29 minute read
Find out what our editorial board panel of experts have to say in this edition of Modern Insurance Magazine
The Future Expert
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As someone with a seemingly endless desire to learn, I have loved the opportunities presented working in insurance. If I am honest, I have also very much enjoyed being regarded as a bit of an expert in various things, it’s a nice feeling when people come to you for guidance on an issue. It really does add to your job satisfaction. So, will all that be out of the window in the future? Will machines replace the need for years of service and study, taking away that opportunity for improved self-esteem?
The answer is yes, to a degree. Surprisingly, it’s something I am pleased to see. Our industry has lost masses of experience and expertise over the years, and the trends are that this will continue. Intelligence systems powered by AI are undoubtedly the future. Imagine the benefits of having an ‘old fashioned’ expert floating around a call centre to answer your new recruits’ every query – new systems can go one better. You don’t even need to ask the expert the question, they know what you need to know and present it to you instantly whilst still on the call.
So, who or what will be the expert of the future? Those systems, obviously. But let’s not forget that someone needs to populate them in the first place, so maybe the system is just a way of distributing and supercharging their knowledge?
I have another view. Some people say that learning is just changing what you know, to me it’s more than that; it’s not just having knowledge, it’s knowing how to apply it in real circumstances. So, my definition of an expert in the future will not just be those loading information into intelligent systems, it will be those of us taking advantage of those systems and being able to adapt, modify, make pragmatic decisions, and deliver for our customers in the real world. Not a world of ‘computer says no’, but one where the computer works in tandem with the human expert, which sounds quite a satisfying approach to work to me!
David Williams, Managing Director, Underwriting & Technical Services, AXA Insurance (UK).
Business Agility to Mobilise Ability
We all know that businesses must embrace change in order to survive. Gone are the days when sticking to a single core competency was enough, when big companies dominated and locked down distribution channels to protect their key strengths.
Today, change, complexity and uncertainty are prevalent - making the rate of change faster than ever, as markets fluctuate and dominance is fleeting. There’s an irony that today’s only stability in sustainable advantage is business agility; the ability to nimbly adjust to, and take advantage of, market and environmental opportunities.
Here are three reasons to pursue business agility to create heightened stability:
Your customers expect it. In a world of instant-gratification, where customers are no longer satisfied with the status quo, an agile framework provides the tools to lead change in a productive and cost-effective way in order to satiate customers’ appetites. Rapidly responding to customer demands, and doing so with flexible solutions, is essential to delivering an outstanding customer experience which delights and retains customers.
Think about the way the Uber app disrupted the traditional black cab market. Work quickly or customers will go elsewhere. If you don’t, your competitors will. Agility is your tool to outperforming your competitors, who are slower to act when customers await innovation and evolution. An agile business deftly manoeuvres market change, nimbly adjusting to and taking advantage of market opportunities, whether adapting existing services or moving the entire industry forward.
Consider Blockbuster and Netflix – if you can’t act quickly to fill the gap, your competitors will.
Standing still is not an option. Business leaders yearn for ongoing stability and a future that is clearly laid out before them, yet the world no longer works in that way. Landscapes are moving and businesses must bend, pivot and change to adjust to powerful market forces and internal business change. This requires entirely new ways of thinking which are both original and ground-breaking.
Amazon competed with traditional retail models; introducing lean manufacturing techniques to product ordering and shipping, whilst adding value on a colossal scale. Their impressive growth is a direct result of thinking differently. And their legacy? The ongoing evolution and disruption of the face of consumer buying, and a huge dent in the backbone of our economy - the high street.
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Human and/or Machine?
Insurance is a low engagement purchase for many, especially motor insurance. Policyholders frequently avoid reading the policy details, they make assumptions and don’t take time to consider what the cover actually provides. This lack of understanding extends further by the infrequency that a policyholder makes a claim. It’s a distressing situation - which doesn’t occur very often - using a service that the person didn’t pay much attention to when they bought it!
Helping navigate all of these concerns is most definitely a person to person experience. Whilst consumers happily defer to technology more and more, preferring self-service checkouts to actual people for example, an insurance claim is a very different interaction. The distress or crisis, coupled with the lack of understanding, makes that personal reassurance so important.
