Leading Insurance Industry Analyst Zeroes in on the Modern Consumer


Greg Donaldson – Senior Analyst at Aité on the Connected Insurance Podcast presented by Agency Revolution

Greg Donaldson – Senior Analyst at the Aité Group

What does today’s insurance consumer want? How do they differ? How do we earn their business and loyalty?

These questions make some agents toss and turn – wondering if they’re keeping up with the changes in the modern world. Our guest, Greg Donaldson, specializes in the heated intersection of insurance, technology, and human behavior. 

Every serious student of today’s insurance consumer will want to listen to this conversation between Michael Jans and Greg Donaldson as they explore:

  • The juicy topic of privacy and data. How much are insurance consumers willing to share? What do they demand in return?
  • Navigating your agency’s path through the torrent of technology that is and will continue raining down on the insurance industry. 
  • Why Greg is encouraging agents to embrace the very technologies that look like they’re going to take their place. 

Do not miss this mesmerizing conversation exploring the research and conclusions of Greg’s recent study on the modern insurance consumer. 

What are other agents & brokers doing to thrive? What are the biggest trends affecting the retail insurance agent & broker? What are the most important strategies and tactics you need to grow faster? Find out here in the Connected Insurance Podcast, where our hosts discuss the biggest issues affecting the independent insurance agent & broker with the industry’s leading figures.

Transcript

Michael Jans: Greg Donaldson, thank you so much for joining us. How are you today?

Greg Donaldson: I am doing quite well. Thank you.

Michael: Okay, very good. I would normally say, “How are you this morning?” But you are in Dusseldorf, Germany. I should, first of all, say thank you so much for giving up your evening for The Independent Insurance Agents of North America.

Greg: No problem at all.

Michael: All right. My friend, the last time I talked to you, you were in Ireland.

Greg: Yes, that is correct.

Michael: Remarkably, terrific audio quality follows you wherever you go. You have been doing some serious work on the insurance industry and some serious work on the insurance consumer, which of course is of tremendous interest to me and to my listeners. That’s what we’re going to be diving into, but I think first, your background is interesting. Perhaps tell us a little bit about how you got to be where you are, and then we’ll dig into what you’re doing right now.

Greg: Sure, I’d be happy to. It’s almost accidental actually. I started with State Farm Insurance right out of college and was fortunate enough in over 25 years with them to work just about everywhere. I was in claims, in underwriting, I was actually an agent for a while and sold policies, and the last role that I had there was in senior analytics position where I basically worked with our executive group and answered their questions for them.

Michael: All right. Okay.

Greg: After having all that background, it was fairly straightforward, but then there was kind of a funky reorganization that really wasn’t supposed to include my team, but wound up including us. I was offered the opportunity to either leave and take a severance package or stay. I looked at my wife and I said, “Well, our kids are moving out of the house, so let’s try and find a job that lets us move to Europe.” She was like, “Okay.”

That led to finding the opportunity with Aite Group where I get to use all of that knowledge and experience that I gained at State Farm, and really cover the insurance industry from the outside in where my focus now is primarily property and casualty.

What we do is, we look at what are the current trends in the industry? What is the biggest impact that our carriers and our agents are facing? What are the vendors that are out there that can really help manage that path? Who’s out there really helping guide our industry and get us to where we need to be? There’s a ton of technology and it’s hard for carriers and agents to really know what’s good, what’s bad, what do we need to be paying attention to? That’s what we try to do, we try to fill that role.

Michael: Got it. I think that most likely your area of focus right now is the relationship between the consumer and the carrier, am I right?

Greg: It is.

Michael: You got 25 years in the agency world and you certainly have an understanding and some appreciation for how this affects the independent agent and the agent in general, so I’m going to, from time to time, ask you to kind of assess your research and with the implications on how that might affect today’s agent, what they need to do about these big trends.

Greg: Sure. I just want to make sure that you understand that even though our reports generally speak to a carrier audience, most of the research that we do speaks, not only to carriers, but also to the vendors themselves, as well as the agents. We kind of cover all of it, we just generally tailor our reports to speak to the carrier because they’re the ones that are making the biggest decisions usually.

