3Qs with Sharon Ludlow, Veteran Insurance Executive, Innovator, and Breathe Life Board Member

Q: What are the life insurance industry’s primary challenges and opportunities today?

My view is the life insurance industry is now in a ‘perfect storm.’ This perfect storm is comprised of three things. First, the life insurance industry has experienced a major surge in consumer demand driven by COVID-19, a growth in demand which is not dissipating. Second, carriers now have a demonstrated appetite to respond to this consumer demand, a sense of urgency that they have not had before. And third, the technology is now available – witness the exponential growth of InsurTechs – to help life insurers meet this demand.

The flip side of having all of this choice in InsurTech offerings is the pressure to make the right decision. Which vendors and solutions will be right for your business? Deciding can be difficult, and insurers can be very risk averse. For them, it’s a bit like the old VHS vs. Beta crossroads – no one wants to go down the wrong path.

My takeaway here, though, is this all amounts to an amazing opportunity for insurance carriers and technology providers alike, an opportunity to take the life insurance industry to a completely different level. The demand is there as is the need, so let’s make it happen!

Q: You have had a very successful career in insurance and insurance technology, including years in the C-Suite as President and CEO of Swiss Re Canada and President of Aviva Canada. What did you see in Breathe Life that made you want to join its Board?

Breathe Life has a lot going for it, including a great leadership team and an excellent platform that is well matched to meeting a major need of life insurers and their customers – a faster, more customer-friendly distribution process. 

But first and foremost, Breathe Life has a purpose. The company’s stated intent is to make life insurance, and the financial security it affords, accessible to everyone. Everything Breathe Life delivers with its platform is dedicated to ensuring everyone who has a want or need for life insurance can get it. 

That’s very powerful. It’s a differentiator that got my attention and that energizes and informs all of Breathe Life’s work.

Q: You mentioned distribution as a major pain point for life insurers today. Can you explore that a bit?

Distribution covers a wide berth in a life insurer’s operations, but essentially distribution is about customer acquisition, policy delivery, and ongoing customer satisfaction. This is an end-to-end process that lends itself well to a platform solution, which positions Breathe Life very well in this space.

Life insurers are experiencing a number of pain points in their distribution processes. Here are a few of the most important. 

1. Customer Acquisition – The customer acquisition process, i.e., finding and selling to new customers, remains one of the industry’s biggest challenges. The process has evolved beyond the old-style ‘conversation at the kitchen table’ to a hybrid that involves much more digital interaction. That’s a good thing.

But finding those customers, particularly when they’re at a moment of need, is the tricky part and where a digital solution like Breathe Life really comes into play. In the old days, an agent would find you in a phone book or happen to chat with you at your kid’s Little League game and perhaps find an opportunity. It was arguably more happenstance than truly targeted marketing.

And that brings us back to the old adage that “life insurance is ‘sold,’ not ‘bought.’” Consumers have to buy car insurance in order to drive a car. They do not have to buy life insurance to live their lives. 

The trick is finding consumers at their moment of need – marriage, a new house, a new baby are typical milestone events where the logic and urgency of buying life insurance is made manifest – and that’s something Breathe Life and other InsurTechs can deal with so capably by virtue of being digitally connected – to consumer behavior, search results, social networks, etc. – and data savvy. Plus we have the dynamic I have already outlined of COVID acting as a wake-up call to consumers….

My point here is that modern, digital-native platforms like Breathe Life help life insurance carriers find potential customers where they’re at and turn them into real leads – and real buyers.

2. Speed – Speed continues to be a pain point in the life insurance industry at large and within individual insurer’s distribution cycles. Speeding the customer acquisition process by making it simpler and more efficient is a huge win for carriers and consumers alike. 

Eliminating paperwork is another way to accelerate turning prospects into policy holders. Acting digitally is in the DNA of Breathe Life and its peers, and it is helping a lot. Enabling prospects to answer questions online, and using automation and AI to serve up additional questions based on their responses, is just one example of how technology can quicken the process. As an added benefit, digitization is driving accuracy, saving everyone time and money in what had been a historically paper-intensive and error-ridden process.

3. Product Updates and Introductions

Remember the days when adding a new feature to a term-life product caused system-wide slowdowns as manual updates were instated? Remember how hard it was to make sure your producers and other customer-facing agents were armed with this new policy information? 

With platforms like Breathe Life, a policy update or the launch of a new product is input once in the platform and immediately available throughout the organization. It’s ‘one touch.’ This is a night and day difference in the distribution process that helps life insurers focus their resources on selling vs. IT administration and change management. 

The last thing I’ll say for now about distribution, and it applies to all of the examples we’ve just discussed, is that customers expect so much more now from their providers, regardless of industry. Amazon has set a high bar – “make it easy for me to buy, and get it to me quickly!” Anything that removes friction in a life insurer’s distribution process is going to translate into happier customers.

Q: What are the key capabilities an InsurTech must provide to win the hearts, minds, and contracts of life insurance carriers?

As a former CEO of large insurers, I think it comes down to three things.

The first is user experience, whether that user is the end customer, a producer/broker/agent, or other intermediary. That user experience provided by the technology had better be excellent throughout their journey.

Number two is speed. We talked about speeding up the distribution process, but the need for speed is paramount across the organization and all its business processes, right down to speed-to-implement. As an industry, life insurance needs to ‘get the lead out.’ This new generation of technology is going to be a big part of the solution.

Number three is cost reduction, which should be an output of improving the user experience and speeding processes. Good and great technology should deliver better experiences, happier customers, and less costly processes. 

And the good news about driving out cost is that it benefits both insurers and consumers.