Immigrants vs. natives

May 23, 2008

Of the many meetings I had at this year’s ACORD conference last week in Las Vegas, one theme that came through in many of them was the impact a new generation of employees and consumers will have on the insurance industry from a technology perspective.

Mark W. Lewis, general manager, global insurance industry at IBM, described the issue as one of digital immigrants vs. digital natives. As a Baby Boomer who’s come to embrace information technology in my professional and personal lives, I fit into the immigrant category. Folks like my daughter and others just getting started on their adult lives and careers–who’ve grown up with personal computers and can text message like the wind–are the digital natives.

“In a few more years you’re going to have far more people who don’t even think about technology,” Mr. Lewis said. For the digital natives, IT is just a fact of life, not something that catches their attention.

“The most important part about that is you truly think differently,” he said. “The fact is the business world is being changed and it will continue to be changed by people like that.”

That everyday familiarity with technology will manifest itself in many of the decisions made by the next generation of business executives, Mr. Lewis said.

“One of the advantages that the digital natives will have is the more the business executive knows about technology, the better decisions he’ll make about what is possible,” he said.

The subject was at the heart of a meeting with Bill Hartnett, U.S. insurance industry solutions director at Microsoft Corp., as well. He and others from Microsoft were noting the impact the next generation’s expectations and experiences will have on the insurance industry, and promoting solutions to help address them.

A survey the company conducted earlier this year of adult “Millennials”–those 18 to 27 years old–show the issue cuts both in terms of the industry’s meeting its talent needs and in serving the next generation of insurance buyers.

The survey showed 91% of those questioned saying access to newer, innovative technologies would make them more likely to consider potential job opportunities.

Survey respondents also indicated they see the industry’s adoption of various technology-based customer service tools is an important issue, with 89% saying they think it’s important insurance companies provide Web-based customer support, 86% saying it’s important that insurance companies offer customers personal Web portals on which they can view their accounts and 76% saying it’s important they offer live online chats with agents.

They also are believers in blogs, according to the Microsoft survey, with 69% saying it’s important to them that insurance companies offer company blogs on which customers can post their questions or concerns. 




Tiny technology, sizable issues

May 1, 2008

From my perspective as a journalist, one of the really cool things about attending RIMS is the opportunity to have conversations with a lot of folks engaged in some really interesting issues in risk management and commercial insurance.

One such conversation I enjoyed this week was with Connie Germano, senior vp excess casualty at ACE USA in New York. The subject was nanotechnology, and her perspective on what constitute some of the key issues surrounding nanotechnology was an interesting one.

Given the work that’s going on to tap nanotechnology for everything from consumer products to medicine and the questions that remain unanswered about the potential risks associated with these molecular machines, many have questioned the possible risk exposures associated with nanotechnology, and, with those risks, the possible impact on the insurance business.

It’s not uncommon to hear someone saying nanotechnology could be “the next asbestos.”

But that sort of attitude is in fact one of the key issues that needs to be addressed if we’re to reap the benefits of nanotechnology, Ms. Germano said. While several major insurance and reinsurance companies have begun researching issues associated with nanotechnology, there are as yet no nano-specific coverages on the market, she said.

And, for some underwriters, the findings of that research might lead to “the fear stage” about nanotechnology, she said. “And they might try to exclude it as a result, which is exactly what we’re trying to avoid.”

Noting that of the $12 billion spent on nanotechnology research in the U.S. in 2005 $10 billion was spent on using nanotechnology and only $2 billion on the risks, Ms. Germano suggests that it’s critical that more research be done to identify the risks associated with nanotechnology, and then steps taken to develop appropriate standards for everything from the handling to the disposal of nano materials.

From an insurance and risk management perspective, the key to reaping the full business and societal benefits of nanotechnology is understanding any risks and managing them effectively, Ms. Germano said, adding that she doesn’t want to see the insurance industry respond to possible nanotechnology risks with “a knee-jerk reaction and just exclude it.”

“From an insurance perspective, my responsibility is to understand what’s going on in my clients’ world,” she said. “And as an insurer, my responsibility is to make sure they understand it and are addressing it to the best of their ability.”