CRM Acceleration London, September 2012, Presentation Sugar in your verticals - Insurance Industry

1. SugarCRM in Your Vertical
Insurance
Andrey Andreev
Global Technical Programs Manager

2. Vertical Solutions – The Learning
Process
• Understand the industry structure and
vocabulary
• Understand the industry dynamics
• Understand the industry challenges
• Understand the industry processes
• Conceptualize and communicate the solution

3. Our Case – The Insurance Vertical
• What is an insurance company?
• How does it work?
• What is going on in the marketplace?
• What are the key challenges on the way of
success?
• How do we remove them with Sugar?

4. What is an insurance company?
• A financial services provider, that aggregates
similar but separate risks across a large
number of individuals, and distributes the risk
exposure using sophisticated mathematics
• Charges premiums to collect the exposure
share plus a margin
• Invests the money collected
• Indemnifies for claimed damages covered by a
policy

5. How does it work?
• Develop products
– Life
– Car
– Property and Casualty
– Liability
– Health
– Disability
– …
• Price them exactly
• Distribute
• Process claims & complaints

6. How does it work – Products &
Distribution

7. Products
• Siloed – carriers may be separated by law
• Complex – seriously complex
• Isolated – different processes, customers
and channels

8. Distribution Channels
• Sales channels
– Direct (e.g. online, over-the-phone)
– Captive agents (also called tied, exclusive, etc.)
– Independent agents/brokers
– Affinity-based (e.g. car dealerships, bancassurance)
• Other players
– Insurance pools/syndicates
– Comparison portals
• Common agency specifics – information hiding,
regulation

9. The Insurance Dynamic (roadblocks
included)
• Push for growth in a stagnant market
– Even shrinking markets
• Commoditized product, pressure on margins
– Save 15% or more by switching to…
• Active, demanding, empowered customers
– Talking to some of the most conservative companies
out there
• Lack of customer trust, loyalty
– Average person has 5.2 policies, avg. carrier holds
less than two of those

10. Tackling those roadblocks
• Find new markets?
– Hard, but possible
• Decommoditize products? Price them better?
– Not really possible
• Better engage active (existing) customers?
– Good idea, sounds sensible enough!
• Treat customers with more transparency, service
them better?
– Why not?
• So, then, it is the customer we need to focus
on

11. How might that work for X?

12. The strategic dilemma
• According to a study by the IBM Institute for Business
Value, 90% of all insurance CEOs picked getting closer
to the customer as their most important strategic initiative
in the next five years.
• However:
– Insurances might never even talk directly to a
customer
– When it happens, information is fragmented, due to
the multi-channel, multi-equipment communication
– Agency complexity
– Information systems and processes revolve around
products, rather than customers

13. CRM is the solution! Some complications
• Agencies more often than not independent
– Info does not usually flow upstream
– Competitors working in the same system
– It’s not just attitude, it’s the law
• The data lives in ancient mission critical systems
– And you cannot touch it
• Complex “customer” relationship
– Insurance owner, insured person, indemnitee
• People don’t really talk to insurances that often
– At least not when they are in a good mood

14. MOTs? What MOTs?

15. Let’s see the demo
• Germany based
• Founded 1820
• Active in every insurance class
• 3.5 million customers
• Revenue $5.2 billion
• System running out of IBM SCE in
Ehningen