Tag Archives: pew research center

How to Move Into the On-Demand Economy

The rise of the on-demand economy is disrupting billion-dollar markets — from retail, travel and transportation to healthcare, financial services, insurance, cable and utilities. In fact, a recent survey by Pew Research Center found that 72% of American adults have used on-demand services.

While we’ve become accustomed to witnessing startups and digitally native companies launch on-demand services with relative ease, the reality is far different for established enterprises with legacy systems that they have to integrate. For many companies, adapting to an on-demand model requires organizational restructuring, not to mention disparate systems that need to be connected to make that possible. Often, it’s difficult for enterprises to keep pace with the changes to meaningfully transform their business for the on-demand economy.

By 2025, leading enterprises will operate entirely on-demand — using software and mobile devices to connect to global and distributed networks and using a combination of AI and chatbots to handle customer service, payment and transactions and other business processes. According to Gartner, three out of 10 jobs will be converted to software, robots or smart machines.

These realities both threaten and present opportunities for enterprises. But the biggest risk of all is for businesses is to pretend the changes aren’t happening. Enterprises need to embrace the change to both redefine their role and the value they bring their customers, all while automating key areas of their business, ensuring compliance and stimulating growth.

See also: On-Demand Insurance: Ultimately a Bust?  

The on-demand economy has raised consumer expectations across industries. It places the customer firmly at the center of a business. We’ve seen Amazon set a new standard for retail customer service. Uber and Lyft have used a distributed workforce to disrupt a $60 billion local transportation market, while Airbnb has changed the travel and vacation rental market, and Lemonade is changing the insurance industry. The elevated experiences provided by these companies, and those like them, combine to raise the customer expectations across all industries.

What’s even more interesting is what has become known as the “experience gap.” It’s based on the fact that 80% of CEOs believe they are delivering a superior experience, but only 8% of customers agree. And given that more than half of customers today say they’ve switched companies solely because of poor user experiences, it’s clear that companies that fail to embrace change and the shift to consumer-centric solutions are at a strategic disadvantage. This experience gap is the catalyst for a lot of disruption because it’s catching businesses off-guard because they’re not yet deploying the new tools that can close the gap.

As such, competition doesn’t manifest itself through traditional means. Instead, competitive differentiation stems from the quality of experiences businesses can deliver to their customers.

So that brings us to the question of “how” to deliver experiences consumers expect.

How can enterprises join the on-demand economy and deliver experiences that are synonymous with being always-on and personalized? In broad terms, there are elements or “steps” of digital transformation that enterprises can undertake to get them in the right place and ready to meet the needs of today’s demanding consumer. And, the process is not as complex as one might imagine.

Enterprise Transformation for the On-Demand Economy

1. Enabling messaging as a customer engagement channel

The first step is to enable a secure messaging system that can adequately serve the needs of consumers. This means it needs to offer all the necessary functionality that consumers experience in other channels such as payments, scheduling, CRM integrations, file transfers, customer service and marketing. In addition, the communication platform needs to meet security and privacy standards to ensure no breaches in compliance.

The fact is, traditional channels — such as telephone and email — are no longer the primary channels through which people communicate with each other. The adoption of messaging has been rapid, and it shows no signs of slowing down. With this in mind, businesses large and small need to follow suit and begin the transition to messaging by including it in their channel strategy.

The reason messaging is such a key part of the on-demand economy is that its very premise is on-demand. Messaging allows consumers to respond in their own time and send messages whenever they like. It harbors a strong sense of immediacy that’s unmatched on other channels. And it’s a channel that’s easily accessible through the smartphones that people carry with them everywhere they go.

2. Messaging across all devices and channels

This same messaging capability then needs to be plugged in effectively across all devices and channels to connect with customers in real time. So, whether the primary interface is a mobile app, website, social network or otherwise, it’s the same high-value messaging experience.

3. Scale through business process automation with chatbots and artificial intelligence.

The third step to entering the on-demand economy is scaling the always-on messaging experience through the use of chatbots and artificial intelligence (AI). These technologies work to automate the whole operation and provide a cost-effective solution for scaling 24/7 connectivity.

The future of business communication is firmly based in the on-demand economy. So enterprises must be focused on making processes easy to access and intuitive to move through. Despite all the extraneous features and services that will be enabled through technology, the biggest drivers of innovation will be utility and simplicity across the customer experience.