However, that doesn’t mean that what our claims people are doing hasn’t changed already. For me, it’s a question of bringing the best of both worlds; harnessing the efficiency and accuracy advantages of technology with experienced claims people to drive a better customer experience and better commercial outcomes for the insurer.
One of the ways we’ve done this within motor claims is by considering first call resolution. With the objective of resolving the customers’ needs within the first contact, what information do we need or what processes should we follow so the customer won’t need to contact us, or another party, within the claim again? It’s a powerful tool for designing processes and technology in claims.
This approach sets a framework by which technology is used to help us answer questions and gain understanding as quickly as possible within the claims journey. Data can be organised and interpreted by AI, but that doesn’t replace the value a person brings; it enhances it.
It’s not a case of one being better than the other - human or machine. It’s about designing systems that bring the benefits of both to make efficient, empathetic decisions to minimise the disruption for the customer, and drive down costs for the insurer.
Jason Tripp, Managing Director, Coplus.
Excellence in Customer Care
The industry’s core mission at the moment is improving customer care, how will new job roles (Head of Innovation, Synergies Director, etc.) be facilitating excellence in customer service? The big customer retention battle is undoubtedly exercising the minds of many in our industry. As the focus is ever-more honed to ensure every aspect of the customer experience is examined and improved, there’s a need to ensure the right people are ‘owning’ that challenge. It is heartening to see that many insurers are bringing in new experts who understand what motivates a customer to stay – or go – following any sort of interaction. Once you get beyond the price, the claims journey is front and centre when it comes to understanding what makes a customer want to stay or leave a motor insurer. Everything from the FNOL, to the options offered to get a policyholder who’s been involved in an accident moving again. One area where customer satisfaction could be enhanced – particularly in relation to the claims experience – is by offering more mobility options to the policyholder when their car is off the road. That must start right from the get-go. Surely a customer who is offered a private taxi hire back home or on to their destination is going to feel more cared for – and less stressed – than being offered a seat next to the vehicle recovery driver in his cab! It should also extend to the mobility options offered while the vehicle is under repair or being replaced. Think about those living in urban conurbations who may well have chosen the engine size of their car based on local parking and congestion rules. If they suddenly find themselves in a car that isn’t of the same spec, could they face fines or increased parking costs? Don’t forget the growing electric revolution! Early adopters of EVs are passionate about their choice. They probably made it for ethical as well as economic reasons. So how will they feel if the replacement vehicle they’re offered isn’t electric... and maybe even diesel! There are definitely barriers that the insurance sector needs to overcome to adopt a more flexible, choice-driven approach to replacement mobility. A key challenge is creating a supply chain that can fulfil multiple needs - that probably means widening the supply chain rather than sticking to a sole-supply model. But with a new generation of experts entering the sector, I firmly believe these barriers can and should be overcome.
James Roberts, Business Development Director, Insurance, Europcar Mobility Group UK.
Bridging the gap - how automation is changing the future of motor claims
Vehicles of the future are just around the corner - fully automated with little or no driver assistance - and many predict that they will significantly reduce, if not eliminate, motor claims as we know them. What do we need to do as an industry in the meantime, to cope with the existing mix of unconnected, intelligent and autonomous vehicles?
The human behind the wheel is the most unpredictable thing in a vehicle. In 2018, more than 80,000 crashes occurred in the UK due to human errors: suddenly braking, poor manoeuvring and loss of control 1 .
