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From Resource, February 2008
Fast Forward
Faster, more efficient
service is seen by many experts as a key to success in today’s insurance
industry. Here are several ways insurers can speed service.
By The Resource Staff and
the
Information
Center
Staff.
Faster, more efficient service is seen by many experts as a key to success in today’s insurance
industry. In the 2008 Industry Forecast (published in last month’s Resource)
insurance executives emphasized customer service can be the differentiator that
allows an organization to be successful in attracting and retaining
customers. Technology in particular presents opportunities to enhance
service levels. Here are examples of
how.
Voice
Technologies
Insurers have long used
voice-oriented technologies like automated voice response to provide
self-service capabilities to producers and policyowners.
Though some analysts expected the advent of Internet-based self-service
to render phone-service activity obsolete, it persists and is often seen as a
necessary alternative channel. In fact, voice-based and Internet technologies
have combined (in the form of voice over Internet Protocol) to give insurers
more communications flexibility.
Voice
technology markets have started and stalled over the last 10 years due to
concerns over security and reliability, but the promise of streamlined
connectivity has prompted companies to continually revisit the possibilities and
conduct new pilot programs.
Interactive voice response (IVR)
systems—which can accept voice or telephone touchtone-keypad input from
callers as they navigate interactive menus—are one of several solutions that
insurers are employing or exploring, including:
Speech
Recognition: These computer
systems can recognize general and naturally flowing speech.
The computer can also respond with “speech” to create a dialogue.
Voice
over Internet Protocol: VoIP
enables voice data to be sent in packets over the Internet (similar to how an
e-mail travels) rather than by circuit transmissions on the public switched
telephone network (PSTN). Though
there are upfront costs and maintenance expenses, cost savings are realized in
the area of traditional phone charges, because calls over the Internet do not
incur a surcharge other than fees paid for Internet access.
Voice
Portals: These portals offer
speech-enabled access to Web-based information.
Essentially, they provide phone users with a natural-language interface
to Web-based content.
Voice
“signatures”: Though this is
not a technical subset of voice technology, it does represent a voice
application with particular utility for the insurance industry.
Essentially, some insurers have begun recording and retaining phone calls
as a record of customers’ verbal authorization or agreement during
insurance-application interviews or sales conversations.
Having an audio record of a customer’s assent to a particular
transaction or procedure can eliminate time-consuming paperwork and protect both
the company and the consumer during the dispute-resolution process.
Each
of these technologies presents its own benefits and challenges to insurers.
For example, customers have long complained about labyrinthine,
inescapably loopy voice-response systems.
And
speech-recognition technology has not always been very good at executing what
one assumes is its core competency – recognizing speech.
Even VoIP and IP telephony – which can potentially simplify
communications infrastructure, save money, and provide more flexibility and
communications features to an increasingly mobile workforce and consumer base
– make CIOs nervous about upfront costs and possible security problems.
Insurance
Company Practices
Nevertheless, insurers, though
cautious, are exploring some of the newer technologies, and they’re not yet
abandoning the older ones. (One LOMA
member company installed a new IVR in April 2007 for clients and retail agents
calling its life insurance product line. Others have enhanced their IVRs in
recent years to include or eliminate voice input, simplify menu choices, and
introduce intelligent call routing.)
One Midwestern insurer has
pursued natural-language recognition technology in its customer service area.
In response to customer feedback about its IVR menu, the organization
assembled a cross-functional team to design and implement a new, streamlined
phone system based on speech recognition technology.
The new platform allows callers to speak the purpose of their call in a
phrase or sentence; the system interprets the speech and sends the call to the
appropriate service team through intelligent routing.
The technology is built on a search-engine platform, which matches
callers’ spoken words against a database of more than 30,000 terms.
However,
speech recognition is not just for outward-facing customer service.
Another insurer uses a voice-recognition system in its mailroom to sort
incoming items, mostly those that cannot be read by its optical character
recognition system. One bucket of
postal-service mail, which used to take 45 to 60 minutes to sort, now takes less
than half an hour. Staff simply
stand in front of the sorting bins and state the addressee’s name, then slot
it in the correct location.
Voice-based
systems can also be used to enhance new business, in the form of voice
signatures. A major life insurer now
takes advantage of this technology, which its legal department considers to be a
“subset” of e-signatures. This
process is offered only for traditional life insurance new business.
In the first stage, the application is submitted by Internet, fax, or
mail to the Individual New Business division and agent, which in turn triggers
the medical history interview to be completed by a vendor using a tele-underwriting
phone interview. During this
interview, the client responds to the medical questions and provides a voice
signature on appropriate forms by agreeing to a few statements.
The entire interview is recorded and retained for the life of the policy.
All forms signed by voice signature are stamped with “voice signature
accepted” as a reminder to all
that the signature is recorded by voice.
Another
major company also makes use of voice signatures.
As part of its teleunderwriting process, it works with three third-party
partners to conduct paramedical interviews over the phone with voice signature
technology.