See also: Insuring a ‘Slice’ of the On-Demand Economy

What It Means for Businesses to be On-Demand

To be truly on-demand is to be at the beck and call of customers and consumers — to deliver experiences that provide consumers with access to information and services when and where they need it. It’s a simple concept with massive implications. Each day, consumers embark on an infinite number of journeys. For businesses to play a role in these consumer journeys, they need to meet them where they are along the way. And that is the the premise of the on-demand economy. Businesses no longer have the control — consumers are the ones who are empowered. It’s therefore essential that businesses adopt the on-demand model to retain and build their customer’s loyalty.

Restoring the Agent-Client Relationship

There has been a lot of frustration in the insurance industry from both those who sell it and those who need it. Both camps are suffering financially, and both can do better if they get together on vital insurance protection, but they just can’t seem to hook up without jumping through hoops. In an era of hyper-information and instant communication, this disconnect may seem crazy, but it’s real. In a time of chaotic change, an online meetup service would be valuable to agents and consumers alike to repair that agent/client relationship and put the personal touch back into insurance.

Financially challenged agents and consumers

Incomes have stagnated for insurance agents and the general public alike, and the route to better times seems unclear for both sides. According to the U.S. Bureau of Labor Statistics, the mean annual salary for insurance sales agents inched up only 2% between 2010 and 2014. In 2010, it was $62,520.  In 2014, it was $63,730. Furthermore, the field has become overcrowded, with 18% more agents vying for the business in 2014 than in 2010.

The general public has fared no better. Following the Great Recession, which began in December 2007, the wealthiest Americans have done well. The “rest of us,” however, continue to struggle. The proportion of American households defined as “middle-income” remained stagnant from 2010 through 2014, at about 51%, according to a Pew Research Center study. Back in 1970, the “middle-income” percentage was 10 points higher.

The potential for pocketbook improvements

Both insurance agents and their prospects could do better financially if they could somehow get together more quickly and smoothly – through a matchmaker or intermediary.

It’s easy to see how agents could profit. With, say, a 10% to 50% increase in qualified leads per month, a corresponding jump in income could be expected. And with other efficiencies through more nuanced matchmaking, even greater income increases might be forthcoming – through enhanced referrals, for example.

It’s a little more complicated to see how connecting more smoothly could financially benefit insurance buyers. It becomes clear, though, when one goes to the heart of what insurance is for.  It’s for mitigating risk, which can be expensive. It also means personal benefits such as improved health and well-being. For example, good guidance from an agent can:

  • Make the difference between paying and not having to pay for home repairs after a type of storm damage not covered by an “economy” policy the agent advised against.
  • Preserve a family’s estate by convincing the family, early on, of the prudence of securing long-term-care insurance. This could be a financial game changer for millions of families that are now exposed. According to industry estimates, about 90% of those who could benefit from LTC insurance do not own a policy. And one of the biggest causes of bankruptcy is uncovered health expenses, especially in the later years!
  • Help keep clients safe and whole through an auto policy with safe-driving incentives. The potential benefits range from lower premiums to higher lifetime incomes because of avoiding accidents that might interrupt the ability to work.

As technology and society evolve, good guidance from an insurance agent may affect people’s pocketbooks and lives in more significant ways than ever. More and more agents can:

  • Team with financial advisers to foster sound budgeting, savings, investments and money management.
  • Influence their clients’ health by recommending policies, now starting to appear, that come with fitness incentives. The financial win here is double: lower premiums for keeping up one’s wellness routine and greater lifetime earnings through enhanced vitality and work-span.

The matchmaker solution

A good matchmaking service brings insurance agents and buyers together in very efficient, human ways. It starts with search and ends with introductions and contact.  It includes:

  • A search function to locate agents for a particular type of insurance (auto, critical illness, health, homeowners, life, long-term care, Medicare supplement) in a particular geographic area.
  • A list of agents with their pictures and names visible, for the buyer to peruse and select from.
  • Details about each agent, including:
    • Insurance lines and carriers represented.
    • Agent’s biography or background description.
    • Reviews or testimonials with ratings (usually one to five stars).
    • Link to the agent’s personal or business website.
    • Other information ranging from a location map to social media links.

Limited matching has existed for a few years. Some generic consumer rating and matching services embrace insurance agents. They include Yelp and Angie’s List. General search services, such as Google and Bing, serve as de facto matching services, but in a very spotty way. Insurance associations develop leads that are sold to agents but do not typically provide free online access to individual agents.

Robust agent-buyer matching, with all the above elements, is ready for prime time. In 2015, Agent Review, the first complete rating and matching service designed specifically for insurance agents and insurance buyers, was introduced.