Michael: Well, the carriers are the ones who pay the subscriptions on the reports, I assume, but it does make sense. It’s my job to find you and to bring this message to the agency for. Let’s start, if we could, Greg with some of the research that you’ve done on the modern insurance consumer, in particular, the automobile insurance consumer.

You’ve recently published a report on US auto insurance rewards and incentive programs: driving forward, and you came up with some fascinating findings about today’s consumer. Let’s start with that.

Greg: Sure. One of the things that we wanted to do, and this whole project started late last year, we wanted to try and figure out is data sharing something that consumers are willing to do? Because ultimately insurance carriers, agents, everybody, we can’t function as an industry if we don’t have enough data. For years, the data that we’ve collected has been really basic stuff. I mean, think about not that long ago, you could go in and get an auto quote, just with gender, date of birth, how long have you been licensed, do you have previous insurance? What kind of car are you driving? I mean, it’s that straightforward, but does that really tell an insurance company how well you’re going to drive if you’re going to be their customer for 15 or 20 years?

Michael: Right on.

Greg: Does that change?

Michael: That really is the law of large numbers? You got a whole lot of people in that category to give you that tip of the iceberg information, and then they have to develop underwriting criteria around that. Okay.

Greg: Sure.

Michael: Where are we now? I mean, obviously, it seems that there’s a tremendous amount of data that’s available either publicly or privately and that is valuable to this industry, but it would seem that there are also some barriers to that.

Greg: Yes, there are. The example that I like to use the best is one that really doesn’t apply to auto insurance, but I think it’s one most people can identify with. Think about a Fitbit. You’ve got this phenomenon where people all over the world are wearing devices on their wrists that count how many steps they are, It can measure heart rate, It can measure sleep patterns. Those are some great data points that they’re collecting on a daily basis and they’re using those devices.

One of the things that we asked in the survey was, are you the type of person that even uses a device like this? We went through a whole range of devices, everything from those types of devices, to are you using smart things in your home, like the Internet of Things type stuff? Are you using other health-related devices, smart scales, things like that?

For the auto piece, we focus primarily on two things, a basic description of what a telematics device would be. Something that monitors your trips while you drive and maybe provides feedback. Then we also asked about integrated driving systems. Something like Android Auto or Apple Car or something like that.

What we wanted to try to find out was, A, do consumers even use these things; and, B, if they use them, how often do they use them? Is it a regular thing? What made this study unique is rather than go and just straight up ask somebody, “Hey, are you generating a bunch of data, and do you want to share it with your insurance carrier?” We approached it a little bit differently in that we wanted to ask, do you have the device, and are you using it? Do you understand that it generates data?

Once we got that information, then we asked, do you even have an insurance policy? Because we didn’t want to ask people that aren’t insured. They’re not typically going to answer the same way. When we got to that point, now we have a good data set. Now we can ask, “Okay, you’re insured, you’ve got these devices, you’re generating this data, is there something that you would like to trade that to your insurance company for that would be meaningful to you?” That’s where the rewards and incentives things came in.

What we did at that point is we started asking very specific questions about rewards, and we started with just a straight-up discount. That’s the most common marketing ploy to get consumers to use telematics devices, is, well, you can earn a discount of 10% just by using this device.

Michael: Just by using it, okay. Is that standard that you’ll get a 10% discount if you use it? Because it would seem that some data would suggest that perhaps that driver doesn’t deserve a discount.

Greg: Yes, well, that’s a great point. What happens, because they have to start somewhere, what carriers do is they start out with, “Okay, just start using the device, we’re going to give you 5% on day one, or 10% on day one.” After we start collecting data, that discount can change, you can get up to 30%. I’ve heard from one carrier where it was up to 50%. They said very few will get there, but it’s possible in their system.

That’s pretty much the only real incentive that consumers have had so far, so we wanted to find out is that the most effective way. What was interesting is we started out by asking, okay, if you’re interested in this type of program, what if they gave you 5%? Would you do it? Over 50% said, “Yes, no doubt about it, we would do it.

Michael: Really?”