Many companies are already using telematics or black box technology, which monitor individual driver behaviour and can help to reduce premiums. Others are using dash-cams, which provide crucial evidence in determining cause and liability. However, we need to proactively reduce the number of incidents and speed up the process once a collision occurs. There is now a space for AI to bridge the gap. Through black box and/ or cameras, predictive analytics study driver behaviour, meaning that poor behaviour can be addressed, preventing motor incidents before they occur. Drivers, fleet managers, risk managers and insurers can receive alerts or reminders about bad driving, further reducing the risk. Alongside this comes automated first notification of loss (FNOL). Using the technology already in vehicles, when an incident occurs an alert is triggered automatically with the claims team. Not only does this eliminate delays in accident reporting and helping the driver in an emergency, it reduces claims spend. The earlier a claim is notified, the more likely the claims handler will capture third party details and guide them through the claims process. Sedgwick recently announced its partnership with Concirrus, the creator of Quest Automotive, a big data analytics platform designed to improve insight into risk for the motor insurance market. This partnership is the first-to-market proposition for predictive analytics and automated FNOL in motor claims, giving fleet managers, risk managers, drivers and insurers a greater understanding of driver behaviour and risk. Through adopting solutions like these, the industry can navigate the gap between traditional motor claims and the very different future of automated vehicle claims. Stephen Bevan, Client Director, Sedgwick International UK.
1. Department for transport - Contributory factors for reported road accidents (RAS50) https://www.gov.uk/government/statistical-data-sets/ras50-contributory-factors
Lenders’ Finance Agreements
Since the end of the British Bankers Association/ Association of British Insurers Bank Agreement in 2012, we’ve seen a sharp increase in the number of requests for bespoke amendments to policies at the request of lenders. These are creating challenges for insurers and brokers, due to the complexity and nature of these requests.
When a property or business owner approaches a financial institution for finance or re-finance, the lender will often require a method to secure their interest in the individual property or business. Part of the finance agreement for the loan may require the lenders interest to be secured in the borrower’s insurances. The request from the lender usually takes the form of a letter which sets out various obligations and requirements, including confirmation that the insurances are set up in line with the facilities agreement. It’s the facilities agreement which contains the detail about how the borrower’s insurances should be arranged.
It’s unlikely that a standard insurance policy will meet the facilities agreement requirements. Therefore, in order to receive the loan, the borrower’s insurers may have to make amendments to policy coverage.
WHAT ARE LENDERS ASKING FOR? Lenders are asking for a variety of methods to secure their loan. These range from the non-invasive ‘Noting of Interest’ where the lender’s interest is recorded in the policy document, to ‘Policy Assignment’ where a whole policy is assigned to a third party and the insured loses all rights, but would still need to pay the premium. Policies can also be adapted through ‘Non-Invalidation/Non-Vitiation’, meaning that a policy remains in force even if the insured breaks their policy conditions. Composite policies are also sometimes requested, which enables both parties to make independent claims for the same loss and the policy would pay twice. WHAT CAN BROKERS DO TO HELP? • Understand the potential implications of lenders agreements, and make customers aware well in advance of completing any significant financing/re-financing. • Explain the complexity of the situation and explain that there may be an additional charge if the insurer is widening cover at the lender’s request. • Remember existing clauses and agreements at renewal, particularly if changing insurer. Some brokers are pre-empting issues by ensuring their client’s lenders are advised upfront of what their insurers will/won’t accept. For now, the situation continues to evolve. Increased understanding in the market is vital to ensure all parties to the contract fully understand the implications. Further details on the variety of methods and implications are available on allianz.co.uk/broker Paul Higham, Head of Property Insurance, Allianz.
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Training the Next Generation
As the claims industry addresses the shortfall of talent in its ranks, the training of the next generation of experts has never been more important. The Crawford Academy, launched on 1 st January this year, aims to equip this next generation with the skills to progress their careers and handle increasingly complex claims.
One of the top challenges we face is the aging profile of senior adjusters across the claims sector. There are a significant number of loss adjusters across the sector who are aged 55 and over, meaning that many of our most technically competent people will leave the loss adjusting arena in the coming years. The demand for high quality claims expertise is outstripping supply, and this problem is here to stay. At the same time, the nature of the business continues to evolve, and insurers increasingly expect a higher level of expertise from their claim managers. At Crawford, we are handling bigger and more complicated losses all the time. Meanwhile, rapid changes in the risk landscape mean the nature of the claims we deal with is evolving all the time. The adoption of new technology, for example, will drive different outcomes for our clients and Crawford itself. Therefore, it is essential that we develop a deeper breadth of expertise across our industry to meet these demands. In our Major and Complex Loss team at Crawford, for example, we have recruited 24 additional adjusters, surveyors, loss mitigation experts and claims specialists just over the past year.
