Our next episode in our series Biz, Tech & Brains (Experiences directly from the market – C Suite) – A very interesting and insightful conversation with Mr Peter Levy (Managing Director, British Caribbean Insurance Company Ltd.). A Visionary, a Strategist, an Innovator, a Change Driver.
A lot to share on Peter’s vision on technology, his views on the importance of customer satisfaction-based business modelling and expectations from Insur/Tech in achieving that!
Diving right in…
Manomay: What’s your personal vision on technology for business in an ideal world scenario?
Peter: Technology is an enabler. Not just to do things better, faster, or cheaper, but on a higher level, Technology enables us to do things that previously were not possible. The starkest example for me is the traditional strategic choice between cost and quality. It’s traditionally considered a binary choice – you had to choose one. Technology can break through that barrier and allows you to deliver significant differentiation on service, at a cheaper cost.
My vision on technology is that it breaks down the walls of normal, and creates new possibilities
Manomay: That’s great, what do you think should be the key technology focus areas for Insurance Companies primarily from business context and why? For ex, Process Optimization, Customer Satisfaction, Data Driven Decisions, People Centricity, etc.
Peter: We don’t start thinking about technology until we have thought about what customers want. The examples you have given (process optimization, customer satisfaction etc.) are places where technology can make improvements, yes. But the customer satisfaction piece is the magnet. That’s the north star. The whole perspective changes, with focus now on the question of where and how best I need to apply technology to give customers what they want. For ex, doing process optimizations, without customer satisfaction being your primary goal, could see you optimize the wrong processes that do not bring value to you or your customers. That’s a waste of money.
I think the business needs to pull value from Technology. Technology cannot be the driver of value.
Manomay: Totally agree. So, from a Customer Centricity context what do you think are the customer demands that are not taken care of by the Insurance Industry today?
Peter: We try to think in terms of ‘What role does insurance actually play from the customer’s perspective’. Insurance is defensive, and what we are providing is peace of mind. We want to build on that definition by asking “What is it that is interfering with my customers’ peace of mind, and how can we design our products/services to address those concerns?”. The traditional approach is, “This is our triangular-shaped product and if you have a triangular-shaped hole then this is the right product for you.” Instead, we want to say, “Okay what is that you need and what shape do you need it to be?” Then we try to build that in a way that the customer is satisfied, and we can make a margin. That’s how we take that Outside-In perspective and go all in on it.
We need to erase the traditional approach from our construct and say, “Let’s go from the customer to the product instead of the other way around”
Manomay: Agreed, do you think as a Company, sometimes you might be bogged down by the current state – processes, technology, market, people etc. to bring in this shift in thinking?
Peter: I was listening to a podcast, a CIO of a big European Insc Co, with heavy digital investment. He was talking about the ways that legacy holds you back, and he said that it’s not just about your legacy systems, but legacy systems inside an industry which has got a lot of legacy practices, and you are recruiting from within that industry. So, you know you’re not importing anything fresh really. You need to create a kind of greenhouse where those fresh ideas can bloom, because it’s not just going to happen organically. You have to do some fertilising, which I think in the macro sense, Insurtech can do for the industry as whole.
So, how we are doing it? We have made hires for key positions who didn’t have any experience in Insurance. The challenge now is to not let them get brainwashed by the dominant culture but try to get them to preserve their outsider view while we work on changing the culture. The other thing we also did was, create a framework for the front-line team to talk about what customers’ issues are, to come up with solutions & if necessary, to hand over to the manager the responsibility of making those solutions possible. It’s the upside-down pyramid but with a very specific orientation towards listening and delivering customer value.
Manomay: Now, in terms of competition, if biggies like Amazon and others come into the Insurance Industry, what do you think will be the challenge for the existing Insurance Companies? How do you think you can overcome or sustain the competition and move forward?
Peter: If Amazon comes in, that’s a big thing to overcome. We have to create more brand loyalty in our market. We have to create emotional attachments, maybe increase the number of touch points, increase the level of engagement etc. All of those things give us a few more hooks to cement the relationship between us and our customers. But it all boils down to whether we can deliver value in ways that is important to them. Whoever does that will win for sure. Insurance is very price driven and is very much a commodity. Even if there are differences between Insurance Companies unless they are huge, people don’t see that. So, it’s very difficult for us to prove superiority. What I think we can do is create a feeling of safety. If you create that, people will be reluctant to move away from that feeling.
Manomay: Absolutely. Now moving on to tech, what kind of technology do you think is needed for a Customer Centric Organization?
Peter: One of the things we’ve learnt is if you are customer-focused, you cannot plot an exact course from here to where you want to be because you’re actually not in charge, the customer is. Building-in flexibility is super important through technology that supports us doing different things. Tech companies have developed these skills, A/B testing for instance – this vs that. I want to be able to do A/B testing on documentation we send out etc., and even on internal stuff. There is no point testing stuff if you don’t have the ability to change it – to change what doesn’t work and to move towards something better. From my perspective, the biggest attribute our tech solutions need to have is the ability for us to change direction and move where the customer wants us to go, and rapidly. Maybe that translates into low code or no code frameworks – whatever it needs. For every change we can’t be making a call to our vendor and getting a delivery date in 3 months. We need to be changing things quickly. We want capabilities and not solutions
Manomay: Core Platform Vendors today – Do you think they provide the capabilities around Customer Centricity?
Peter: I don’t think so, I’ve only seen a handful of them, and I will be very surprised if any do. Software providers are like any other business, they’re going to key in on the biases of their buyers.
Only if & when Insurance Companies become more focused on the Customer Experience then the vendors will start to move in that direction. I do think Insurtech has the potential to speed that up. People coming in outside of insurance have a better chance of breaking the numbers-driven construct that exists now. The outsiders’ biggest advantage is not having the legacy thinking, resources, tools, or investments. Their focus is all about fixing what’s broken and finding a market that pays for that.
Manomay: Agreed. But don’t you think there is an amalgamation needed because whatever core platform vendors focus on, Insurtech providers don’t and vice versa?
Peter: I’m not sure how representative my experience is or my observations are, but it does seem to me that what we’re seeing now is a bit of a trend away from Insurtech, meaning not so much an approach that says “Let’s start an Insurance Company” like Lemonade or Metromile or Root. Its more saying “Let’s provide technology to the existing industry that allows them to transform how they do business.” This is going to require some kind of interface at least temporarily between the legacy and new. I think that the market will continue to move that way.
Manomay: What is your advice for existing Insurance Companies to take that route?
Peter: Use of data is definitely one tool, and the use of agile. The concept of pivoting is really about, “I came up with an idea but nobody liked it, so, I’m going to take it in another direction and see if people like that.” An agile way of working, fail fast, fail often, fail forward. And if you’re not pivoting around the customer, you’re wasting your time and money.
A very focused mindset of delivering something that is of value to people, that people will want to use is definitely something that I think we need to import into how we think about the business.
Biz Tech Insights Team Manomay
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