Greg: Yes, and then there were another 17 or so that were like, “Yes, that’s really interesting. I’m not 100% on board,” but I’m interested. Once we got to those numbers, then we said, okay, let’s take the ones that said yes, at 5% out of the equation; everybody else, what if it was 10%? Then we had a few more that said yes.

Then we went to 15% and had a few more. At the end of the day, discounts up to 15% will get three-fourths of your policyholders on board with a discount.

Michael: Somewhere between 5% and 15%, another 25% are willing to join in.

Greg: Yes. What’s amazing to me though, Michael, is that with just 5%, which is really a drop in the bucket when you’re talking about premium variability, just 5% is getting you between 50% and 65% of the consumers.

Michael: That’s remarkable. Okay.

Greg: That is, think about all the added data the insurance carrier can collect at that point. Your audience is primarily agents, so let’s talk about it from an agent standpoint. If you’re talking to a customer, and you’re trying to tell them about this device, the best way to approach it is if you think of yourself as a relatively good driver, this can’t hurt you. Most states don’t even allow a surcharge based on in any way. Most carriers it’s either zero to whatever the maximum discount is. It’s worth it to try it because it could save you some money.

Michael: Right on, and isn’t it true that almost 100% of drivers consider themselves to be above average drivers?

Greg: Yes. That’s a hurdle for the industry to get over.

Michael: When you say with your pitch line, if you consider yourself a good driver, this could help you, almost everybody would say, all right, it’s worth a shot because they think they’re good driver.

Greg: What’s fascinating though is we didn’t just stop at discounts. We moved on to ask about one other financial types of reward. The best part was when we started as throwing in gift cards, because think about it this way. This is the relationship that we were thinking of. Almost everybody now has some type of grocery store rewards card, you get the extra sales, you get a discount on gas, or you have some type of credit card rewards. Just for spending, you get 1% cashback or delta miles or whatever. What we did is we’re like, “You know what, maybe a discount isn’t going to appeal to everybody.”

What if, let’s say a carrier was to partner with, say, Jiffy Lube and said, “You know what, if you’ll use this for six months, for every month that you use it, we’ll give you $5 off your next Jiffy Lube oil change.” Now you’ve got a partnership with somebody who’s going to absorb some of that cost because Jiffy Lube is going to get the business, they’ll run in there and join you.

You’re providing something tangible in the hands of the consumer, and for some people, that’s more important than just a percentage off your bill that, let’s be honest, insurance bills aren’t the easiest to read. Maybe you don’t even pick up on the fact that you’re getting that big of $1 amount. When we asked about it that way, there was another 17% that that’s the only thing that they were interested in.

Michael: This is 17%, in addition to the 50% or 75%, okay?

Greg: Yes.

Michael: All right. How much of a gift is required? So, you were able to monetize 5%, 10%, 15% discount how much of a gift is required to incentivize that 17%?

Greg: We use the same scale, so the way we asked, like when we asked about 5%, we did it on the standpoint of, okay, let’s say your annual auto premium is $1,000. If you were going to get $50 off, and then we said or 5% would that be enough and we did the same with gift cards, we use that same $50 level.

It doesn’t have to be a significant number. You figure that’s $25 every six months, and you could get people on board, “Hey, use this device for six months to get a $25 gift card at Jiffy Lube,” or some other types of retailer or whoever the insurance carrier wants to work with.

Michael: I don’t know if I asked this question. I’m curious if you had a competition, an AB test, gift cards versus discounts. Was there a winner?

Greg: Yes, discounts did win out, but not by the margin that we expected. I’m pulling these numbers off the top of my head, because I don’t have the reports in front of me, something like almost 40% prefer to discount and a discount only, whereas the gift card number was somewhere around 17%.

The conclusion to draw from this is that just offering one system isn’t going to get the buy-in that the carriers need. You have to have a variable type system, give consumers a choice. Give them a selection option. Do you want a discount or do you want a gift card? That is where the real insights were.

Michael: Now, are you aware, is anybody doing that?

Greg: No, not to my knowledge.

Michael: Got it. All right. Discounts yes, gift cards no.