No Vaccine for Social Media Theft

Whether you are new to college, single and dating or newly divorced (because you panicked and confessed when news of the Ashley Madison hack hit the media), I’ll bet there is at least one socially transmitted disease you haven’t started worrying about: identity theft.

If you use Facebook, you’re making easy work for identity thieves. The same goes for the whole cosmos of social media whether you favor Twitter, Instagram, Reddit, Pinterest, YouTube or LinkedIn or prefer to Tumblr your thoughts, preferences and predilections to anyone who cares to know what they are. The more you put out there in publicly viewable spaces, the more your personal identity mosaic is exposed. An identity thief’s day job is piecing together that mosaic into a passable, or usable, version of you: one that will get through the authentication process of financial, medical or governmental organizations.

The echo of another kind of disease here is intentional. Like the more widely known kind of STD, the socially transmitted diseases that fall under the rubric of identity-related crimes are contracted by unsafe personal information practices. Unlike the more familiar variety, where safety is taught in high school, tacked to college community boards and heralded by countless other media new and old, not as many people these days know how to stay as safe as possible from the threat of identity theft, especially online.

How to practice “safe social”:

  1. Don’t overshare. It’s okay to let the world know you’re on vacation so long as you have a great security system at home or you have a house sitter. Traditional trespassers use social media to know when houses are unguarded. It is far better to share the memory than report the experience as it’s unfolding.
  2. Be careful when posting pictures. While it’s fun to brag about a purchase—whether that be a diamond ring, a car or the smartest TV on the market, just be aware that anyone following you now knows where they can get your newest trophy or indulgence for free.
  3. Geotagging is for victims. There is no upside for you here. Companies like geotagging photos and other people-powered media assets because it gives them bankable information that could lead to future sales. Whether you are letting Twitter or Facebook or FourSquare narrowcast (or broadcast, depending on your privacy settings) your location, failure to disable location services on your device permits geotagging, which also gives thieves bankable info that could lead to future crimes.
  4. Know your privacy settings. Make sure you understand how your posts are being displayed or distributed by the social network you use. For instance, on Facebook you can set a post to “Public” or “Only Me,” with many choices in between.
  5. Lying is good. Facebook, especially, is a perfectly acceptable place to not be forthcoming about your age, hometown, place of employment or even the college you attended and what years you were there. Identity thieves comb social sites for information to complete dossiers of personally identifiable information that will allow them to correctly answer security questions and thus open new financial accounts or empty existing ones. If you don’t want to actively fabricate answers to these questions, just don’t fill out those parts of your profile.
  6. Beware of quizzes that require personally identifiable information. Make no mistake, your email address and name count.

There is no immunization

Unlike the other kind of STD, the socially transmitted disease of identity theft is not avoidable. There is no immunization, no safe way to avoid it—not even complete abstinence. There have been too many breaches with too much data for anyone but those living entirely off the grid to be completely safe. (And even still you can’t be sure.)

Your best bet, in my opinion, is a system detailed in my book (forthcoming in November). A key element to that approach is acceptance. Specifically, you need to come to terms with the fact that it’s no longer a question of “if” but “when” you will become a victim of at least one type, if not multiple types, of identity theft. Anyone who tells you that they can keep you from getting got is selling snake oil. In fact, they are running afoul of the Federal Trade Commission. There is no guarantee. There are, however, best practices.

THE THREE M’S

If you accept the basic premise that you are at risk for identity theft no matter what you do, here are some thoughts as to how you might stay as safe as possible. The good news may actually be that you are a seasoned and intelligent user of social media, because that means you already have several of the habits in place that you will need.

Minimize your exposure

The same strategies you can adopt to make yourself a harder-to-hit target on social media go for the rest of your life. Whether that means saying “no” when asked for your Social Security number, limiting the amount of sensitive personal information you provide to anyone who contacts you, making sure all your accounts (email, social networking, financial or retail) have different user names paired with unique, long and strong passwords, properly securing your computers and mobile devices or freezing your credit—there are a variety of things you can do to make your attackable surface smaller.

Monitor your accounts

If you use social media regularly, you are used to checking in on a regular basis—the Pew Research Center found that 70% of Facebook users check in daily, as did about half of Instagram users, and nearly 40% of Tweeps. The same behavior, applied to your financial life, may keep you from getting got … or help you undo or minimize the damage in case you do. Check your bank and credit card accounts daily. Other things you can do include signing up for free transactional monitoring alerts at your bank, credit union or credit card provider, or purchasing more sophisticated credit and noncredit monitoring programs.

