Last week, Novarica hosted its first 2020 virtual Personal Lines Special Interest Group. During this session, our insurer clients and Research Council members had the opportunity to network and share their knowledge on the impact of COVID-19 on personal lines products, industry trends, and current IT priorities.
COVID-19 Impact on Personal Lines
Participants kicked off the discussion with thoughts on how COVID-19 has—and continues to—impact personal lines priorities and projects. P/C insurers primarily focused on cloud transformations and innovation before the pandemic. COVID-19 shifted priorities to improving remote connectivity infrastructure, increasing internal digital efficiencies, bettering the digital workplace, and cutting costs (i.e., for innovation, operations, real estate).
One participant shared that they are now focusing on digital, with projects around modernization. Another observed a shift in responsiveness and flexibility of regulatory agencies. Some agencies are tightening rules and conducting product assessments in greater detail, affecting the acceptance of certain rate increases.
The conversation also touched on the process of onboarding remote workers and leading dispersed teams during the pandemic. Participants debated the merits of setting reasonable expectations, encouraging frequent communication, and creating a culture of transparency. One leader shared that they had successfully created a library of assets to walk new hires through various system functionalities. Their organization had also given remote workers weekly one-on-one sessions to guide them through using the company’s core platform. Another participant mentioned that assigning a peer mentor or “buddy” to the new employee was also useful.
Maintaining positive company culture during a pandemic can be tricky, but many participants reported success with regular, company-wide virtual social events. Surprise small gift deliveries, themed virtual events, and a wellness channel on Microsoft Teams went a long way to maintaining employee morale and received tremendous positive feedback.
Personal Lines Product Trends
The conversation touched on the time it takes to stand up new products. One member shared that the average time to deploy new products (including forms, underwriting guidelines, and rules) decreased to 90 days after their organization moved away from its legacy system. Agile methodology, robust QA methodology, and relying more on internal resources also contributed to greater speed-to-market.
The discussion on new auto insurance predictive models was also interesting. One participant noted that a complex and overly comprehensive predictive model might not be the right way to go. However, seeking out simplicity in analytic models is also not the answer. The better question is: How are you exposing the impact of model complexity to the end-user?
To make an informed choice on model complexity, an organization must understand and evaluate the additional value the complexity brings versus the additional cost of acquiring the data or supporting the model during future changes. Simplistic models may be just as effective at lowering overall costs.
See Novarica’s report, Business and Technology Trends: Personal Lines, for more on personal lines trends. The next virtual Special Interest Group with a focus on personal lines will take place on Thursday, October 8, 2020, at 1 PM ET. Register for that event here: https://novarica.com/novarica-personal-lines-special-interest-group-virtual-meeting/
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