On April 1st, Novarica hosted what was intended to be a “regional” client event for insurers based in the Philadelphia area. Given the COVID-19 pandemic, we changed it to a virtual session and opened it to a broader group of clients and Council members. Unsurprisingly, one of the key topics was how carriers are addressing new, pandemic-related issues, with video capabilities high on the priority list.
There isn’t one tool that is ideal for all situations, but many good tools exist. Some carriers have reported positive results with Microsoft Teams, for example, as part of their pivot toward Office 365. One product that has garnered significant attention is Zoom, which offers a set of flexible capabilities and a free version to help people get running quickly in these unusual times.
Discussion of these tools inevitably led to security, particularly since “Zoom-bombing” has become notable as deployments have grown. This phenomenon is an unfortunate artifact of the default security settings, which the company has worked to change.
Digitizing Independent Distribution
Tools for communicating with field partners (i.e., agents, brokers, etc.) also interested the group. Many carriers are still highly dependent on paper processes, which is creating issues for back-office organizations and can be problematic for field operations. In a recent Novarica Virtual Town Hall with agents, one of the comments was “the only reason I go to the office is to pick up paper from carriers.”
During that same session, a survey indicated that email and text messages are now the preferred form of communication, perhaps exacerbated by the current environment. As carriers pivot to a more digital stance and search for tools to connect with their field partners, many are finding that home-office-focused solutions don’t work. Some experimentation in this area may be required to address both available hardware and bandwidth.
This led to a broader discussion about COVID-19’s impact on distribution and what carriers may need to plan for in the not-too-distant future. Distributors are having to adapt quickly; their adoption of digital platforms and business processes will likely be accelerated dramatically. These solutions may now be a “must have” rather than a “nice to have” option. Digital capabilities and the elimination of paper-bound processes may become a point of competitive differentiation very quickly; carriers with only partially digitized processes may find themselves at a disadvantage.
Agile at a Distance
Agile development methodology was also a high-priority area during the session, with refining implementation to support remote teams being a particularly urgent consideration. We explored a broad set of approaches for carriers, including investing in tools which support the virtualization of key activities normally facilitated by the co-location of teams. A recent Virtual Town Hall explored the subject in greater detail.
Carriers just starting their Agile journey can use this time to prioritize areas where smaller, quick wins can be achieved early. Good IT/business sponsor partnerships can help with this method, bringing things up to speed in specific areas rather than trying to go “full to bright” all at once.
What’s Next?
Talk of changing methodologies led to discussion of what may happen once the pandemic recedes and shelter-in-place orders are lifted. It is clear that the new normal will not be what we remember from February, which suddenly seems a lifetime ago.
The insurance industry has been slower than others to adopt virtualization of operations, and digital capabilities have been deployed unevenly. Suddenly, everyone is having to adapt, and many in the ecosystem (e.g., carriers, producers, and customers) will find they prefer elements of what has been discovered.
In addition to distribution, other key processes such as claims submission and underwriting may also be undergoing a rapid transformation. P/C inspections and fluid-based underwriting for life carriers may need to be adapted to a world where the 2019 model is no longer possible or socially acceptable. Novarica explored some of these implications on our blog recently.
During the event, we also touched on the evolving regulatory and legislative responses to dealing with the fallout from COVID-19. It is too early to know exactly how this will play out, but Novarica’s website is updated frequently with new information related to the pandemic.
Once stabilized in the current, temporary environment, carriers will want to consider what happens next. DR/BC plans frequently practice getting to a new environment, but they don’t provide much guidance on reversing the process. The next few months will test carriers in unexpected ways. For our advisory clients wanting to explore issues and options or simply to review alternatives, Novarica resources are at the ready.
Future Meetings
The session was a terrifically interactive opportunity for Novarica clients and Research Council members to engage about high-priority issues. The virtual format worked well, and we plan to incorporate the model into an array of upcoming Novarica events, including our Special Interest Groups. Insurer client and Council member Virtual Town Hall meetings are now scheduled every Tuesday at 1pm ET through the end of June. You can register here.
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