5 Steps for Insurtechs to Better Engage Carriers and Industry Stakeholders
The insurance industry, typically a slow mover in adopting new technologies and initially lukewarm to partnering with insurtechs, has quickly become a sophisticated marketplace with carriers and other stakeholders now looking outside the enterprise for solutions. For carriers today, it is all about “Let's find the right partners to solve our greatest needs.”
Multiple factors are driving this momentum, in particular the need for carriers to reduce expense ratios. Competition is the main driver for innovation, and just like other laggard sectors, in the case of "monkey see, monkey do" we are seeing the insurance industry react positively to first-movers that took a risk with successful outcomes. Continued and increased venture and private equity capital investment into the space aimed at solving specific insurance problems, also has been a catalyst.
This presents a gigantic opportunity for insurtechs, particularly those that have made speculative investments to create deeper, more user-empowered solutions. For example, while the science of pulling text off a page has become commoditized, and there are many such tools on the market, carriers today will want to know how the solution structures the data extraction itself; its quality for handwriting analysis; its capability specific to insurance terms and forms. Does it do this in a systematic, adaptable, and agile way? Are the data sets interoperable? And so on.
To make the most out of working with carriers and other insurance industry stakeholders, insurtechs should consider this five-step approach to product building and customer engagement.
1. Create clarity with a defined product vision and strategy
While insurance industry clients may come to you with a stated problem, the short-term goal is almost always to reduce cost and increase capacity. When building out your marketplace solution, your success will be predicated upon whether your product helps customers achieve efficiency. But can you also help them meet future stated revenue goals and increased profit margins? That should be your overarching principle when deciding on which new features to roll out, with a concerted focus on improving workflows that unblock and increase throughput.
2. Build future-proof models that are adaptive, agile and scalable.
Think for a moment about the advancements in digitization and the vastly improved access to more usable structured data. It would be almost criminal to “waste” an automation process and not consider how it could be applied downstream for other data processes. Just because the ingestion of new models is painful today, you still should think about building better risk models tomorrow. As a general rule, do not impose a rigid structure on your carrier customers, or you may risk seeing your solution later become a “legacy” solution that is perceived as a roadblock to innovation.
3. Deliver tactical product innovation that solves operational pain
One of the most basic guiding principles for leveraging software and technology is to make processes and humans more efficient. In fields such as underwriting, there is value to human reasoning and rationality. Nobody is saying humans can be 100% replaced by machine learning. But there are obvious areas within underwriting that can be performed and automated by a machine; for example, extracting data off of a page, and structuring the data to make it useful.
Machines do not forget things, and they do things with consistency. In a critical process within the workflow, ML will not forget to look up a certain or particular database or a piece of critical underwriting risk data. The workflow is set. Sure, there may be a small delta to having it look up a data point that is not useful versus a human not finding a data point that can be useful. But in fact, 100% of underwriting intake can be operationalized with technology. Faster, predictable and more accurate data removes operational bottlenecks and is a low-hanging fruit. All of our customers experience this!
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4. Continually refresh around accuracy.
Remember to maintain closeness to your data sources. If you have not built your smart plumbing, a change could potentially be devastating and set you back. You should be transparent with your investors and board, sharing that the company is carving out resources for technology and engineering improvements that might not immediately result in a shiny object, or faster go-to-market but that supports back-end efficiencies.
5. Take a customer-centric approach to how you deliver products
Problem-solve ahead of the need through communication, and establish close relationships with key stakeholders. You want to be the first to raise new challenges before they come up.
Understand and problem solve ahead of the curve. For example, look at metrics on usage on how they use your platform. Are there inefficiencies that can be removed, or efficiencies that can be exploited?
Use tools to analyze what your end users are doing on the platform, and then work to tailor features and solutions more precisely to what they are actually trying to achieve.
The insurtech’s role is to marry the customer’s expertise selling commercial insurance with your expertise designing the best solutions. At the beginning of every customer relationship, ask the carrier “What problem are you facing?” instead of asking them “What do you want us to build?” When they say “build this,” it may not necessarily be the best solution for now and later.
Work closely with the internal customer lead stakeholder to get buy-in to a roadmap that goes beyond tactical need. This takes a nuanced approach that combines appreciation for current issues while blocking out for the future.
About Convr
Convr is a modularized AI underwriting data analysis platform that digitizes and fuses submissions with best sources of information to surface underwriting insights, business classification and risk scores. The platform has revolutionized the industry through data, discovery and decisioning intelligence.
Convr customers include commercial insurance organizations of all sizes, including many of the Top 10 carriers, which use the platform to enable superior performance, optimal efficiency, quality decisioning and world-class customer experiences.