Greg: Yes, almost every carrier that I’ve talked to is starting with a discount approach. Really the only other marketing approaches that we’ve seen to try to get these devices used from carriers and these are not necessarily in the US. There are some here in Europe that are taking the approach that they don’t even mention discounts they mentioned, the first notice of loss and the claims recognition ability. If you are talking to a customer, you’re like, look, if you put this device in your car and you let it track your drives, what it does is as soon as you’re involved in an accident, it notifies the insurance company for you and it gets the claim started.

It could save your life, because then they get involved right away. They can talk to emergency personnel for you, they can do all of this stuff. They’re selling it more as if you get into an accident, this could be the difference between you living and not. It’s a powerful message. There are some use cases, there’s a company in Poland that is taking that approach exclusively, and they’ve got a couple of very strong use cases where they can show that it made a huge difference. There are different ways to market these devices, you just have to figure out what the consumer wants.

Michael: You get three options discount, gift card or save your life.

Greg: Yes, those are three. There’s more.

Michael: There’s more, okay.

Greg: There are more.

Michael: The example that you gave, that device, is that a third party InsurTech vendor or is that coming from a carrier?

Greg: Most of them come from vendors. A couple of carriers have tried to create their own, but just about every single carrier that I know of now partners with a vendor in some form. Different vendors make different kinds of devices. The commonalities among the vendors is that almost all of them offer some type of scoring system to help your underwriting side.

Almost all of them offer some type of way to integrate rewards, almost all of them are white-label so the carrier can brand it their own right, and almost all of them now have some type of clean detection.

Michael: Maybe this leads to the $64,000 question. Now that carriers have had these devices and consumers have used them, and the purpose is to drive accuracy to underwriting, how successful are we?

Greg: First of all, in the US, you have a very low take-up rate right now, under 30% with some of the best carriers. Progressive probably has had the most success, but they’ve been in it longer.

Michael: Okay. Let’s say they got 25% or 30% of their consumers that are using it, which is more than what I thought they would have, is that having an impact on the accuracy of their underwriting?

Greg: Progressive, has not and will not tell me this, but the carriers that I have talked to, they see an almost immediate impact on their ability to rate and a lot of them will use like three months segments. Give me three months of driving data, and I can translate that into how you compare to other drivers. It feels like in the United States, we’re at the point where almost a tipping point. I don’t think we’re quite there yet. I think the marketing needs to be beefed up a little.

I think that we’re almost at the point where we’ll start to see these types of devices take off. Here’s the question in the dark corner that a lot of people don’t ask is, from a regulatory standpoint, how does this play Honestly, it’s playing pretty well. Think about it this way, how many states are really concerned about using credit to rate auto? Quite a few. Some of them are acting on it, some of them don’t even want you to use gender anymore.

A lot of the traditional rating factors are coming under fire, but it’s like, “How can you say that just because I’m male or female or just because my credit score is a certain number, that I’m going to drive better or worse? I know the law of large numbers states that I probably do. Isn’t there a better way?”

Michael: I am different.

Greg: Sure, well a telematics device actually, there’s no arguing, it is giving a rating based on how you’re driving.

Michael: Okay. I want to broaden this a little bit. Before I do, is your sense that the industry will move more in this direction with Auto Insurance?

Greg: Absolutely, I do. There’s one other factor at play here as well. It’s still years off, but there has been some Woe Is Us articles written about the insurance industry with automated vehicles. What happens when there aren’t as many accidents? What happens when cars are that much safer? Telematics provides an avenue for insurance companies to start to get their feet wet in usage based insurance. That will give them the data that will allow them to start making decisions about how to approach changes such as that. We’re years away, so there’s plenty of time, but that time can run out pretty quick.

Michael: Well, that is a big question. Potentially, that does have an enormous impact on this industry if, in fact, there are fewer accidents.

Greg: Sure.

Michael: We’re dealing with one of the big social issues; data versus privacy. It’s difficult to have a conversation about almost anything; Facebook, politics so on and so forth without having at some point to dive into this issue about, yes, I’m online, yes, I’m willing to share this, but no, I don’t want to share this or I don’t know how much is being used, and how I’m being exploited because of that data and so on and forth. I think that there’s a certain amount of social anxiety around this issue, sharing data.

