“Yin” and “Yang”:
You may be familiar with the terms “Yin” and “Yang”, based in Taoism. Yin and Yang is the concept of how opposing forces interrelate and may be complementary. In his book, “12 Rules for Life”, author Jordan Peterson compares Yin and Yang to the opposing forces of chaos and order in human life. He explains that order keeps us safe and gives us a sense of stability, we know what to expect. Conversely, when something unexpected happens, when there is change there is chaos, we lose our sense of security and seek to find balance. Besides the obvious human utility of this concept to explain the tensions and emotions of everyday life, the concept has an application for our experience in this age of digital transformation. It is a period of rapid change and convenience! It is the era of Amazon, Google, simple applications to get immediate answers, on demand shopping or grocery delivery in real time, all at your fingertips, without ever leaving your home or office. The field of insurance is the last institution gasping and grasping with its fingernails, to the “old ways” of underwriting, policy making, claim management and service delivery. It is being pushed, pulled, and dragged into the future by consumers demanding personalized insurance products and service, and InsurTech incumbents, ready to meet those demands.
Customer/ Patient Engagement:
Consumers demand better service, they are not satisfied to purchase goods or services which do not meet their unique needs, in real time. The patient as a stakeholder, is no longer just an observer to a treatment plan, but rather an active participant in the plan of care. Patient quality scores are part of the quality measures for health care and a requirement for shared savings and value-based care initiatives that pay for performance-based outcomes. The Centers for Medicare and Medicaid Services (CMS) champions patient centered care and data analytics to improve health outcomes. These concepts will steadily gain traction in the non-group health Property and Casualty arena, as it has in group health, since the inception of the Affordable Care Act in 2010.
Digital Transformation:
A 2018 National Association of Mutual Insurance Companies (NAMIC) poll revealed 82% of insurance company respondents named data analytics as a top priority followed by improved customer experience and new products/services. Data is Power! Using data intelligence, insurance companies can identify, manage and control risk and exposure, and make better informed decisions about individual claims. Simultaneously, in 2018 A.M. Best announced that it considers innovation to be an important aspect of a company’s ability to bring down its costs for the customers and protect its position in the marketplace, and it is defining the use of innovation in its assessment of an insurance company’s financial stability. A strong warning message to an industry adverse to risk and resistant to change.
The Changing Workforce:
Since 2011,10,000 baby boomers per day turn 65 years of age, and this trend will continue until 2030. Much of the experience in Workers Compensation claims is retiring, leaving a gap in claims management and settlement skills. By 2020, 25% of all workers will be age 55 or older, Millennials will represent 46% of the total combined workforce, and Gen-Z will make up 20%. Michael Costonis, Former Global Insurance Lead at Accenture, once said that Millennials want “the company they work for to have a commitment to using technology to make employees’ lives easier. Nothing turns off Millennials more quickly than coming to work one day and facing a legacy system dating back to the mid-1980’s, with less sophistication than many of the personal devices they use.” To develop a talented, shrinking workforce, the availability of technology to augment job requirements, is a requirement!
What’s Next?!:
The convergence of all these trends is the perfect storm driving the digital revolution in Insurance. Consequently, all this change creates a sense of chaos for the end user, but the Yin and Yang is that the implementation of new technologies will bring order to the claim’s management process, on a scale that we have never experienced before. Technology will improve the insurance experience for everyone bridging tech with touch for the employee, the policyholder, injured worker, claims leaders, providers, suppliers, everyone in the insurance ecosystem. As we transition from what feels like order to chaos, order will be restored, and we will wonder how we ever managed claims the “old way” in such a fragmented, chaotic system.