Best's Review


2020 Vision
Strategic Planning

From curating content for individual customers to tackling the industry’s image problem, insurance leaders weigh in on how to remain relevant in the new decade ahead.
  • Kate Smith
  • December 2019
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Expand coverage. Personalize interactions. Convey purpose. Understand where customers are heading. There are many theories on what businesses should do to stay relevant in today's ever-changing environment.

As 2020 approaches, Best's Review asked executives what the insurance industry must do in order to maintain its relevance to customers. Here's what they said.


Meaningful Differentiation

Bill Pieroni

Bill Pieroni

In most mature markets, you're essentially engaged in a zero sum situation. In other words, your customer was someone else's customer, and vice versa. In those “hypermature” markets, cost-focused due diligence tends to dominate.

When I think about what we need to do as an industry, we need to change consumption patterns for buyers of insurance. It is critical that we, as an industry, change passives to enthusiasts. Specifically, taking buyers who tend to focus on price—the comparison shopping—and turning them from opportunists into loyalists.

We need to ensure that we invest and execute around meaningful differentiation. Price competition is not differentiation at all. Anybody can copy a price. Anybody can copy an ad campaign. Strategic differentiation compels buyers to switch and stay for reasons beyond price.

There are three levers to sustainable, meaningful differentiation—innovation, products, and experience.

Innovation is less about what you are going to do, and more about when and how you will do it. Awareness of innovation levers is critical, but not as critical as execution.

In terms of products, tailoring to a buyer's preferences and values is critical. Carriers must move beyond the concept of mass customization to true tailored products and corresponding experiences.

Finally, delivering a superior and consistent customer experience across touchpoints is a critical strategic differentiator. We need to engage consumers not only around the shopping experience, but around claims, endorsement, service—every dimension.

You know what's interesting? As Churchill said, “The longer you can look back, the farther you can look forward.” We need to execute around what agents have done for decades, if not centuries. When customers walked into an agent's office in the 1950s, the agent immediately started trying to answer two questions. First, what experience is the potential buyer expecting? And second, what product or service is required to meet this customer's needs? Successful agents tailored their approach and offerings on a dynamic basis.

As an industry, we need to do what these agents have done seamlessly for decades. However, we need to do it in the context of widely divergent consumer expectations and requirements, and on a 24/7 basis across multiple touchpoints—the agent, the call center, online, maybe even via mail.

This requires an explicit strategic intent, and resource allocation. It's not going to happen by accident.


Stay Nimble


Dan Preston

There are a number of efforts that are critical to staying ahead. You need to be spending time with technology companies that are either reinventing the safety features of a car or thinking differently about how cars are owned—whether it's car sharing, ride sharing or other subscription models.

It's important to understand where the consumer is headed. What the person is doing with their car will change the way in which they are insured. So that's one dimension of understanding the market overall.

I do think that just spending time with insurtech companies in general and finding ways to partner together, some of which may not be obvious in terms of bottom-line earnings, is pretty important. We found a lot of value in this with some of our strategic partners like Intact. These partnerships inspire a lot of ideas for the future.

But I also think staying relevant, frankly, is about being nimble and spending time with your customers. That's ultimately what will drive a lot of interesting insights. We spend a ton of time on video chats with customers, trying to understand what they like and don't like. That inspires a lot of the new ideas we have. As an example, our recent partnership with [car-sharing service] Turo was actually inspired by customer behavior. We had a relationship with them before and got the idea that we could use per-mile insurance to help the owners of the vehicles save money. But we also found that our customers were using per-mile insurance to save on the product already, but just didn't have the seamless experience yet. So we were able to develop an experience that Turo can extend to all of its customers.

So it really needs to be from multiple dimensions.


Embrace Customer Expectations

Glenn Shapiro

Glenn Shapiro
President of Personal Lines

I would say the insurance industry is incredibly relevant. We make it possible for people to own homes and take risks in their lives, and have comfort in those risks because they're covered for them. So insurance is and will continue to be relevant.

But from a customer-service standpoint, we have to look at the world around us. People's perceptions of service are being framed by things well beyond insurance. We have to embrace those ways that they're being served in other places, and bring those in. Their Amazon experience and their Netflix experience are framing the way they think about service. And they're not going to compare us to other insurance companies; they're going to compare us to other experiences they have.

I think we can compete pretty favorably, when you think about the capabilities we have. I go back to telematics, because as much as you can get out of your shopping experience with Amazon, it's not going to make you a safer driver or tell you who in your family is the best driver, if you want to have a little friendly competition. It's not going to tell you when your young driver is going over 80 miles per hour and being unsafe; it's not going to help you protect your family; and it's not going to help you reduce your rates.

Those are things we can do, and we can really be relevant in that way.


Aggregation Mindset

Bob Reville

Bob Reville

When I speak to senior executives for insurers, particularly in the larger corporate casualty space, there is a concern about creeping irrelevance. I say creeping because nothing in casualty moves that quickly. But also because there's a slow and steady erosion of coverage.

When you look at casualty insurance in the 1970s, it was occurrence coverage. The number I saw was that 94% of U.S. tort was covered by insurance. In the intervening years, there was a lot of movement away from occurrence and an increasing number of exclusions.

The net effect of all of that is that in 2012 only about 55% of commercial tort was covered by insurance. Today, that number could be as low as 50%.

