D.j. Wischmeyer is the Director of Technical Partnerships at Ivans Insurance Solutions, where insurance carriers, agents and MGAs come together to grow their businesses. D.j. was interviewed by Michael Fiedel, a Managing Director at InsurTech Ohio and Co-Founder at PolicyFly, Inc.
D.j., what has held the insurance industry back from adapting to new technology in the last 20 years?
“I see three main factors here. The first is that the insurance industry is naturally risk averse. That makes the traditional culture very resistant or slow to change. The cautious approach of being risk averse required a significant cultural shift to move away from the processes in place and embrace a more digital ecosystem. The second point is many insurance carriers were and still are heavily reliant on outdated legacy systems and processes. Replacing or upgrading these systems is very costly and complex, which makes it difficult to migrate to new technologies. Finally, the industry has historically attracted professionals with a strong expertise in insurance or finance rather than technology. Having that skillset makes it challenging to evaluate and implement new technologies.”
How have you seen the focus on attitude and adoption around technology change during your career?
“The cultural shift mentioned above is happening. Insurtechs, like Ivans and others out there, have elevated the speed of onboarding new technologies. Insurers are beginning to see the value of these technologies to foster one-on-one connections with their insureds. Organizations are seeing being digital as part of their overall business strategy rather than a side function. They have increasingly adopted technologies to accelerate innovation, streamline operations and improve efficiency to better serve their customer base. The industry is beginning to heavily invest in technical resources and education, they're building out teams dedicated specifically to technology. That's led to insurtech startups and insurers creating internal incubator labs to create or acquire new technology.”
What are some of the distinct technologies or digital capabilities that you believe are game changers for insurance?
“Cloud technology has been one of the biggest advancements that I've seen. It enables insurers to store and access data more efficiently, scale instantly and enhance collaboration. The technology has been around for a long time, but we're just now seeing widespread adoption in insurance. You've got insurers integrating with cloud-based systems like Guidewire or Duck Creek that enable products like instant download to their agents.
The use of data analytics and big data is providing insights into customer's appetites and behavior. It’s helping the insurers tailor products and services to the specific needs of the customers improving the experience as well as predicting and mitigating risk. Finally, we can't talk about tech without mentioning AI or ML at a high level. It has the ability to be a disruptor in the industry with proper guidance and regulation as the technology matures. The data analyzed is going to increase the accuracy and allow for automation of data-driven decisions and processes. It's currently being applied in areas like underwriting, claims processing, risk assessment and fraud detection."
What do you hope the insurance industry will accomplish in the next 10 years with further support behind innovation?
“My hope is that the industry continues to lose its stigma of being a technology laggard, and it uses the technology advancements to benefit insurers, agents and policy holders to be a more efficient and responsive insurance ecosystem. I hope that all of the insurers begin to see the digital enablement and include it as part of their business strategy. There are still a lot of insurers out there that are not fully on board with digital transformation.
As a natural progression, I see the digital round-trip of insurance being augmented with the internet of things and AI, and that'll lead to more simplified processes and improved experience across the insurance ecosystem.”
When you're hearing from clients about their strategy and intention, what are some of the things they say that gets you really excited about what they're trying to achieve? What does that conversation look like when it's going really well?
"When you're integrating and adapting with all of the new technology that's out there, it's awesome to hear the ideas people have to get things done more quickly. Historically when you think insurance, you think batch-driven and a very slow overnight process. We have insurers reaching out going through a platform and infrastructure modernization. They bring us in to augment that investment, to fully modernize the round trip of their transactions.
I get excited when our integrations with these vendor systems are fully implemented and the insurer has the ability to process transactions instantly. We end up with an instant round trip of a transaction getting that data from the insurer to the insured and back in a split-second. Ultimately this provides a better quality of service for the policyholder and reduces the back and forth communication throughout the process due to delay in delivery.
I was at a conference recently sitting in a carrier session and they are talking through our implementation to their agents. Seeing the excitement from that carrier representative and the reactions of the agents in the room was phenomenal! That's the stuff that keeps me inspired about this journey."
What concerns you about the attitude of a particular prospect or client when they're looking to get your perspective on evaluating their strategy from a technical and innovative point of view?
"I had a conversation with the CTO of an insurer recently about instant download and delivery to their agents. They're migrating to one of the new cloud systems but wanted to keep the batch overnight processing in place. His reasoning for not wanting a more frequent download cadence was that his agents are not asking for this. He didn't have the right mindset on future-proofing the system that they're investing heavily in. This is the type of conversation that keeps me up at night and makes me realize that all of this is a process. There is still quite a bit of work to do, the industry is more accepting and adapting technology at an accelerated pace. As legacy systems are being retired, the path forward is looking very bright."