Financial services

Technology critical to insurance industry outlook

15 May 2008

Insurity and Microsoft have released a survey that details the role technology will play for insurance firms recruiting those in the ‘millennial generation’ as potential employees and customers.

Those born between 1981 and 2000 are the focus of the Millennials in Insurance Survey 2008, which was conducted by KRC Research. It found that millennials want to use newer, more innovative technologies in the workplace and also have heightened expectations as to how insurance companies should interact with them as consumers.

“This is an industry still struggling with ‘green screens’ on desks, legacy mainframes in the back office and an employee population rapidly approaching retirement age,” said Bill Hartnett, director of US insurance industry solutions at Microsoft. “Insurance companies face serious challenges in attracting millennials into their work forces and interacting with them as consumers. We believe technology can play a constructive role in addressing these issues.”

Because of this proclivity to use technology in their personal lives, millennials surveyed had expectations of their employers providing similar technologies for their use in the workplace. These included company-provided PCs (76 per cent), mobile phones or smartphones (48 per cent), internal company instant messaging (50 per cent), access to social networking sites (40 per cent), company intranet or portal (62 per cent), and company-provided virtual meetings (42 per cent).

The research also suggests that technology is a recruitment driver for the insurance industry, which faces a shortage of new workers; 60 per cent of its current employees are older than age 45. Around 91 per cent of millennials stated that being able to work with “newer, innovative technologies” in the workplace would make them more likely to consider a potential job opportunity.

There may also be issues with the insurance industry recruiting millennials as customers. The majority surveyed currently interact with their insurance companies via phone or call centres (55 per cent) versus the Web (8 per cent). However, when asked about their preferred methods of interaction, millennials are less likely to choose phone or call centres (35 per cent, down 20 percentage points) and more likely to gravitate toward the Web (13 per cent, up 5 percentage points). When asked what technologies companies should adopt to better serve customers, a large percentage of millennials ranked the following as “important”: personal Web portals with full view of their accounts (86 per cent); Web-based support (89 per cent); automated phone responses (69 per cent); live online chats with agents (76 per cent); instant messaging with agents (67 per cent); company blog to post concerns and questions (69 per cent); and mobile alerts (59 per cent).

“In our experience delivering solutions to the insurance industry, we’re seeing carriers starting to put consumers at the centre of their experience, using technology and tools to provide more transparency, control and functionality in their products and associated processes,” said Bill Dochterman, vice president of marketing at Insurity. “This is in part driven by overall market dynamics, but also very much a reflection of this new wave of millennial workers and consumers.”