Triaging means prioritization—taking collision claims and dispatching them to the appropriate appraisers or salvage shops based on accident location and severity. White boards and human dispatchers armed with three telephones and a dry marker are giving way to electronic triage and wireless claims appraisal at the vehicle site. “Claims management now encompasses a full range of processes,” says Tom Lee, a senior director of product management at ADP, a leader in Web and wireless insurance management and dispatch products. “It’s not just [claims] estimation with mobility, but processing the entire claim—from first notice of loss to
post-claim vehicle re-inspection.”
The change is subtle, yet reflected throughout the insurance industry. Mobility products such as ADP Claimsflo Wireless, a system enabling adjusters to “walk the vehicle” with a mobile terminal, filing estimates and even cutting claims checks on the spot, are part of an across-the-board applications approach. Many insurance systems integrate components of Web and wireless together. For example, mobile CRM systems for salespeople toting PDAs or laptops are spreading throughout the tier-one insurance companies. Global positioning systems in cars and laptops help pinpoint agents. Wi-Fi hotspots speed up claims processing uploads. And agents are beginning to use secure VPN tunneling from smartphones and handheld devices to access live claims or customer profile data on corporate intranets.
Slow but Steady
Traditionally, insurance companies are like camels—dependable though slow on the uptake. “Wireless hasn’t penetrated that greatly, although large
companies are starting to do it,” says Kimberly Harris, a VP and director of financial services research at Gartner. Harris cites a Gartner study conducted in November 2004 of 57 U.S.-based insurers with over $100 million in net premiums. Only 11 percent of all property and casualty (P&C) companies surveyed allowed claims adjusters and the claims service supply chain to access information via mobile devices. Only a tenth of life and health (not counting medical insurance) and 3 percent of P&C companies allowed consumers access to insurance information via a wireless device. However, the figures were slightly better for insurance distributors (brokers). Twenty-nine percent of life and health and 14 percent of P&C distributors can now enter an insurance portal wirelessly—perhaps a sign that the industry is waking up to the possibilities of mobile adoption, Harris suggests.
However, “insurance is still very much at the low end of the [adoption] curve,” she continues. “Although typically, we’re hearing more about the use of PDAs for gathering information and calendaring, while adjusters are using tablet PCs to process claims. Not that many start-ups are offering something different from what the insurance industries are building internally,” she says. For example, many of the insurance company IT departments are extending CRM systems—Computer Sciences, SAP, Siebel—to wireless devices themselves.
Even when companies do offer mobility, agents and brokers sometimes resist adoption, according to Jerry Goedicke, president of Mobitor, a San Ramon, Calif.–based mobile applications developer for vertical industries. “Actual compliance using the CRM system is extremely poor among [insurance] salespeople,” he claims. “One of our clients could not get its sales force to use a laptop-based CRM system. It was too complex, and the agents essentially were
having to relearn it every week.”
Comply or Else?
Why, then, do insurance carriers adopt wireless? For Jamie Diamon, an architect in charge of mobile computing at Nationwide Insurance, the issue is business process compliance. “We’re requiring more wholesalers to enter more information into Siebel and doing more with the CRM tool,” he says. For example, a field-deployed Nationwide investment product wholesaler can use a CRM wireless application to get immediate real-time access to information—say, entering an order to send literature to a client, rather than calling an
internal sales rep to handle it for him.
“The efficiencies we’re expecting from mobility [reflect] mostly changes in how we do business,” he says. Consequently, Diamon sees wireless benefits as about “50 percent convenience, 30 percent business process compliance and about 20 percent productivity improvements. I’d expect some productivity increases,” he added. “But that doesn’t mean a wholesaler needs 33 percent more sales because he has a wireless device. What it does is help more in prospecting than in bumping up sales.”
But Dan McDonald, a director of marketing for Nokia Enterprise Solutions, disagrees with that view. “People are looking for the killer application in insurance. I’ve talked to insurance agencies over the last six months, and [the killer app] is a response to claims and increased sales,” he observes. “On the claims end, productivity gains are easy to understand: Agents show up with an IBM laptop and a multi-radio wireless card with cellular and Wi-Fi connectivity, which they place on the hood of their cars. They’re able to confirm on the fly that a person or business has insurance coverage; they gather information and upload it, and the service is pleasant and responsive. Moreover, there’s a cost reduction for the insurance company.
“On the sales side, insurance companies are using wireless to sell other kinds of financial products, such as mutual funds and other investments,” concludes McDonald. Although response and satisfaction from agents and field workers has been “phenomenal,” companies are looking for more portable, robust wireless tools. “They’re searching for a converged device with better battery life than laptops, lighter weight, better coverage and usability.” Better wireless also means broadband and smartphones with full widescreen keyboards.
