A Changed World – 6 Key Issues for insurers to consider

Manifesto

The world has changed.  The second half of 2008 saw events that previously would not have entered our wildest dreams. Who would have thought that one of the UK’s largest banks would pass into state ownership? Who would have thought that one of the longest periods of uninterrupted economic growth would stop dead in its tracks?

With this in mind, employees at Salmon recently put their heads together to author a manifesto (in 6 parts)  for Directors and Managers of Insurance companies, who have a responsibility for eCommerce and eBusiness.   Part 1 is available now as a downloadable .pdf, and considers “Will your Customers Change?”

It is our belief that at least six key issues need to be considered by insurers right now.  We will explore each in full in due course so register here to get each part of the manifesto emailed to you.

Here are the issues as we see them.  What do you think?

  • Issue #1:  Will your Customers Change? Even counter-cyclical industries, like general insurance, need to carefully consider this question.  After all, any business is only as stable as its customer base.  As we shall see, answering this question is not straightforward.  There are indications that we will have to think about meeting at least three shifts in customer demand and buying behaviour.
  • Issue #2:  Flexing our Cost Base Reducing operational costs has been a major component of most organisations’ plans over the last decade but there are new challenges.  Firstly, living through an economic downturn means that we have to rethink the minimum critical size of our operations.  Secondly, economic, political and social pressures may mean that we have to revisit past strategies based on outsourcing and offshoring.  These now established recipes might not serve us too well in the coming years.
  • Issue #3:  New Channel Relationships Emerging evidence points us to the fact that customers’ buying criteria – how they make purchasing decisions – may be changing both in commercial and consumer markets.  This means that current web based distribution will have to change if it is to deliver real value for both customers and suppliers.
  • Issue #4:  How to Unlock Markets Extending the reach of offerings into new markets is a commonly cited piece of advice for organisations facing an economic downturn.  A better and more astute move is to unlock markets that traditionally minded competitors think are either unprofitable or can only be served in one time established way.  To keep ahead of the game we have to consider how technology can act as a key to redefining markets that others pass by.
  • Issue #5:  Regulation – The Tool of Change:   There is no doubt that the current downturn will produce a globally co-ordinated push for new regulatory approaches to prevent another financial crisis.  November 2008’s first meeting of the G20 – the countries that will reshape the business world – put regulation right at the top of its global action plan.  All we know now is that the regulatory demands on organisations – especially in the financial services sector – will change.  The impact could range from more disclosure regarding investments, through to increased customer education and new roles for directors.  The demand for information will increase and new co-ordination and control systems will be needed.
  • Issue #6:  Information for Tough Times:  Research tells us that organisations that survived the last real downturn – in the early 1990s – managed their businesses in a totally different way to those that failed and disappeared.  Those that succeeded were closer to their customers and used a far broader range of management information than did the failures.  These winners were better at getting and using customer and market information.  So, systems for decision making have to go way beyond traditional financially based approaches if our businesses are to survive and grow in the current environment.

There is no doubt, rather than entrenchment, this is a time for innovation in how business processes and systems really deliver value. I hope you like the manifestos.  Please feel free to share and re-use.

Novae Underwriting get revamp by Salmon

A great new announcement was made this week:

Online Underwriting for Motor Fleet line-of-business

The announcement reflects our delight helping Novae launch its Motor Fleet line-of-business on RiskWrite, extending the web-based platform implemented originally back in 2004, to cater for a range of new productsto be marketed quickly and efficiently.  (You can read the announcement we made when we first started working with Novae here and get a complete case study here).

Steve Fookes, IT Director Novae said; “The introduction of Novae’s Motor Fleet Underwriting Service is an opportunity to strengthen our market position. We needed a completely integrated IT infrastructure that could be aligned across the business which was cost effective and would support ongoing growth.”

Designed as a series of fully reusable and customisable components that allow insurance companies to quickly leverage a truly open IT architecture; RiskWrite provides Novae greater visibility of the insured, policies and claims throughout the life cycle; encompassing such activities as quotations, placement of orders, policy production, financial management, document generation, management information and regulatory requirements.

For those not in the know (I am assuming everyone isn’t an expert in online insurance underwriting, thankfully Salmon are) this is a big deal.  The web-based system we have developed ensures that paper-based inefficiencies are a thing of the past and help Novae provide a high level of customer service to its brokers (such as providing online quotes and offering “acceptance” immediately, together with instant documentation).  Motor Fleet Underwriting is a complex business, and as part of the project Salmon has interfaced with third party systems likes the Motor Insurance Database, however, Salmon was still able to ensure Novae hit the go-live deadline and enabled Novae to commence trading on schedule.

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What a great end to the working week….