Preparing future leaders. People are our biggest asset and we want to build on that as much as possible. On 1 st January, we launched the Crawford Academy to upskill our people, encourage career progression and enhance performance.
Millennials will change jobs every five years on average, but as Crawford is a very diverse business, we want those employees to make their career changes within our organisation, rather than moving elsewhere. Giving our people the skills to move from one team to another is a primary goal of the academy. Trainees will receive technical training, one-to-one mentoring from experienced adjusters and take part in accompanied site visits. They will get the opportunity to be involved in some of the largest losses we deal with - the kind of claims that make the news - and to be part of the teams that deal with those losses from cradle to grave. We have some of the best loss adjusters in this profession, and they have committed to passing their skills down to the next generation, creating a real legacy for Crawford and the claims business we’re in. Alister Jupp, Head of Crawford Global Technical Services, UK.
Expertise and AI
Since ancient times the insurance industry has always relied on its expertise. The Ancient Babylonians, who granted loans to merchants that didn’t need to be re-paid if their shipment was lost at sea, built a career on their knowledge and understanding of risk. I’m certain however, that even in 3000 BC there were Babylonians who were concerned about the potential threat to their livelihoods from the innovation of others!
Snapping to the present day, we’re witnessing a global proliferation of emerging technologies, such as Artificial Intelligence and automation, which bring with them huge benefit but could also be viewed as a threat to the work currently performed by our people. This is a simplistic view, as when this technology is deployed correctly and augmented with powerful data, it can substitute and replace the very simple and time-consuming manual tasks that steals time away from specialists. The outcome benefit is two-fold; faster and better decisions are being made which fully utilise the expertise of the individual. Taking what we do at ControlExpert as an example, our core philosophy is that this combination of both artificial and the human intelligence of our ‘experts’ is a true recipe for success. Rather than taking a ‘man versus machine’ approach, we leverage ‘man and machine’ via Artificial Intelligence and other emerging technologies acting as tools in an expert’s arsenal, which quickly guide them to the areas which deliver disproportionate value and benefit to our partners.
The effects and benefits of Artificial Intelligence in the insurance sector are already visible. The insurance professional of the future will not be replaced by a machine, but they will harness new talents - which will naturally come from being part of a ‘digital by default’ generation. Their backgrounds and qualifications in Tech will become the new standard as companies adopt higher levels of AI and automation.
As a result, a technical insurance specialist of the future will be flexing a completely new set of skills, making them far more effective for their customers and finally freed from the boring tasks which will thankfully be consigned to the pages of history books.
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Where does human knowledge fit into the future of the claims process? Will it become immaterial?
From everything we read or hear, it does sometimes appear as if we are on the path to making humans largely redundant from the claims process - except for those gifted technical wizards who will programme and keep the machines running.
Artificial intelligence will fundamentally change all our lives. In the insurance market, AI will be utilised for better customer service and improved chatbots, data crunching to improve risk assessments and quotations and auditing to reduce claims in the first place. From FNOL systems with the ability to download telematics data/dashcam footage, to metadata used to identify incident information such as GPS coordinates - AI is rapidly becoming a core element of the market. We are all going to be using voice analysis for automated fraud checking, as well as speech recognition for identification and DPA checks.
Before we completely write off us poor human beings, it is worth considering the differences between machine and human intelligence. Quantum computing and deep learning may be at the forefront of scientific development, but it is all a relatively basic principle: if you can break down a task into data, machines using AI will be able to learn it. The problems come when you ask the machines to think in the abstract, by applying common sense or transferring knowledge gleaned from one area to another. Self-driving cars are still struggling to replicate human experience of driving despite having driven tens of millions of miles. Machines may win at processing vast amounts of data, but humans are vastly superior in making informed, abstract decisions based on instinct, common sense and little information. They each function completely differently and so should complement one another rather than one cancelling out the other.
