlined in The Insurance Bill of Rights. Mark Twain said, “The reports of my death have been greatly exaggerated,” and this certainly applies to insurance agents.

5. Will consumers finally discover the value of disability insurance? 

Disability insurance is the most overlooked financial tool. Disability insurance is a necessity for anyone who depends on their income. If we are discussing a mandatory insurance coverage, disability insurance should be at the top of the list. Three in 10 workers entering the workforce today will become disabled for some period before they retire (Social Security Administration, Fact Sheet, January 31, 2017). This point was brought home by the fact that Colin Kaepernick did not play this year for the San Francisco 49ers until they purchased a disability insurance policy for him. Read more here.

6. Has the annuity marketplace hit its turning point? 

The current annuity marketplace is filled with complex annuity options that are increasingly challenging for an insurance agent to understand, let alone being understandable for consumers, especially seniors, who are heavily marketed to. The annuity industry continues to face significant market conduct issues in terms of suitability and disclosures (Read about the investigation by the New York Department of Financial Services). Annuity companies that think outside the box and provide low-cost, easy-to-understand solutions will gain popularity. A number of leaders in the financial planning area are already discussing the value of single-premium immediate annuities in investment portfolios to help offset longevity risk (living too long). This will only happen with low-cost annuities and where agents can really provide value by recognizing and solving challenges that can only be addressed with annuities that serve the consumer by getting back to the core function of annuities.

7. Have we reached the tipping point for when the impact of the prolonged low-interest-rate environment will fully emerge on interest-sensitive life insurance policies? 

The majority of universal life policies issued are facing the hidden danger of terminating long before they are expected to. This is due to lower-than-projected credited interest rates, which has led to reduced cash values. If a life insurance policy reaches a cash value of zero, it will terminate unless it has a no-lapse guarantee. The only way to keep the policies in force is to increase the premium, however, life insurance companies, for the most part, are not advising policy owners that they need to increase the premium and specifying the amount by which the premium needs to be increased. This situation has been exacerbated by the fact that a number of life insurance companies have had to increase their mortality costs (cost of insurance charges) to maintain profitability. Continuing to ignore this issue is going to have significant long-term ramifications for the stability and trust in life insurance companies and life insurance agents. This is affecting all types of life insurance that are not guaranteed products, just not as directly. Read more: Will Your Life Insurance Terminate Before You Do?

See also: 10 Predictions for Insurtech in 2017  

8. Is there truly an insurtech company that can add core value to the insurance process?

The insurance industry needs evolution, and not revolution. The majority of insurtech companies are really bringing us more of the same; they are really just “dressed up” insurance brokerages and insurance insurance companies. And while some do make use of technological breakthroughs, they are not making insurance breakthroughs, which is an important distinction. The real breakthroughs will come from when consumers can more easily understand insurance products and pricing and companies can use data to provide truly customized insurance product pricing, streamline underwriting, simplify products and riders and provide insurance products that people need, thereby eliminating those that don’t have a useful purpose.

9. Is it time for insurance policies to finally be used primarily for insurance purposes?

The insurance industry will recognize that it must get back to its core function, which is protecting against potential risks. When this happens, it will lead to better-optimized insurance products for consumers and longer-term business for insurance companies. This will especially be true in the areas of life insurance and annuities when the trend becomes using insurance to address non-insurance issues. Insurance is just insurance.

10. Will the insurance industry discover excellent customer service?

Quality policy owner service is not something that the insurance industry as a whole is known for. Companies that provide top-notch customer experiences thrive, are well-known for doing so and can be easily named (think: Nordstrom, Disney and Apple). Other companies are known for poor customer service, while most remain in the middle. FedEx, which used to be known for top service, now delivers packages at any time and leaves them all over the place. The point is that a quality policy owner experience will revolutionize the insurance process. If the insurance industry can learn to “delight” consumers at every step along the way from the policy selection process, policy application and underwriting process, policy monitoring and claims service, then the insurance industry will really move forward.

The Bottom Line

Greater insurance literacy will benefit consumers and members of the insurance industry. Following the guidelines of The Insurance Bill of Rights is what will move the insurance industry forward. Ask your agent and insurance company if they’ve taken The Insurance Bill of Rights Pledge and look for the Insurance Bill of Rights Seal on their website. If they haven’t taken it, ask them why not or what they have to hide about fairness and disclosure — and join The Insurance Bill of Rights Movement by signing the petition to support The Insurance Bill of Rights (click here).

If you have any feedback or your own questions for 2017, please let me know. Thanks for reading.

The Right Way to Tackle Gender Bias

What is the difference between Sheryl Sandberg, Melinda Gates, Cinderella and Elsa from Frozen? Well, each is worth billions, each commands an immense global platform and each has dedicated her life to capturing the hearts and minds of girls and inspiring their dreams. Whether she knows how to code or whether she has magic powers, those are distinctions without a difference.

