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The Mobile Data Challenge: Insurers Must Refine Content and Data Strategies as Mobile Becomes Consumers' Channel of Choice

As consumers increasingly expect to be able to manage their financial lives via the mobile channel, insurers must develop explicit strategies to extend a full range of content and data management processes to mobile devices.

Safety Insurance ($649 million in direct written premium), as its company autobiography asserts, was founded in 1979 with a belief that it would succeed as an organization if agents and customers were given the best possible service. That philosophy motivated the Boston-based regional P&C carrier to launch its first iPhone app for consumers in spring 2011. "Like our web strategy, our mobile strategy is all about service," says Steve Varga, senior IT director, who oversees Safety Insurance's mobile initiatives.

The carrier's iPhone app, called Safety Mobile, which was created with the help of long-time vendor partner Agencyport over a five-month period, includes first-notice-of-loss (FNOL) for auto capabilities. According to Varga, the app lets policyholders report their location and the time of an accident, and provides a screen to let them indicate the point of impact on the vehicle. Users also have the option to upload photos, and they can pull up a copy of their insurance cards.

"In the event of a claim, the FNOL app collects the policyholder's phone and email addresses, and the app also provides maps and directions to our various claim offices," Varga explains. "We also offer an agent finder so that potential insureds can download our app and find an agent in their hometowns. It provides links and maps to the agent's website, along with contact information."

The Future of Insurance Transactions

For now, only about 5 percent of the carrier's regular online users have downloaded the mobile app, but Varga says he is content with the adoption so far. For one thing, he anticipates a surge in usage now that Safety has rolled out bill payment capabilities within the app, once again with Boston-based Agencyport's help. Perhaps more important, Varga has no doubt that mobile service capabilities are one of the keys to future success. "The teenagers whom we watch conducting their lives on their mobile apps are the drivers of the future," he observes.

Research from Forrester substantiates Varga's expectations about American consumers, according to Ellen Carney, a senior analyst with the Cambridge, Mass.-based analyst firm. An average of just under 15 percent of all respondents to a recent Forrester survey said they were interested in using their mobile phones as the main channel for personal finance; but among 25- to 34-year-olds, the figure was in the mid-20s, she reports, and more than 25 percent of respondents 18 to 24 years of age answered in the affirmative. Responses for insurance use specifically were a little lower, except in the 25-to-34-year-old group, Carney notes.

"The mobile trend is the most disruptive thing to happen to insurance since e-commerce," Carney adds. "Maybe even more so."

Since the beginning of the decade, the most advanced web-enabled phones could read news and search Google but do little else, comments Chad Hersh, a partner with research and advisory firm Novarica (New York). "Today I literally tell my phone what I want and it retrieves it at speeds that put my home and office Internet connections to shame."

With apps now available to support crucial business functions -- such as e-signatures in PDF format, smart forms and even access to core systems — it's all but inevitable that mobile devices will erode the role of the laptop and desktop for consumers and agents dealing with carriers, Hersh asserts. "These devices go beyond being futuristic or even fads," he insists. "Even regulators are recognizing that fact, with several states having approved or close to approving the use of electronic ID cards."

Developments in the near future could include inexpensive telematics leveraging a smartphone's Bluetooth wireless capability, or agents using their phones as Wi-Fi hotspots for existing laptops, Hersh suggests. "Mobile devices may not only be the preferred channel of the future; they may be the dominant channel," he speculates.

Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio

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