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Sunday, Oct 1, 2023

Insurance & Technology Forming a Closer Bond

The insurance industry may not have been the sector that pushed the envelope in information technology, or technology in general.

Increasingly, though, insurance and technology are becoming inseparable.

“We’re making literally tens of millions of dollars in investments in new technologies,” said Hal Dunning, president and COO of the West Region of Marsh & McLennan Agency, in a recent interview.

“We’ve come a long way since the fax machine,” said Sallie Giblin, president of Lockton Insurance Brokers LLC, based near University Towne Center. Giblin said she is “passionate about technology,” particularly in the way it can take employees away from clerical work and free them up to provide more client service.

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With the changing marketplace, the introduction of new regulations and the changing political landscape, “clients are relying on us for more strategic support,” she said.

Quoting Fast, Vetting Thoroughly

Technology is making inroads in the industry by simply letting customers serve themselves through a website, bypassing customer service managers.

In one instance, Ahern Insurance Brokerage has rolled out a cyber insurance product with cloud-based enrollment. Customers in the market for a policy can apply for coverage, get a quote, pay their premium and get a policy issued as part of completely online process, said Melodie Mesiano, marketing director for Ahern. The Kearny Mesa business serves law firms.

Bill Habeger, founder and owner of the B.H. Gold insurance agency in Mira Mesa, said he can now quote rates from 20 or 30 insurance companies well within five minutes. “Five minutes is a long time,” he said.

Bots are given the task of going through massive insurance policies, making sure that the policy says what it’s meant to say, checking limits and coverage, Dunning said.

That’s a huge investment an organization has to make, the executive said.

Life sciences is Marsh & McLennan’s biggest practice group. Many clients are going through clinical trials and consequently have exposure in that area. Health care is Marsh’s second biggest vertical market.

Self-service, computer-aided quotes and bots are only the beginning.

A Technological Vision

An upcoming convention for independent insurance agents promises sessions on digital marketing, cybersecurity and the impact of artificial intelligence and machine learning on the industry.

Attendees can learn how to become “a data-driven agency.”

Internet-connected wearable devices might provide more data for insurance companies to consider when evaluating risk and setting rates for life and health policies, according to Big I (also known as IIABA, or the Independent Insurance Agents & Brokers of America). The Virginia-based industry association has an arm that evaluates new technologies. Its next tech conference is April 22 in Orlando, Florida.

The organization also sees virtual reality and mixed reality technology taking a place in the insurance business. Mixed reality is a real-world video image with a computer-generated image laid on top of it, in the manner of Pokémon Go. It might influence the ways agents interact with their clients. It may even be applied to claim processing.

Behind the Scenes

Insurance these days relies on massive amounts of data, said Ross Afsahi, area president for Gallagher.

“Data is the king” of current and future insurance programs, he said. “Forward thinking companies are relying entirely on data.”

Data is changing the way insurance companies and underwriters assess risk, Afsahi said, mentioning recent losses from wildfires in California and Australia. Having data enables an underwriter to better assess risk and price risk, he said.

Afsahi, who has been in the industry since 1985, said data has not always been available in the format and the frequency that it is today. In the past, individual carriers had data and held it “close to the chest.” Today there is more opportunity to get data with aggregators who run “data warehouses.” Afsahi spoke of “data lakes.”

“It’s a very good thing for the industry,” he said.

Chasing Paper

It wasn’t always this way. “We’re the insurance industry. We’re the most paper driven industry out there,” said one business owner interviewed for this article.

Habeger said that a business he bought in 2006 still had all paper files. “I think some agents are still using paper files,” he said.

Of course, the current situation is not perfect.

If anything, today’s computer systems need to become more integrated, said Jim Morrison, president of Morrison Insurance Services Inc. in Carlsbad.

A business owner might need to remember passwords for separate systems that take care of time and attendance, payroll, human resources, benefits and 401(k) investment plans.

“We’ve gotten to this kind of quirky point where there are almost too many systems,” he said, saying the disparate systems should share information with each other.

“The purpose of technology is to make things simpler and easier,” he said.

Charting a Course

More change is around the corner.

Lockton, a privately held business, based in Kansas City, recently hired a new chief information officer and made a big investment in a chief digital officer, Giblin said.

For employees and clients, it may not be business as usual.

“Just because we did it one way in the past doesn’t mean we continue to do it that way,” she said.


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