Manage the damage

When the dark day comes that your daily practice of monitoring your credit or financial life yields a compromise, you need to get on it immediately by informing the institution of the account that is involved, as well as law enforcement and the fraud department of at least one credit reporting agency. Because many insurance companies, a number of financial services organizations and the human resources departments at a number of companies offer complimentary or low-cost identity theft assistance as a perk of your relationship with the institution, check to see if you are covered or, if not, how you can get covered. Resolution experts can greatly help you speed your way back to normalcy.

Identity theft is a permanent threat. The best way to stay safe is to change your behavior. The above tips are only some of the ways to do that. In the age of universal data vulnerability, practicing safe information hygiene is a must—lest you contract the one STD that may haunt you for the rest of your life.

Data Breach Law Could Hurt Consumers

With each passing brand name mega-breach—Home Depot, Target, JPMorgan Chase, Anthem—it becomes ever more urgent for government and industry to get on the same page about how to protect consumers.

Sadly, not all laws are created equal, and there are few better examples of this homespun truth than a would-be federal law currently wending its way through Congress. The Data Security and Breach Notification Act of 2015, in its current form, has a long way to go before it should become the law of the land.

The Data Security and Breach Notification Act of 2015 says it “aims to tackle the nation’s growing data security threats and challenges.” So far, that sounds pretty good to me. The bill was written by Energy and Commerce Committee Vice Chairman Marsha Blackburn (R-TN) and Rep. Peter Welch (D-VT), making it a bipartisan effort. The goal: to implement “a comprehensive plan to help safeguard sensitive consumer information and shield Americans from the harmful consequences of cyber attacks.”

I’ve written elsewhere about the need for a federal breach notification law, so in theory I’m on board. A strong federal law that requires businesses and government entities to inform people that their personal information has been compromised in a data breach can absolutely be a good thing…if it’s done right.

The problem with this proposal is that there are far more effective laws already on the books in several states, and they could be preempted were the bill to pass. If that weren’t bad enough, the proposed bill could also supersede stronger rules already put in play by the FCC with regard to telephone, broadband Internet, cable and satellite user information.

The undermining of better laws is bad, but worse is the way the Data Security and Breach Notification Act of 2015 underscores a continuing failure of our leaders to fully understand the nature of the problems we face in the mare’s nest that is consumer privacy and data security. In a widely publicized survey conducted by the Pew Research Center, “91% of adults in the survey ‘agree’ or ‘strongly agree’ that consumers have lost control over how personal information is collected and used by companies.” Data breaches, and the identity theft that flows from them, have become the third certainty in life. We need a strong federal law, but as I argued in my op-ed about the Data Breach Disclosure Box, any proposed bill that threatens to weaken existing laws has to be challenged, quickly and without equivocation.

Why It’s an Issue

Senior Policy Counsel at New America’s Open Technology Institute Laura Moy eloquently outlined the problems this bill could create in her testimony before the House of Representatives.

In a wide-ranging discussion of the major concerns raised by the bill, Moy pointed out some of the laws that could be preempted. One was California’s Song-Beverly Credit Card Act, which made it illegal to record a credit card holder’s personal identification information during a transaction. Another law in Connecticut outlawing the public posting of any individual’s Social Security number was also named. Both state laws represent solid advances in the realm of data security, and both might be preempted were the bill moving through Congress to succeed.

And here’s the really bad news: they would be two of the less alarming casualties.

The problem with the bill hinges on the way that it tries to separate privacy from data security, but they are inextricably intertwined. This could weaken or even eliminate protections for the many kinds of information – like your email address, for one — that fall outside the bill’s narrow definition of the personal data that is covered. That’s why this matters so much.

As Moy argued during her testimony, “Many laws that protect consumers’ personal information [can] be thought of simultaneously in terms of both privacy and security.” I will go one step further and say that I do not believe it is possible to discuss data security until we have a worst-case scenario definition of what constitutes personally identifiable information in the eyes of an identity thief.

To give an example of the kinds of preemption that are possible here, Florida’s privacy law includes email and a consumer’s username-password combination in its definition of personal information, the logic being that consumers use the same combination for many different login pages, including financial accounts. Eight other states currently mandate the same standard—California, Missouri, New Hampshire, North Dakota, Texas, Virginia and, as of July 1, Hawaii and Wyoming. Under the currently proposed bill, a business would not have to notify you if your email and username-password combination were involved in a breach. Meanwhile, the above kinds of information continue to be highly exploitable data points in an identity thief’s toolkit.