Online
Underwriting
Meanwhile, The Hartford is
speeding up service by use of a new online underwriting process.
Here’s how the company explained the process:
Purchasing
group life and disability insurance at work can be a win-win situation for the
employer, as well as the employee. It protects the employee’s income and
lifestyle while enabling the employer to offer a valuable benefit. Yet in the
past, the benefit had been complicated by inconvenience or hassle because of a
medical underwriting process that could take days or weeks.
Fast forward to today.
Obtaining a decision about coverage from The Hartford Financial Services Group
now takes seconds with a new online Evidence of Insurability (EOI) tool – a
combination of an electronic underwriting process and streamlined medical
underwriting criteria.
“We’re
committed to giving our customers a no-hassle, ‘their-way’ experience,
making it easier to obtain the coverage they need to protect themselves and
their families,” said Mary Ericson, assistant vice president of voluntary
business for The Hartford’s group benefits division. “We recently modified
our medical underwriting guidelines based on our superior risk management
capabilities. This is making group life and disability coverage more accessible
to more people.”
Today,
consumers are faced with more benefits decisions than ever, and they not only
expect but demand a quick and easy benefits experience. The
Hartford
’s new tool allows workers to submit health information 24 hours a day, seven
days a week, reducing the administrative burden on employers.
Additional advantages for both employers and their employees include:
Real-time decisions for most
employees. Decisions about coverage
can be made almost immediately through The Hartford’s medical underwriting
system. Employees who submit
information about their health online receive a decision within seconds as to
whether coverage has been approved, declined, or is pending additional
information. Those who submit
information through the mail will also see faster decisions as a result of The
Hartford’s new streamlined personal health application.
Paperless notification.
When employees enroll for their employer-sponsored benefits, they are
notified by e-mail if they need to provide evidence of insurability.
The e-mail includes a link to The Hartford’s EOI online tool, improving
speed and communication, and eliminating the transfer of paper between the
employer, the employee and The Hartford.
Reminders to submit
applications. Automatic reminders
are sent to employees who have enrolled for benefits but have not yet submitted
their evidence of insurability. The
reminders are designed to reduce the number of late submissions, which can
create additional administrative work for employers.
Streamlined underwriting
requirements. The number of medical
questions that employees must answer about their health has been reduced, making
the medical underwriting process faster and easier. Also, the new streamlined
personal health application presents questions based on the applicant’s state
of residence. This focused process
means The Hartford is less likely to seek additional medical information, saving
time and expense.
Consumer-focused service.
If additional medical information is needed, The Hartford’s medical
underwriting team makes follow-up phone calls to employees, and is also
available to answer questions from employers and employees about applications.
“Making it easier for
employees to apply for both life and disability benefits, managed on a single
platform, helps differentiate The Hartford, especially in a market where
employees increasingly choose and pay for their own benefits,” Ericson said.
“Our EOI process is the first of several enhancements to make our
entire voluntary enrollment program simpler, easier and faster.
The
Hartford
is working to become the group life and disability benefits provider of choice
for employers, as well as employees.”
The
Hartford
, a Fortune 100 company, is one of the largest
diversified financial services companies in the
U.S.
, with 2006 revenues of $26.5 billion. The
Hartford
is a leading provider of investment products, life insurance and group
benefits; automobile and homeowners products; and business property and casualty
insurance. International operations are located in
Japan
,
Brazil
and the
United Kingdom
. The
Hartford
’s Internet address is www.thehartford.com.
Online
Purchase
Online purchase of policies
also offers possibilities to speed service. Prudential Financial, Inc. recently
introduced MyTerm, a simplified issue term life insurance policy available
through the Internet to customers of select banks and other financial
institutions. Through a completely online and automated process that can be
accessed from virtually anywhere, MyTerm can deliver a policy in about 10
minutes to qualified customers that may then be saved electronically or printed
locally.
“We’ve
created this new access point for consumers who look to their financial
institution as their trusted advisor,” said Jim Avery, president of
Prudential’s Individual Life Insurance business. “MyTerm provides a fast,
easy and convenient way for many consumers to select a high-quality life
insurance product that fits within their budget.”
The
buying process and service of MyTerm, which is targeted to the middle market
consumer, are supported by state-of-the-art technology operating in a real-time
environment. From a secure Web site, customers choose from a 10, 20 or 30-year
level term policy with face values between $50,000 and $250,000, issued by Pruco
Life Insurance Company (Pruco Life Insurance Company of
New Jersey
in NY and NJ).
“More
and more consumers are using the Internet to handle their financial transactions
as well as research and buy a whole host of products and services,” says Joan
Cleveland, senior vice president, Business Development in Prudential’s
Individual Life Insurance business. “Giving the consumer the ability to
purchase life insurance when and how they want and in the amount they’d like
is a natural outcome of this rising trend toward online management of one’s
personal finances and purchase decisions.”
NOTE: For more information on
voice technologies or instant underwriting, contact the
LOMA
Information
Center
, infoctr@loma.org, phone
770-984-3720.
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