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How to Integrate Cloud, Mobile, and Analytics for Insurance Success

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InterConnect 2015

At InterConnect 2015, I attended several insurance-focused sessions, including co-hosting an industry luncheon and co-facilitating an insurance industry round table focused on “customer-activated operations.” I came away from the conference with three main observations:

  1. Insurers are still reticent to get in the cloud.
  2. Insurers are eager to develop mobile offerings that engage customers.
  3. Insurers are realizing they need more sophisticated customer analytics to understand their policyholders’ journeys from “cradle to grave”.

Let’s examine these takeaways one at a time.
Insurers are still reticent to get in the cloud. Many insurance companies still keep their complex web of legacy systems behind their firewalls, literally walling off vital communications from their ecosystem partners. This keeps insurance companies from quickly and flexibly responding to their policyholders’ needs, particularly in times of crisis. Why would an insurance company purposefully let their rigid infrastructure get in the way of meeting their customer needs? The stated reason usually goes something like this, “Regulators, with their jurisdictional rules about where data and applications can and can’t be held, limit our ability to move to a cloud environment.” But, that’s not the whole story. Cultural reasons have also served to keep insurers from challenging the status quo. Why? The safety of command and control. At many insurers, the information technology department often has the satisfaction of governing all of the insurer’s data flows and processes. If a line of business executive should raise the issue of stepping outside the boundaries of the organization to better meet customer needs, IT can usually silence that voice by raising the specter of a customer data breach that creates a marketing disaster and lost customer revenues. Unfortunately, while everyone at the insurer is resting easy with their virtual guarantee that policyholder data is out of harm’s way, outside agents, customer service reps, and ecosystem partners (e.g., auto repair shops) that need it to help customers may not be able to get to it either!
Happily, there is a sea change occurring. New insurance industry CEOs and CIOs are beginning to mandate that their entire organizations become more customer-focused. Eventually, this will mean more sharing of appropriate information across insurers’ ecosystems. What do insurers need to know? Hybrid clouds can help insurers drive digital innovation and rapid service delivery by recomposing their existing systems and processes while ensuring the security of policyholder data.
Insurers are eager to develop mobile offerings that engage customers. It’s no secret that empowered consumers are demanding mobile engagement from their service providers. This is true even in insurance where customers expect mobile apps to make a claim (including sending photos of damage), schedule any needed inspections, keep track of the claims process, and receive electronic payments – all over their mobile devices.
In general, insurance providers are ready to get started. But, they don’t always know how to go about mobile app development. Insurers need to know that there are already mobile platforms out there that are enabling insurers to radically streamline and accelerate mobile adoption to create meaningful customer engagement.
But, developing one-off mobile applications to meet customer needs at specific points in time is not enough. This ties in to my third observation.
Insurers are realizing they need more sophisticated customer analytics to understand policyholders’ journeys from “cradle to grave”. Unlike for much of retail, an insurer’s relationship with a policyholder is not merely transactional (e.g., buying a pair of shoes). Rather, an insurance company is a policyholder’s personal risk manager, stepping in to mitigate what could otherwise be an irreversible financial disaster. Interactions between insurance providers and their customers are often fraught with emotion because they occur when the policyholder is most vulnerable (e.g., right after their multi-generational home has just been flattened by a tornado). Coming through a disaster together can forge an unbreakable bond between insurer and policyholder – if the insurer proactively and reactively responds to their customer’s needs in a meaningful and satisfying way.
In order to forge a “cradle to grave” relationship that strengthens over time, insurers are realizing that they need to understand their customers’ journeys so that they can more accurately anticipate their needs. Understanding customers as they pass through critical life stages requires combining digital, behavioral, sentiment and predictive analytics. Today’s customer analytics solutions enable customer understanding in context, at various touch points and throughout a lifetime of interactions and purpose-oriented journeys.
The good news is that insurance providers are realizing that cloud, mobile and analytics solutions are crucial to helping them achieve their customer engagement goals. But, the news gets better! There is an integrated portfolio that melds cloud, mobile, and analytics components into a powerful portfolio stronger than its component parts!
IBM’s Commerce portfolio amalgamates cloud, mobile and analytics solutions to drive higher conversion rates, improve customer experience with personalization, increase loyalty, and resolve problems more quickly. How?

  • IBM Commerce just announced a major push into the realm of hybrid cloud solutions and services. Customer-facing “systems of engagement” can run on public clouds, where they integrate and interact with back-end “systems of record” that contain sensitive data and can run on private, on-premises clouds.
  • IBM Commerce helps insurers manage evolving channels and interaction points across web sites, mobile devices, social media and physical channels. IBM’s MobileFirst partnership with Apple is already releasing jointly developed iOS business apps and supporting services.
  • Customer analytics helps insurers understand their customers better in context at key stages of their journeys so they can fully engage customers in more meaningful ways. As a critical enabler to continuous customer engagement, IBM Commerce’s customer analytics help satisfy today’s empowered customers who are connected, have easier access to information and possess high expectations.

So, if you are thinking about realigning your organization to better respond to today’s empowered customer demands, investigate how IBM leverages cloud, mobile, and analytics within our Commerce portfolio to help insurers deliver seamless Brand engagement!

Global Cloud Leader, IBM Institute for Business Value

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