Frictionless claims made digitally and with fewer human checks will pose a major challenge. With the digitalisation of fraud in the new claims process systems, aided by undue political haste and a lack of forethought in their conception, humans must still have a central role. Technology-based solutions will play a major role in combatting fraud and enhancing the customer experience, but the thinking human being will still be needed to provide common sense checks, empathy, expertise and knowledge.
Donna Scully, Director, Carpenters Group.
Will the constant tech evolution dictate what makes an ‘expert’? Will experience be enough?
Commitment to meeting the requirements of new and ever more complex vehicle technologies is a fundamental requirement of any expert in the automotive repair supply chain. However, whilst continual investment in technology, training and infrastructure is essential, developing close and wider partnerships is critical to providing a truly expert service. Stakeholders need to look further afield for these partnerships than they may have done traditionally. Everyone involved in the automotive sector, from insurers to vehicle glazing specialists, needs to have access to better and more comprehensive information on individual vehicles in order to deliver a cost-effective service. The rapid changes taking place in vehicle technology make it virtually impossible for any one organisation to keep up effectively on their own. Partnerships and shared knowledge are now more important than ever. National Windscreens, for example, have developed close partnerships with vehicle manufacturers, insurers and industry organisations such as SMMT and Thatcham. These allow us to use our expertise to influence future developments, and put us in an ideal position to invest in remaining ahead of the technology curve. One such example is a system developed by National Windscreens that identifies the exact glass required and if ADAS (Advanced Driver Assistance Systems) are fitted on an individual vehicle, with 99.5% accuracy. This ensures that we get the right glass first time - avoiding any wasted appointments - and can advise if time needs to be allowed for ADAS camera calibration following a windscreen replacement. We use this information as part of an ‘expert’ planning process, allowing us to undertake windscreen replacement and calibration during the same appointment, ensuring the most timely and cost-effective approach for the policyholder. With increasing vehicle complexity demanding higher levels of technical competence and the more stringent standards on compliance in virtually all areas – from health and safety, to working practices, to materials and personal data – we will undoubtedly see consolidation in the ‘expert’ supply chain. Smaller suppliers will increasingly struggle to meet the level of investment needed to deliver the required standards, and this will inevitably lead to a fewer number of suppliers offering a greater depth of capability. Experience alone will certainly not be enough to be an expert in this sector! Lisa Pugh, Business Development Director, National Windscreens.
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The insurance industry is entering a new world. With so much technological change going on, it’s clear that insurance providers are going to be placing a premium on employees with digital expertise.
Automation and customer self-serve, means there is going to be a decreasing need for human intervention, which will arguably remove some of the lower levels of claims positions, such as junior claims handlers.
Through our LexisNexis Risk Solutions research, the “Future of Claims” study shows consumers are actively seeking greater levels of self-serve and a more seamless claims experience, at the same time as trust, personalisation and timeliness.
Artificial intelligence and machine learning are coming into the claims world to build these efficiencies. However, these technologies require more data and new sources of data to be effective. AI and automation is growing, but the technology isn’t fully utilised yet, meaning more jobs will change in the years ahead.
The drive to implement predictive or prescriptive models is only going to increase, and it will occur in the context of the current shortage of data science skills. Other technology trends such as the connected car, smart buildings, electronic sensors for risk mitigation, increased preferences for self-service when claiming online and the rise of automated claims logging and settlement - are all going to have an effect on the required skills.
Part of the solution to this re-skilling of the claims function is, of course, going to come in the form of finding new ways to attract the young tech talent of the future. With existing staff, there’s a need to encourage learning and ensure the new paths of career progression are clearly identifiable.
Putting better data in the hands of claims teams is going to be key to driving towards a better claims experience and faster verification, with the ultimate goal of the genuine ‘one-click’ customer experience. Given the number of people who work in the claims space, automation and machine learning will remove a lot of the mundane from claims handlers and will really give insurers the opportunity to focus on great customer service, at one of the most stressful points of contact for most individuals.
I believe the claims department of the future is not only going to be leaner, but more proactive, more data-driven and higher-skilled, than ever before.
Alan O’Loughlin, Director, Statistical Modelling, International Markets, Insurance, LexisNexis Risk Solutions.
Is there any advice you would give to young starters in the industry?