In addition to the exemption of breaches that “only” include email addresses or user login details, the bill is unclear about personal information related to telecommunications, cable and satellite customers, which hinge on a trigger of “authorized access,” and Moy believes it may supersede important protections created by the Communications Act. Most alarming is the prospect of less robust notifications regarding compromised customer proprietary network information (CPNI) – that includes texts, phone calls, every location where you were when you made this or that phone call, your location when you didn’t make a phone call and the location of all your network-connected devices. All this information could be breached, and this proposed law in Congress says you don’t need to know about it. The same goes for what you watch on television, including any items you may have purchased on pay-per-view. All of it could, hypothetically, be out there open to public perusal. Every site you ever visited on line. Every call. Every text.

And what about your protected health information (PHI)? Critics note the bill doesn’t mention it, which at first blush seems like a four-alarm-fire level of non-comprehension. However, whether the product of partisan warfare or common sense, it’s actually a bit of good news. Because it has been entirely carved out here, most forms of PHI actually would still be covered by the notification requirements of the HIPPA/HITECH Act — with a few notable preemptions of existing state law affecting over-the-counter purchases and other health-related items.

Defining Harm

According to the narrow logic of the proposed legislation, a breach of any of the above information will not result in financial damage, which is the reason it isn’t covered. It’s a position easily brushed aside with one mind-blowing word of refutation: extortion. Scam artists have countless tricks up their sleeves, and the onus to anticipate the adaptive nature of crime falls on legislators. A single text or rented video could potentially ruin a person’s life, and fraudsters know that. If the wrong person has access to the above data points—and any of those bytes contain information that might harm you professionally or personally—they most certainly could be used against you for financial gain.

A recent Science study showed that with just a few data points (Instagram posts and tweets) it was possible to re-identify anonymized data about credit card purchases with the unique consumer who made them. While it may seem off the beaten path, the proposed bill, with its narrow definition of what should be covered, would not cover a glitch in Instagram’s code that revealed protected accounts to the public. For the end user unaware that their private posts were viewable, and that those posts could be used to re-identify data that is publicly available, the above hypothetical scenario featuring a “financially harmless” compromise (that revealed every purchase made on an individual’s credit card) could be a life changer—and not for the better.

What we really need in the federal government is someone in a position of authority with the expertise and knowledge to make sure anyone exposed in a breach knows about it, and is informed about the potential fallout as far as current intel permits as quickly as possible. Call this person a Breach Tzar, if you will. Since data-related crimes are often quite ingenious, isn’t it best to err on the side of caution? The fact is that any federal law aimed at protecting consumers from the danger of identity-related crime needs to be best-in-class, and far better than all the existing state laws combined, and, while it should go without saying, it must not supersede stronger existing protections afforded by non-state agencies.

There is still a yawning gulf between what’s been done so far and what needs to happen in the realm of cyber legislation. The protections we deserve are a work in progress, one that the entire constellation of consumer advocates and data-security experts must solve in concert. In the same way that data-related crimes are constantly evolving, we need to get into the habit of responding to the very biggest picture we can imagine.

CMS' New MSA Toolkit for Self-Administration

The Achilles heel in Medicare Set-Aside compliance in workers' compensation settlements has always been self-administration. For cases within the CMS' “review threshold,” carriers and self-insureds have procured Medicare Set-Aside allocation reports at no small expense. They file for CMS approval, insisting that settlement documents provide for separate set-aside funding. Then, in 99% of the cases, the money is turned over to the claimant with little or no direction other than to go forth and administer your own set-aside account.

Most of us would be unable to keep track of the moving target of which medical goods and services Medicare will pay for. We’re not so good at submitting annual reports, either. According to the Pew Research Center, only about a third of Americans even prepare their own tax returns. Yet, insurers and self-insureds leave themselves open to Medicare Set-Aside reimbursement liability by trusting that the injured workers will be up to the self-administration task.

Finally, CMS has seen the problem and done something about it. On March 21, 2014, CMS published a Self-Administration Toolkit for Workers’ Compensation Medicare Set-Aside Arrangements. This booklet guides the self-administering former claimant through the steps, which are numerous and not all easy.

For many on both sides of the negotiating table, review of this booklet may be the deciding factor in choosing professional administration. The problem is that many settlements are too small to make custodial administration cost-effective. Some carriers and third party administrators have access to the Medicare Secondary Payer Charitable Foundation, which provides no-cost professional administration. Its account starting minimum is $25,000. Parties should check on the availability of this option before finalizing the settlement.

The purpose of Medicare Set-Asides is to prevent a double-dip: The U.S. taxpayer should not be paying medical bills for which the claimant already received advance payment through insurance. Publication of the toolkit is an important further step toward that goal.