Ellen Clarke reports on the many ways in which technology is strengthening client relationships.Information technology has been characterised as the “crude oil” of today's economy, while the internet is being given equal rank with the economic impact of the steam engine, mass production and machine tools in a prior age.
As powerful as technology may be, however, its benefits do not accrue automatically to any sector of business activity. This reality raises an overriding issue for the insurance industry: How can we best harness the potential of Web-enabled tools to deliver solutions and service globally, with increasingly higher levels of quality and speed?
The key to answering this question is to make certain that our clients are the foremost priority in the technology-decision chain.
Recent client research conducted by Marsh reveals that the vast majority of our clients want face-to-face discussions, negotiations, and other interactions with their risk and insurance advisors. Our clients' programmes generally are complex, involving multiple insurers and numerous areas of specialty coverage and risk management - all at a time when globalisation is exploding. This is why clients want and value the expert knowledge and advice brokers bring to the table, as well as our ability to execute the insurance transaction to transfer risk.
This client-broker relationship sets the broad technology agenda for our business. The powerful connectivity and information-delivery capabilities of the Web will produce the maximum benefits when they are used to enhance our work as close partners with clients, especially when the barriers of distance and time zones stand in the way.
A case in point: Marsh has built a Web portal called InMind that allows clients to log onto a secure site from anywhere in the world. Once online, they can use an electronic service plan to interact with their service teams on a 24/7 basis. Professionals on both sides, from widely dispersed locations, can track each action item, its due date, and the progress toward completion.
In addition, the portal provides access to benchmarking tools and a wide range of information sources on risk, insurance, financial, and business issues. One feature lets clients tap into a proprietary source of risk and insurance information, country-by-country, that is kept up to date by our professionals around the world. Clients can also use the portal to track claims and order surety bonds and certificates of insurance. The latter functions can reduce to minutes processes that previously could consume days.
This is a striking case of a Web-enabled tool enhancing the traditional client-intermediary relationship, instead of changing its fundamental dynamics. There are numerous other ways the power of the Web can help us work with our clients to manage their risk, insurance and benefit programmes more efficiently and effectively. To illustrate, I'll cite several examples from Marsh ‘s experience since they are the ones I am most familiar with:
• The Marsh STARS risk management information system has long been used by clients to access large volumes of loss, exposure, and property information and to manipulate it in ways that identify key cost drivers. Now, a Web-based interface to the system provides users access to the system through the internet, which is a particularly valuable capability for mid-size organisations.
• In the area of employee benefits, Web tools are helping human resource managers stay on top of the fast moving changes in pricing and regulation. Marsh's Benefitsmart.com provides timely information on regulatory and market conditions. Our Benefitsite.com site is an internal communications resource that client employees can easily and quickly access. Again, these applications are especially valuable to mid-size organisations.
• Technology is also a key to serving Marsh's consumer segment, which consists principally of affinity groups and employee work-site programmes, as well as high net worth individuals. Our Seabury & Smith unit currently provides, and is expanding, technology-based self-serve capabilities, which is a key client requirement in many parts of the consumer sector. In the work-site area, individual employees may sign up for several different products, such as auto and homeowners insurance and purchase each from a different provider. Seabury & Smith provides the interface that makes sure the correct amounts are deducted from the employee's paycheque and then are transmitted to the right vendors. In fact, Seabury & Smith regards technology as one of its core competencies and sees the emergence of the Web as a resource that will enable it to build on its success in serving its consumer clientele.
• Our Guy Carpenter reinsurance broking operation, which serves insurance and reinsurance companies, is now using powerful financial modelling tools to develop sophisticated profiles of client exposures to catastrophes by geography and product line. This enables each client's risk portfolio to be balanced much more precisely. Another big success story at Guy Carpenter is the use of imaging technology to totally eliminate paper from the processing and settlement of claims, which increases speed and cuts costs.
• Technology-based financial tools also have been put to work for our corporate, public entity and professional services clients. These resources help determine the best tradeoffs of risk retention and risk transfer, support risk management audits and surveys, and provide simulation software for evaluating enterprise and integrated risk approaches
• As already noted, a major component of service to clients is executing the insurance transaction. This, too, is a complex process involving specialised knowledge. But the submission and exchange of information - the commodity part of the process - remains paper-intensive, costly, and prone to errors. Marsh is working with the insurance markets to develop Web-based exchanges that could eliminate, or at least drastically reduce, these inefficiencies. In Seabury & Smith's affinity business, we provide end-to-end processing now, dealing with thousands of transactions a week.
The above applications and developments are just a sample of the ways in which technology is strengthening client relationships by enhancing communications, providing easier access to intellectual capital, and fostering efficiencies.
Perhaps the subject of technology and its future in the insurance industry can be best summarised by stepping back and viewing the broader global picture. One of Marsh's core strategies for the past two decades has been to build a worldwide presence consisting of offices in all the major countries and specialty practices whose experts operate across national borders to deliver focused expertise when and where it is needed. Messaging systems, intranets, and extranets - which connect not only our professionals but also our clients - knit these resources together seamlessly. It no longer matters if a client problem crops up in one part of the world and the expertise needed to solve it is on the other side of the globe. Through the collaborative power of technology, we can bring the right expertise to bear when and where it is needed, including facilitating face-to-face interactions by our professionals when required.
This capability serves as a basic definition of the connected enterprise. It is one that is not only wired internally and externally, but which uses the Web and other technology tools to bring clients, business partners, and the firm's professionals into new, more productive working relationships. This vision is an excellent roadmap for the further application of technology in our industry as the future unfolds.
Ellen Clarke is chief information officer at Marsh Inc.