Greg: Yes.

Michael: Okay. Now, that being said, it would seem that my driving data is relatively safe, but I’m willing to share how fast I drive and how quickly I hit my brakes. I’m not revealing a lot. I’m not going to be hurt because people know that. It does seem that this is an issue that people care about, regulators probably care about as well.

Now, when we start looking at other lines of insurance like health insurance, did you discover like, are people responding differently depending on the different lines of insurance?

Greg: No, actually. One of the things I want to make clear is the way we approach the survey. We didn’t come right out and just ask people, “Do you want to share your data?” That’s a great way for people to say no, I don’t. First, the approach that we took is we asked them about the devices. “Do you own these devices?” When 70% say, “Yes, we own a smartwatch,” and 68%, “Yes, I own a fitness tracker.” When you start looking at all of these different things, it’s pretty clear that all of these things, you’re generating all this data.

We wanted to make sure that part of the message that we were giving was, there’s a value to the data that you generate. If you have an insurance carrier that you’re doing business with and they’re willing to provide you with some type of benefits in exchange for that data, is that something you’d be willing to take?

To go back to the points I was making earlier, a significant number were like, “You know what, we would be willing to trade that,” and it was across all four lines, Michael. Really the one that was the lowest with home, and so for the 5% discount on the homeowner side using smart doorbells and smoke detectors, those types of things.

Michael: As long as Internet of Things is their connector.

Greg: It’s just IoT devices. That one was just under 50%. Remember how I told you the 5% that would definitely goes auto was over, that was just under, but life and health were just as high if not a little better than auto.

Michael: Very interesting. Okay, a little bit of a surprise.

Greg: There are some companies, I think John Hancock is one, I can’t remember the others but there’s one over here to Generali is offering them in Italy. They’re already marketing these types of policies where if you’ll share data from different types of health related devices, then you can earn rewards or benefits or something like that.

One thing to keep in mind is that so far, we’ve talked only about monetary rewards. My survey really went beyond that. The report on this hasn’t been published yet, so I know you haven’t seen it, but it’ll be out, my next one will be out sometime in October.

We also asked about non monetary rewards. For example, if you’re using this driving app, what if your carrier were to occasionally offer you things like, hey, you take this route to work every day, but there’s a huge accident. It would be much safer if you took this other route and your chances of having an accident are much lower.

Or if in your home, if we’re monitoring the condition of your home and smoke detectors and all, it looks like you need to update these two devices to make sure that they’re still able to protect you and your family. By the way, there’s a hurricane coming and here are some steps you can take to make sure that your home is as protected as possible.

We looked at it as a personalized advice program. We did the same thing on health and life. What if you made these changes to your life? The response to that was much stronger than we anticipated. If we take those results by themselves, those results were almost as strong as the ones with monetary value for people that are like, if that’s all I get, I’ll take it. I’ll look for a new carrier and switch just to get the benefit of those.

Michael: Did you find that people who have, own, or use connected devices are more willing to share data?

Greg: Yes, from the standpoint of the way we asked it. We did not really go down the road of if you don’t have any of these devices, would you still be willing to share because most of the people that didn’t have them were also responding that they weren’t really sure how they worked and they weren’t really sure what the functioning was.

There is a little bit of education there, but overall, I think we were over- and pulling a number out of my head – over 75 or 80%, who had at least one of the devices. For the most part, and that was across all age groups, all income, all the demographic factors too, which was surprising as well. It was a very revealing study. In fact, we’re going to expand it and go to Europe next year with it- [crosstalk]

Michael: I did want to ask a point of clarification because of where you are. You surveyed US consumers?

Greg: Correct. Just US consumers. All the information I’ve given you so far is US only, not even Canada, just US.

Michael: What do you think the implication is for the independent insurance agent?

Greg: For an independent insurance agent, I think the implication is this, don’t automatically assume that the customer sitting in front of you is going to balk at sharing data. Don’t automatically assume that the customer sitting in front of you is only interested in a discount. Understand what the devices do and what all of the benefits are.