In fact, these four figures are all the same: They are princesses.

What I mean by that is we have changed the look and feel of the characters put forth for girls to admire, but we haven’t moved past the stage of fueling fantasies to the stage of creating change. We gave the princesses a makeover, but we didn’t address the core issue.

We are solving the wrong problem.

We decided we wanted girls to embrace heroines who are strong and fearless and can do anything boys can do. We want girls to admire women who code and who are scientists and gymnasts and world leaders. To put it bluntly, we want to see girls dress up as Olympic gymnast Simone Biles or Olympic swimmer Katie Ledecky for Halloween instead of as Disney princesses Ariel or Belle. If we succeed, if fairies and mermaids are a thing of the past, we will still be in exactly the same place: asking ourselves why women aren’t leading companies; why girls aren’t pursuing careers in technology; and why, when they graduate from college, women enter the workforce at the same rate as men but leave it at a much higher rate.

Sandberg or Gates are shining examples of people we should admire and attempt to emulate. They are making tremendous contributions to everything they become involved in. Gates is literally eradicating diseases and lifting entire populations out of poverty. I do not mean to demean her or Sandberg or to devalue the work they do. But becoming them is just about as unattainable as becoming a real-life Disney princess, and we should recognize that.

Research published by LeanIn.org and McKinsey in 2015 concludes that, at the current rate of change, it will be more than 100 years before we see equality in the representation of women in corporate leadership.

The technology industry alone spent a combined half a billion dollars or more on gender bias training, and it resulted in no measurable change whatsoever. Enrollment in technology majors at Stanford rose as much as 93%, but the number of women graduating from those majors dropped from 40% to 18%. The 2016 update to the LeanIn.org/McKinsey study concludes that employees are not convinced that gender diversity is an imperative, despite compelling data demonstrating that companies with women in leadership significantly outperform their peers.

Perhaps most important is the stark assertion that men and women are not having the same experiences at work; this impedes women from developing as leaders and from accessing the opportunities that will get them promoted.

The conversations we are having and the training we are sponsoring is not working to create change. Women will not pursue careers in technology, will not stay in those careers and will not be promoted into leadership positions in those careers if we continue to spend our time, energy and money on efforts we have proven will not make a difference in their experiences at work.

The companies whose leaders today decide to side-step the need to eradicate hidden gender bias, who decide to stop worrying about whether princesses are strong enough, who figure out how to inspire women to bring their ideas to the conversation and to contribute their perspectives in the innovation lab will not only benefit from improved business results but will be the beacon that draws the most talented women leaders to join them.

There are no princesses here.

What if Insurance Brands Were Marketed Like Red Bull?

Bryan Adams of @PhCreative recently wrote a great piece on the insurance brand here. Dare I say it’s an outsider’s perspective on the insurance world, provocatively titled: “Imagine if Insurance Brands Started Marketing Like Red Bull.”

He really got me thinking, and I wanted to share my perspective:

1. This is a hugely exciting idea, with lots of disruption to come, but you could argue that what we’re experiencing is evolution, in the same way that Pixar was an evolution to Disney — Disney is still about. The insurance industry is changing, general insurance quicker than life or health (as general insurance is what most of us see or experience), but all will evolve over time.

2. The insurance industry is one of the oldest; you have to go back to Edward Lloyd in 1688 to see the wonderful tradition of the coffee shops of London and how it all began. In many ways, we are returning to this tradition and bias toward the customer. It’s great to see, but many industries are doing or have done the same. Anyone want to talk about the rise or fall of bank branches?

3. We are steeped in tradition, and like many industries need to have the old guard making way over time to the new guard. We will always have the traditional guys, the new guys and the bleeding-edge guys. From life policy to telematics and so much more in the middle, it’s an exciting space. Many new CxOs are from industries outside of insurance, bringing in new ideas tried and tested in other industries that resonate well.

4. We have some amazing brands in the UK and worldwide from Direct Line, Churchill (yes, the dog), Legal & General (the bowler hat), LV=, Zurich, Allianz, Geico (the lizard), Prudential (the man from the Pru) and so much more, each with its own catchy strap line, just like those guys who are never knowingly undersold — and you know who I mean without even looking it up (for the UK guys, anyway). In fact, I think brands are one of the biggest investment areas over the last few years, and are paying off. We can engage and resonate better with a new breed of savvy consumers with a limited and reducing attention span (regardless of the product or service).

5. Our brand is key (to most folks who care). We are generally trusted, irrespective of the line of business; we are long-term rather than short-term. Can you name the brand if I said:.

  • Every day matters
  • Drive like a girl
  • With you ever step of the way
  • Redefining standards
  • Where you mean more
  • It’s about time.