McDonald believes these requirements will be met in the coming year. “Before, the insurance companies [I contacted] told me they had a couple of hundred pilot mobile units [in the field]. Now, with the hurricanes and tsunamis, they have thousands. This will be the year mobility in the insurance industry becomes standard.”
One area where wireless seems assured is in claims processing. A leader in the claims field, Progressive Insurance already has more than 3,000 specially outfitted immediate response vehicles around the country that appraisers operate as mini mobile claims offices, according to Christy Cote, a Progressive spokesperson. “Each is equipped with laptops that establish a wireless connection to various Progressive systems so that those in the field and back in the office can communicate efficiently and share information necessary to settle claims accurately and quickly,” she explains.
Progressive claims its mobile technology is increasing productivity “by reducing drive time and eliminating steps in the communication and documentation process.” The company, however, will not reveal productivity improvement figures—a silence that seems almost ubiquitous in the insurance industry. “Because the technology is integrated with our workflow, it’s hard to separate the true cost savings in dollar figures,” Cote remarks.
However, the company has gone far with innovative customer-driven ideas, she claims. One use of mobility is in customer paging, part of a new “concierge level of claims services centers,” Cote says. When customers drop off their damaged cars, they get a rental car and a pager and drive away. The company finishes the estimates and repair work, then pages the customer when the vehicle is ready for pickup. Progressive has also offered its insurance customers wireless Web access from cell phones and PDAs. “Consumers can now manage their insurance information from anywhere at anytime, including the ability to make payments, find a local independent agent and look up vehicle recall information,” Cote observes. These capabilities put Progressive in a distinct leadership position—and in the minority.
Mobile CRM—The Far Frontier?
At Nationwide Insurance, by contrast, the emphasis is on mobile CRM. The company is developing an in-house client for the Palm operating system, actually a wireless extension of Siebel’s CRM system, says mobile architect Jamie Diamon. Mobile CRM systems will equip Nationwide’s 250 top-producing investment product wholesalers (the company sells its own mutual funds to insurance brokers as part of its portfolio of services). The wholesalers will be the first to have
on-the-fly access to CRM data about high-stakes
“For example, our wholesalers may want to know how much a certain fund broker sold of our investment products in the last six months, so [they access] the CRM data that resides back here on our distributed Siebel system. When you add the handheld client, you get a subset of data.” Nationwide decided to write its own client to improve usability on the handheld. “Our CRM application looks like the Palm calendar, our Address Book looks like a modified [Palm] Address Book and we have a highly modified To Do list,” Diamon says. When agents get Siebel data, “it feels like Palm address data, natural and intuitive to use.”
The application allows Nationwide wholesalers to drill down into broker/client data, such as contact information, financial institution affiliation and licenses. “If the agent clicks on ‘production,’ he or she sees information on annuities, premiums and assets—e.g., annual sales,” says Diamon.
War Over Form Factors?
Interestingly, the company has eschewed laptops for the application, instead adopting the lightweight palmOne Tungsten T1 and T2 to support CRM. Diamon says the company is now considering a move to the advanced palmOne Treo 600 or 650 smartphones, which offer both PDA data and cellular capability. “Because we’re not doing transactional data, and the data don’t change on the fly (it’s batch-generated every night), a laptop or PC isn’t required,” he says.
What is required, though, is stringent support for security protocols, including IP-sec VPN client capability, which assures secure “tunneling” from a wireless device (e.g., the Tungsten T1) into a corporate intranet via the Internet. Nationwide buys its secure VPN client for all its applications from Certicom and palmOne, and is now considering a move to “more heterogeneous groups of hardware in the field,” including the Treo 650, the first palmOne combo phone equipped with an IP-sec VPN client. With the transition to new hardware, though, Diamon realizes he must now contend with ever-faster hardware lifecycles. “The hardware becomes unavailable six months after it’s introduced,” says Diamon. “Because the ratio of change is faster than the desktop market, you have to be aware that the platform is changing the ground under your feet.”
The faster, more powerful, smaller mobile devices for insurance CRM will likely shake up the industry. “Ninety-five percent of the mobile sales agents today don’t take their laptops with them, so they’re faced with a big administrative burden when they return to an office,” says Mobitor’s Goedicke. “But when salespeople out in the field have deployed CRM on handhelds, they can now take 50 percent of that office time and capture four to six hours more a week in the field,” he asserts. “That means spending more face time with customers. And, says Goedicke, “that translates into increased sales.”