Even the most basic devices that are out there now with insurance carriers do more than just provide reading information. It’s important to understand how they work and to be able to explain that the customers because all you have to do is hit on one of their key triggers, and you’ve got a customer buying into it. The more customers that buy-in, the better data the carrier gets and the more consistent the rates get which really helps insurance agents because the last thing you want is for rates to be all over the place and people come to you and complain about it.

Michael: Do you think as the industry moves more in this direction, this now becomes an important part of the conversation between the agency and the insured?

Greg: I do and I think it’s only going to get more.

Michael: Got it. Okay. For agents who want to understand this more, want to learn more about connected devices and the impact on insurance and they want to keep their finger on the pulse of what’s now a very rapidly changing industry, where do they need to turn? Should they turn to their own carriers?

Greg: I think that’s going to be the first place that I would look. You’re talking about state farm where I work, we had captive agents so you only have to go to one carrier, independent agents had to go multiple-

Michael: For an independent, they have to go to independent carriers.

Greg: Each one of those carriers, they’re going to be able to tell you about their product and they’re going to be able to tell you a lot about it. The other thing that you can find out very easily, who are they partnering with? It’s not that difficult. Most of the carriers, even though they’re white labeling these systems, it’ll still say state farms drive safe and save brought to you by Cambridge Mobile Telematics.

Now you know you can go to State Farm and find out about the program and then you also know who’s helping them with the tech and you can go to that company and those websites are incredibly informative. You can even just do a search on the auto side. I will just go on the internet, do a search for telematics, click on a few of the companies that come up. You’d be amazed at what you find. There is a ton of information.

Michael: What does an agent need to know about the vendor itself?

Greg: I wouldn’t really be concerned about what you know about the vendor. The vendor site is going to give you some insight into the capabilities of the devices that they build.

Michael: Okay, very good.

Greg: It’s going to give you a probably more, it’ll give you a similar overview to what your carrier is going to give you, but if you want to dig a little deeper, they’re going to be able to give you that information too, and a lot of case studies are available on the vendor’s site, and that can be huge.

Michael: That’s an important part of the conversation as well. Greg, I do have another question for you. At the beginning of this conversation, you said that essentially, what you pay attention to are the big trends that are affecting the industry, the biggest trends, I think was the word that you used.

Greg: We try.

Michael: Okay. In a general sense, what do you think is happening? What are the trends and forces that are affecting the industry in such a way that agents need to sit up and pay attention to? Which are the forces that we need to be vigilant to?

Greg: The acquisition of accurate data is huge right now and that’s impacting everybody. Honestly, the thing that I am the most passionate about and the thing that I actually touch on in just about every report that I read is the need for the insurance industry to do better with customer engagement. Our industry is notoriously horrible at customer engagement. We’re really good about contacting our customers when they have a bill due, when there’s something wrong with their policy or we need more information, or when they have an accident. That’s it.

Two of those are always not pleasant, and one is generally not pleasant either. I think that there’s a strong sense that if, as an industry, we don’t get better at the customer engagement piece, then the carriers are going to find themselves in a race to the bottom. Who can have the cheapest rate today? Some of that’s already present in the UK with price aggregators. Basically, people can, in five seconds, go on their phone, look at 20 different carriers, pick the cheapest one, get the policy and boom, I’m set for six months; and then in six months, repeat. Well, if you want to avoid that you have to try and build the relationship.

Michael: No loyalty.

Greg: Exactly. So if you want to build your brand, and we all know that it’s cheaper to keep than it is to acquire. In order to help manage that cost, I think the customer engagement piece is a massive thing.

I think that is underlying a lot of the stuff that’s going on in the industry. It’s how can we take our employee resources and better utilize them to enhance customer engagement? If that means using AI to process some of our basic underwriting tasks and let the underwriter do a better job of communicating with the agent about what has to happen, and if it means the same thing on the claim side to give the claim representative more time to converse with the customer and to make sure that they’re being taken care of. If it’s using devices like telematics to give somebody some feedback, “Hey, you’ve had three straight weeks where your overall driving record has been a B+ or better. Here’s a coupon for 10% off your next Happy Meal,” or something like that. It doesn’t have to be a two-way conversation. It just has to be engagement.

