disruptive insurance technology

Today we’re going to have a discussion about the rise of chatbots.

But first a little table setting…

Before Charles Lindbergh earned the recognition of the world for the first solo flight across the Atlantic Ocean, he was an airmail pilot.

After graduating from the Army Air Corp’s flying school in 1925, he and a partner won the airmail route from St. Louis to Chicago.

Navigation systems were non-existent, so getting from St. Louis to Chicago (via Springfield and Peoria) was definitely a ‘seat of the pants’ affair, flying from landmark to landmark. Not only that, but weather forecasting was in its infancy.

As a matter of fact, during his short airmail career, Lindbergh had to parachute out of his plane twice because the weather got so bad he could no longer see to navigate and land.

As he prepared for his flight across the ocean, he studied all he could learn about transoceanic navigation, using the high tech of the era, a fancy compass, a way to measure the ‘drift’ of his aircraft, and navigating by the stars.

Lindbergh went so far as to attend a U.S. Navy conference on navigation, hoping to learn from the experts.

He was surprised to find that he actually was the one with the answers, having studied so much in preparation for his voyage. Everybody looked to him as the one who had the most practical knowledge.

All that work culminated in a successful solo transAtlantic flight when he landed in Paris on May 21, 1927.

No doubt, an incredible, almost miraculous achievement.

Think about how that trip would have been planned with today’s technology:

  • Take off from Long Island,
  • Follow the prompts on the screen,
  • Land at Le Bourget airfield.
  • Done!

Nothing incredible or miraculous in that trip. Routine at best.

SEE ALSO: Jeff Roy Explains the Insurance Customer Experience 3.0

Technology Changes Behavior

The Global Positioning System or GPS is a satellite based navigation system that is the modern successor to land based radio navigation systems of the mid 20th century.

GPS is based upon a network of 24 transmitting satellites, and if your GPS receiver can ‘see’ at least 4 satellites, you can get a position fix, accurate to within 10 feet.

Amazingly, this technology is getting to be ubiquitous. Think about how many GPS receivers the average household now owns: One in each car, one in each phone, not to mention optional items like dedicated mapping tools.

Just the other day I saw a GPS tracking device that reports its location via cell service and is smaller than a golf ball sliced in half. Stick one in your kid’s backpack and you’ll always know where your kid is (or at least the backpack).

This powerful and revolutionary technology is transforming behavior. As an example, take our very own Sydney Roe.

Syd, is a recent transplant to Minneapolis. She’s originally from Florida, with a stay in Washington DC prior to her arrival. Like most millennials, she uses technology to its fullest.

In other words, she depends upon GPS to get her from point A to B. In her own words:

“I just turn left where it tells me. If it didn’t work, I’d be lost.”

Opportunity Beckons

Technology when applied well is wonderful; implemented poorly, technology can be a complete train-wreck.

Running an insurance agency is a juggling act. Running an insurance company is the same, only with more regulatory headaches.

In either world, much of the work involves client interaction.  Many of those conversations are fairly routine, but just because we know what the difference between comprehensive and collision coverage is, doesn’t mean that our client do.

As we explored in the ‘The Rise of the New Normal‘, the problem is exacerbated by consumers’ increasing expectation that our businesses mirror their always-on, 24X7 lives.

A question at 7:45 PM  is just as important to your client as that same question at 9:30 AM on a Tuesday. The difference is your organization’s ability to respond.

Enter the chatbot.

Believe it or not, the first primitive chatbot held a conversation over 50 years ago. Today, chatbots are everywhere: Facebook, your iPhone, Amazon Alexa.

Speaking of Alexa, did you know that at least four insurance brands are partnering with Amazon to connect with customers via Echo?

  • Grange
  • Nationwide
  • Safeco
  • and late last week, Allstate.

But there are others too. Unless you’ve been selling kool-aid out of a street side stand for the past 6 months, you’ve heard of the new insurance company, Lemonade.

Lemonade’s claim to fame is that they’ve built their product on Behavioral Economics and Artificial Intelligence or AI.

And that AI powers their company and their chatbots, responding in sales, customer service and claims conversations.

The early adopters of chatbot technology aren’t only big insurance companies or new entrants flush with VC money.

Excalibur Insurance Brokerage (that’s an agency for those of us south of the permafrost) from Canada even has a chatbot, Aiden. Hell, Aiden even has her own entry on the Excalibur team page.

Jeff Roy, CEO of Excalibur Insurance, is forward looking and knows a watershed technology when he sees it.

So he’s experimenting now, ahead of the curve.  If you want more of the details on Jeff’s take, check out: Chatbots: Soon to be the Siri of Insurance

‘Lost’ Insurance Buyers?

The power of chatbots is that they more closely match the communication style that more and more is becoming the norm. Short, and to the point. Messaging is replacing email and telephone conversations.

Think Snapchat and Instagram.

Ask a one sentence question. Get a one sentence answer.

No, complex insurance problems aren’t going to be answered in one sentence. And yes, there are potential E&O implications of automating responses. However, that can’t be a reason not to get started with this new technology.

Here’s why…

Just like GPS, getting information that you need, when you want it, is going to become expected. It’s going to be the ante just to get in the game.

A good friend of mine told me a story a couple of years back. He had just picked up a new customer via Facebook who was leaving one of the captive agency companies.

Her reasons were simple. She wanted to work with an agency that had 24X7 access and was responsive.

He confided to me that while he was responsive, he didn’t have the 24X7 part in any way.  Wonder if she is still his customer today?

When 100% availability is the norm, insurance buyers won’t accept anything less. They will change providers just to get it.

SEE ALSO: This Agent Sells Insurance to 65-Year-Olds through Text Message

Long Story Short

If Syd broke her phone, she could learn to navigate the old fashioned way. But, odds are good she’d buy a new phone first. With GPS, it’s so much easier.

Communicating via messaging is so much easier too.

I know what you’re going to say,

“My customers need customized service and advice. Their questions can’t be answered by a robot.”

How many of the inbound customer service requests that you receive need the analysis and coverage decisions of an insurance professional? Eighty percent? Is it even fifty Percent?  I doubt it.

Survey your teams. Odds are that the majority of your service requests are simple repetitive questions. The kind that are fully capable of being answered by a chatbot.

Chatbots free your team to to do what they are best at, provide expert analysis and coverage advice.

Some will look for the shallow, quick win. Just like an automated phone tree, they will see the benefit of new technology to be primarily cost reduction through the elimination of head count.

The businesses playing the long game will implement chatbots slowly, with the goal of adding additional capabilities and allowing their human staff to do a better job for their customers.

I hope you fall into the former.

Good Selling,

Marty Agather

P.S. Come see Jeff Roy live at Agency Nation Elevate 2017!

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