#Insurance360: Pros assess 3 top insurance trends

Ohio Insurance Institute Insurance Education Day 2015 panel

Ohio insurance company CEOs (l to r) David Kaufman, Motorists Insurance Group; Tod Carmony, Wayne Insurance Group and Jim Kennedy, Ohio Mutual Insurance Group share “A View from the Top,” fielding audience questions through panel moderator, Dean Fadel, Ohio Insurance Institute.

April 15 was more than Tax Day for Ohio insurance professionals. It also marked the 2015 Ohio Insurance Education Day, an annual event hosted by the Ohio Insurance Institute.

About 200 from insurance companies and agencies, along with students with an eye on insurance careers, attended this year’s program that focused on the state of the industry and its changing landscape.

Below is a recap of some of the key insurance trends shared during the event, including tips on how insurance pros can remain competitive in future markets.

Plan Ahead: Cyber security threats will impact everyone

In the wake of the Target, Home Depot and Anthem security breaches, it’s no surprise that, “Cyber security is the top topic being discussed at the national level for all insurance companies.”

Ohio Department of Insurance (@OHInsurance) Deputy Director Jillian Froment reminded insurers that you cannot insure enough against a threat that requires a “constant maintenance of effort” to protect customer and company data for companies of all sizes.

Hartford Steam Boiler, Munich RE (@htfdsteamboiler) Assistant Vice President and Market Development Manager Corey Dunbar (@DunbarCorey) echoed Froment’s sentiments. He stated that insurers must proactively prepare for cyber risk incidents, particularly small businesses that provide hackers with entry-level access to larger, national corporations (think Target).

Dunbar suggests several ways insurers can plan ahead amid growing concerns:

  • Have a written cyber security attack plan in place. As you define your company’s approach to this unique risk, consider implications for outside experts and internal teams, such as PR and legal support. Plot out the immediate next steps each team should take in case of a security breach.
  • Educate your teams on relative risk. Keep your network of agents and policyholders updated on the latest cyber security risks and recommended precautionary measures.
  • Roll out cyber coverage as a core offering. Attacks and breaches are a costly affair. Businesses of all sizes are considering cyber risk insurance to prevent financial ruin. Start small if necessary, but include cyber risk coverage into your core offerings.

Technology take-over: Disruptions will change how you operate 

If insurers want to remain relevant, adoption of technology is essential. Those who fail to adapt face extinction.

As PR 20/20 CEO Paul Roetzer (@PaulRoetzer) explained, much of this is the result of an evolved customer journey process. Customers want to discuss and research options prior to purchase. It has become an insurer’s mission to “be there when your customer is searching for a solution” — through impactful web content and a powerful social media presence.

But it doesn’t stop there. Companies with clout, like Google and Amazon, are coming in for the kill. They’re poised to disrupt insurance channels and provide customers with tech-centric experiences that they’ve become accustom to before insurers do.

Ohio Mutual Insurance Group (@Ohio_Mutual) President and CEO Jim Kennedy stated that a “perfect storm is happening,” which calls for a new approach in the quest for relevancy:

  • An uncertain economy
  • Cautious consumers
  • Massive changes in employee demographics within the industry
  • Relatively new tech use
  • Enormous shifts in how consumers want to be marketed to by all kinds of companies

In response, Kennedy shared a four-step approach insurers should consider in order to sustain and grow their markets:

  • Quit living in the past. Get over accepting old standards for new issues.
  • Face the fact that customers want to be dealt with differently today. Take advantage of tools that will help you reach customers in new ways. Kennedy states, “We’re getting a pass right now with customers, but that won’t last for long.”
  • Realize that carriers employing a network of independent agents are in just as much trouble as other types of distribution channels. Embrace and don’t fight the changes to come.
  • Find a way to add value in increasingly complex client relationships or accept defeat. Disruption is coming to our distribution models—be ready to rethink your approach.

Advancements will be incremental as traditionalists adopt new ways of doing business. Insurers agree, however, that teams need to combine efficiency and technology for maximum benefit moving forward.

Prepare for the next wave of insurance talent

The need to attract and retain young talent is arguably the most important and widely discussed topic in the industry.

American Modern Insurance Company, Munich Re Territory Sales Manager Tony Canas (@TonyCanas4) reminded attendees that the industry is currently highly swayed to baby boomers. It’s only a matter of time before the industry begins to feel the widening talent gap.

Canas shared two staggering statistics:

  • 43% of the industry is set to retire in the next few years.
  • By 2020, millennials must to account for 50% of the workforce to keep the industry afloat.

What does this mean for those currently in the industry? Veterans heading toward retirement must nurture and position young talent to take their place.

Millennials (adults between 18 and 34) want to be challenged, have a positive impact on the world, be provided an opportunity to advance, want flexible work schedule options and the ability to apply the latest technologies. It is your job to show them that what they seek can be readily found in insurance.

How can insurance companies provide the environment millennials seek from day one?

Canas had a number of suggestions, including:

  • Get their first day right. A millennial’s first day on the job is crucial. Make a positive first impression by having their computer, workplace and business cards ready. Greet them at the door and make them feel like a welcome addition to the team.
  • Offer a clear and objective evaluation system. Millennials come from a video game generation that wants to know how they can “level up.” Provide them with a clear evaluation matrix that includes set goals, objectives and instruction on how to advance in their career.
  • In tandem, give honest and constant feedback. Positive and constructive feedback should be delivered weekly. Also take the time to teach and coach millennial talent on how to receive feedback as a tool for growth. To this end, Canas recommends adding Thanks for the Feedback by Douglas Stone as a required read during orientation.
  • Make them a part of a larger goal or greater challenge. While personal sales goals are important, millennials also want the gratification of contributing to a larger mission/goal. Communicate the importance of their role in the company and the clients they serve.
  • Ask for their opinions. Do this often.
  • Offer mentorship to help them see possible career paths and potential.

Top takeaways

Brace yourselves, fellow insurance professionals, for change is on the horizon.

Keep alert for cyber security risks and embrace technology that will help your organizations transform to meet new needs. Show the next generation of insurance talent the way toward a powerful career in an industry full of growth and opportunity.

Did you miss Insurance Education Day Conference, and want to take a look at this year’s presentations? View archived presentations from this and other past OII events.

Posted: May 14, 2015