These brands, to me, say core values, vision, purpose and belief. We are not a sugary soft drink; we are the guys who help when your house is flooded, when your kids have written off the car, who help you through a hospital visit, who keep you well in retirement.

We don’t want to be a sugary soft drink. And we are doing all of this without our customers really ever wanting to engage regularly with us — if they do engage, you know something is changing or, worse, has gone wrong. Apparently we now look at our phone more than 200 times a day. Your insurer, you call perhaps once a year, at best.

You could argue that this makes the brand experience even more important.

As for goosebumps, you are right: The insurance industry doesn’t sell goosebumps.

In days gone by, the insurance provider was there after the event. More recently, insurance has been there with you. Because of technology and brand disruption, insurance will be there ahead of your need — from the crashed car creating a claim, to the water leak in the office block that sensors detect, turning off the mains and notifying the insurer and loss adjuster. When it comes to insurance, I’ll pay extra to know I’m safe and will avoid the goosebumps.

Work Comp Outlook for California in 2015

The California Workers’ Compensation & Risk Conference in Dana Point opened with a session featuring employers and stakeholders in the industry weighing in on the current state of California workers’ compensation and the outlook for 2015. Panelists were: moderator Mark Walls, vice president of communications and strategic analysis at Safety National; William Zachry, vice president of risk management at Safeway; Tim East, director of risk management at Walt Disney; Bill Mudge, president and CEO at WCIRB California; Kurt Leisure, vice president of risk services/asset protection at Cheesecake Factory; Seeta Ambati , a defense attorney who is a partner at Laughlin, Falbo, Levy & Moresi; and James Butler, a plaintiff attorney with Butler Viadro.

The panel began with a look at where California workers’ compensation is today:

• California holds a quarter of the nation’s workers’ compensation business.
• To date, 80 new carriers have entered the California market since 2004.
• California is among the top three states in terms of average medical costs per claim.
• California has experienced double-digit increases in premiums over the last two years.

Cost drivers to the California workers’ compensation system include:

• A high frequency of claims handling in the state relative to payroll, with Los Angeles County having the most claims in the region.
• A multitude of expensive permanent disability claims that include attorney involvement.
• Opioid prescriptions, which have doubled in frequency.

SB 863 is California’s answer to addressing these costs, but it is too early to provide tangible data on whether the reform has been successful. Some early data shows that costs related to liens are down, but costs related to independent medical reviews (IMR) are significantly higher than expected.

Panelists were split. Some say that, although it is too soon to judge, they are seeing the following indications that SB 863 is working:

• Generally, rate increases have been cut in half because costs are showing a downward trend.
• The highest costs are coming from old medical claims rather than recent claims.
• Because this is the first time that California has experienced cost decline in quite some time, panelists thought that the cost cuts may make the state appear more employer-friendly, which will encourage companies to return.

Panelists said there are still some kinks to work out in the reform. One stated that the IMR process, which has been designed to take non-medical professionals out of the medical decision-making process, is working well. On the other hand, the opioid decision-making process in place is not currently solving the costly opioid problem. Overall, people are still learning the new process, but panelists said they think that outcomes will be positive over time. They think that the measures are in place to help get the injured worker healthy and back to work. Most on the panel felt that peer-to-peer review is the right approach and that the system is better than it was.

The California Applicants Attorney Association (CAAA) strongly disagrees, however, and views the reform as a failure that is harming citizens. A representative said that the CAAA saw more employees returning to work before the reform and that the system is averaging 4.3 medical denials per patient. The CAAA cites the cost of administering workers’ comp as one of the largest costs that a business can endure. In addition, the CAAA believes that peer-to-peer review is not working efficiently. CAAA thinks that legislative efforts to reform workers’ compensation are aiming at the worst-case scenarios, rather than the majority and, therefore, have not provided the best solutions for most companies.

Panelists were asked what changes they would make to the California workers’ compensation system if they were governor for the day. Ideas included:

• Take a fresh look at the 101-year old system, which is overloaded with rules, legislation, audits and controls. It is time to simplify a system that has layers of new rules on top of old rules and, as a result, enormous costs related to it all.
• Do away with cumulative trauma, which is a major cost driver that creates complexity. Some states have already done this.
• Make use of alternative dispute resolution. California has gone from incentives and positive reinforcement for providing prompt payments and benefits to a system focused on penalties. It needs a system that rewards promptness and minimizes disability.
• Address the opioid abuse and CURE system to make every effort to avoid addiction.
• Look at the system through the eyes of the injured worker and simplify accordingly. Employees can’t understand the current complex system, which is why they seek legal representation.

The session served as a great kickoff for the conference, providing both an overview of the current workers’ compensation cost drivers and offering suggestions for improving the system.