Michael: I didn’t intend to throw you a softball question, but turns out that you couldn’t have said anything that was like more delightful to me having been a founder of an InsurTech that is intended to deliver deeper, stronger relationships by making it easier to be in touch with the customer base. That wasn’t intended to be a setup.

Greg: No, that was not a setup. I didn’t know it was coming.

Michael: You didn’t know it was coming. In addition to that, it does seem the customer behavior clearly has changed and agents and the industry, in general, need to continually find ways to be in touch with them, be close to them, deliver some value and meaning and occasionally deliver some delight.

Greg: Absolutely. We have to change the narrative, and I think if we can do that, it’ll help.

Michael: I’ve always felt that the promise of the agency channel is the promise of a relationship. Unfortunately, so much of the research indicates that we don’t deliver on that. As InsurTechs and technologies emerge, I think we can use those to fulfill that promise. It’s a fundamental promise.

Greg: Agreed.

Michael: Greg, to wind up here, what’s next? What are you looking at next because you’re always looking at the future and where things are going. So what’s got your attention?

Greg: Sure. Well, the next couple of reports that I have coming up are, I have a personal lines telematics report that will be out soon. That’s really just taking a hard look at how telematics can impact personal lines auto, and it’s going to be a little deeper dive than I normally go.

Then like I said, the auto advice report will be out shortly after that. Then I’m tackling an IoT report. It’s interesting that you can see all kinds of information about all the different devices available to help people drive better, but there’s some murkiness around what can I use in my house to maybe reduce my homeowner rate? I’m going to explore that a little bit.

Then starting next year, our roadmap goes all over the place. I’ll have another AI report, probably looking at artificial intelligence and its use in the claims environment. I’ll have to revisit blockchain next year. I did a blockchain report earlier this year at a very high level. Basically, the results of that are pay attention but you don’t do anything yet. We’ll see where they are next year.

That’s it. We’re staying pretty high level. We cover both underwriting and claims and generally, we are globally focused, but we will focus on a particular geographic area if it is warranted.

Michael: If you had an opportunity to deliver a message to the agent community in this fast-changing world, given the trends and forces that are making change that are outside of our control, if you had a chance to deliver a message that they should pay attention to and think about executing on, what would you say?

Greg: Some might take this wrong, but I would say make yourself invaluable. You have the very first opportunity to connect with a customer regardless of the carrier that you represent. Make yourself invaluable, both to the customer and to the carrier and then the future will be written for you. If you don’t, then technology will take over eventually.

Michael: Got it, all right.

Greg: The same is true with carriers, but particularly for agents, I think.

Michael: Got it, okay. Are you optimistic about the role of the agent in the future?

Greg: I am. I think that there will always be a role for agents. Insurance is inherently complicated in many areas. I do think that some policy groups may become less agent-oriented.

Michael: Indeed

Greg: Personal lines auto is kind of a low hanging fruit. Basic renters is a low hanging fruit. There will always be a need for agents to get into more complicated stuff.

Michael: Right.

Greg: With all of the data that’s available, I can certainly see a movement from the law of large numbers to the insurance of one where I have enough data so that I am a unique individual, and there is enough data with different pieces of my personality that they can generate a rate for me. I think when that day comes, and as we move to that, that’s when the agent will become invaluable, because that’s when you’re going to be able to really sit down with the customer and say, “Well, it looks like you turn too fast or it looks like you really break hard a lot. Here are some resources to maybe help you drive better. Here are some resources to help you protect your home better or live a healthier lifestyle,” whatever it is. I think the agent can play a role in that, and I think that’s when it’s going to become really important, that you have to be able to really connect with the consumer for that to be impactful.

Michael: Okay. Greg, this has been a delight. I appreciate this, and I appreciate the insights on all of your research.

Greg:Thank you so much. I appreciate being on, and I hope that it’s of some value to your listeners.

Michael: Oh, indeed. Absolutely, no question. We delivered pure value, you did. More meat than a Texas steakhouse. On behalf of the audience, I want to thank you very much for joining us today from Dusseldorf, Germany.

Greg: Thank you very much. It’s a pleasure.


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