So the relevance of insurance to commercial tort has declined. When I talk about that with people in the industry, they're worried about it. I believe the industry needs to be looking for new solutions. Insurers need to try to find ways that will allow the coverage to continue to be profitably written, but also be there to solve the problems of their clients.

We need to move from an exclusion mindset toward an aggregation management mindset. We have to find ways to be responsible without moving away from coverage.

Also, when risk management is more in terms of claims management than it is underwriting, that is not sustainable. So sometimes claims management ends up being about disputing coverage, and that does not lead to good long-term relationships with clients. That risks making you irrelevant, as well. So the more the work can be done at underwriting stage, the better.

And one of the areas we're really interested in is figuring out how to go even further upstream in managing the risk. To the extent that analytics can be delivered by insurers to their clients in ways that allow them to lower their risk, where they can tangibly see how it lowers their risk, and that information uniquely comes from insurers—that's the home run. Because then the insurers share in the value of the risk reduction, and it's a great way for the industry to be extremely relevant.


Purpose Over Products

Richie Whitt

Richie Whitt

We need to face facts that we sell a product that people really wish they didn't have to buy. It's not about your product, it's about what your product does.

We need to focus on the customer experience. We need to recognize that the insurance product itself isn't that exciting to people. How do we integrate ourselves into their lives where it's not just about insurance? Where it's about helping them accomplish things they want to accomplish in their lives or business?

I listened to a presentation where the speaker said, “It's about purpose, not product.” I thought that was brilliant. We need to do a better job as an industry of relating to our customers and talking to them about purpose instead of just bringing them a product. Because let's face it, it's hard to get excited about insurance products.


Personalize Offerings

Brooks Tingle

Brooks Tingle
President and CEO
John Hancock Insurance

I would say personalization is key. When you think of all our interactions as consumers, companies we work with know so much more about us now. We should be able to personalize people's experience. Even in the context of our Vitality wellness program, it's a wonderful program that broadly serves everybody, but everybody's wellness journey is a little bit different. The root of all my wellness evils is a lack of good sleep, so I probably need help getting more sleep. Someone else may have a chronic condition they're trying to manage.

Data is also big. A lot of people worry about big data, but think about the power of data to personalize experiences for people. We offer healthy food recipes, but we offer the same healthy food recipes to all of our customers.

We have a healthy food program where people can get 25% off healthy food purchases at over 16,000 grocery stores nationwide. So we have data that says, “This person tends to buy lima beans and corn,” and “That person tends to buy squash and zucchini.” Instead of giving everyone the same recipes, why wouldn't we serve the first person recipes that feature lima beans and corn and the second person recipes that include squash and zucchini?

Even with exercise, with wearable devices we know whether someone likes to run in the mornings or walk in the afternoons or row on weekends. If we know someone's primary form of physical activity is rowing, why aren't we serving them content on rowing activities rather than general content around physical activity?

I love to boat and spend most of my free time boating. But I've only ever owned power boats, which I use to go fishing. I still get target marketing material for sailboats. The data is out there to say, “He's only ever owned this kind of boat, and look at all the fishing equipment he's bought.” So the future, in many ways, will be about taking that information and using it for more personalization.


Talent and Tech

Pina Albo

Pina Albo
Group CEO
Hamilton Insurance Group

I think our relevance hinges on two components: talent and technology.

Let's look at technology first. Is it self-evident to say our relevance revolves around technology? Yes, of course, it is. While we can acknowledge this as an obvious statement of fact, taking action is complex.

In spite of the best strategic intentions, the manner in which insurers and reinsurers embrace technology is often thwarted by legacy systems and old habits.

Many of our well-established carriers have been in the business for decades. M&A is increasing the number of large, publicly traded insurers. Purchasing or upgrading systems, hardware and software, and educating a multigenerational workforce about how to maximize these new tools, is costly and labor-intensive for a company of any size, but it's a material consideration for companies being held to quarterly performance metrics.

And given the importance placed on relationships throughout the industry's distribution channels, an increasing focus on data-driven operations can lead to a culture clash where the traditional ways of doing business are mightily resistant to change. This dynamic is symptomatic of a general complacency that's plagued our industry for years.

However, as emerging risks like climate change and cyber continue to evolve in real time, and as, increasingly, a premium is placed on the ability to gather and analyze data (also in real time), there's no room for complacency—not if we want to stay relevant, let alone increase our relevance. Systemic, organizational and operational changes are required.

And to unlock the value in technology and effectively respond to a world of new risks, we need the right talent.

Again, an obvious statement of fact, but one made against the backdrop of an industry that continues to grapple with an image problem and a talent crisis.

Few high school and undergrad students give insurance a second thought as a compelling career choice. Many look at the demographics of our sector and don't see themselves reflected. They also pigeonhole the industry as boring and conservative.

If we're talking about what makes us relevant, it's presenting opportunities to young people that resonate with their sense of self and their generational need for a sense of purpose. It's establishing work environments that genuinely and authentically acknowledge and welcome the diversity of the world we live in.

The irony is that solving the talent riddle is likely to address the challenges related to technology. The digital natives entering the workforce will have the skills we need to provide products and services that are relevant to the digital world. It's one they were born into, and one they understand well.

I don't think this is a chicken/egg equation. It's more a “build it and they will come” proposition: Offer a compelling reason to be part of an industry in flux to the right talent, and informed, astute choices will be made about what's needed to get the data-driven job done.

Kate Smith is managing editor of Best’s Review. She can be reached at

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