Firstly, working in automotive glazing is an amazing career with massive potential to develop and progress within the insurance industry. I started with Auto Windscreens as a trainee technician in 1992. I am proud to say it made me who I am today - our fabulous training academy and the experience I gained provided me with the opportunity to extend my knowledge of the market, the company and our customers.
In recent years we’ve seen new technologies and innovations shape what we do, but despite all of this, one thing remains unchanged - the human touch. For me, it’s about having honesty, integrity and getting back what you put in - most of all, it’s about people. No matter what skillset a young employee has, there’s training available to bring them up to speed. I’d recommend they get to know their product inside out and focus on service. I’d urge them to listen to mentors and those around them, because they have the experience to draw on. Keeping your eye on the marketplace and ‘what’s next’ in the industry is vital. But it’s the ‘here and now’ that’s important to today’s customer and in the face of such change, a knowledgeable, reassuring and friendly voice goes a long way. As I’ve worked my way up through the ranks, I’ve been appreciative of the fact that a car is the first or second most expensive item people own. Whether I’ve worked on a basic popular model, or a top-end Ferrari, I’ve been focused on ensuring we provide the best service and journey.
Times might be changing and technology advancing, but one thing’s for sure: whatever the car of the future looks like, glass repairs and replacement will always be needed. During a claim, a customer will want to feel that they are in good hands and that the experience will run smoothly.
Finally, my advice to a young person? It’s not an easy journey - but with hard work, passion, drive and good guidance you can achieve anything!
What is currently being done to encourage and nurture new talent?
2019 saw a seismic shift in talent requirements. Traditional roles are toppling rapidly in an array of industries; from professional services like accountancy, legal work, teaching, some medical operations, to sales & services and manual tasks such as security, military and farming. Artificial Intelligence (AI) in its various forms, is sweeping a significant proportion of traditional jobs away, with remarkable economical, accuracy and time benefits. It is depressing for those who may have spent many years training for such professions, but it has spawned a host of new roles in data, machine learning, robotics, cyber analysts, genetics, quantum computing, AR & VR and cyber security. It is therefore essential that new talent is focused on contemporaneous or near future roles rather than traditional. We work in conjunction with the Liverpool Enterprise Partnership to embed this message into schools; our workforce of the future. We have learned from tech-savvy cities around the globe to integrate technology into lessons. Who would want a copywriter who didn’t know Word, or an engineer who couldn’t use Excel? The importance of technology within schools cannot be underestimated. At apprentice level, we sweep up almost anyone with technology skills, as IT is the backbone of the entire company. From workflows; new developments and projects; hardware and telecoms; security and storage our traditional companies have evolved into tech firms. We are ensuring that traditional roles are re-skilling. For example, sales and marketing used to involve phone calls, networking, emails etc. Whereas there are significantly better methods today, so we retrain them to understand funnel marketing, social media use, demographically driven marketing. Modern and tech driven skills are important, but we believe that the work-place culture is just as significant. Not just a case of buying a pool table, but actually listening to the unique needs of the humans. We are fiercely proud of our culture and have shunned many outdated practices. The work needs to be done to a high standard, within SLAs, plus we aim for the client to be delighted with our products and services, but does it matter what our staff are wearing? Does it matter what time they start or finish? We have dogs in the office, beer and wine, we work from home, duvet days and most importantly actual personal development. We believe that a diverse mix of contemporary skills development, attitude & culture is the best way to nurture our talent to face the challenges of 2020 & beyond. Nik Ellis, Managing Director, Laird Assessors.
Laird’s automotive solutions are designed to increase e ciency, reduce costs & speed key-to-key times for their partnered clients.
Our keen interest in technology has enabled their transformation into a company pushing boundaries within the industry. Our teams appreciate the power of collaborative technology, with many solutions released over the last year; some benefiting our client directly such as API connectivity, total loss & repair management, FNOL triage & our recently upgraded online portal. Others have helped our client’s customers such as our 24/7 smart booking app, chatbots & imaging apps.
With multiple awards in customer service & technology, Laird recognises the importance of complimenting tech with well trained, happy & motivated teams.
