Part of creating winning experiences in small commercial insurance is creating great service. And many carriers are proud of the service that they offer and the service level agreements (SLA) they live up to:

  • We acknowledge 98 percent of quotes and endorsement requests in five minutes;
  • We respond to 95 percent of quote requests in 24 hours;
  • We respond to endorsements in 48 hours 98 percent of the time.

But let’s unpack these numbers a little bit and look at the actual experiences that are occurring. Imagine that you ordered a pizza online. You are immediately sent an email acknowledging that the pizza company has received your request and will be back to you in 30 minutes. This is what most carriers mean when they say they acknowledge the quote or endorsement in just five minutes. They are getting back to the customer quickly to let them know their request was received. This is a good thing, but what expectation is being set by that receipt? What would you expect from the pizza company in 30 minutes?

Now, let’s look at what happens next. Imagine if, in 29 minutes, the pizza company called you up and said, “Hello, thank you for submitting your order. We have reviewed your order and see that you forgot to tell us whether you want that cut into eight or 12 slices. So I’m calling to get that information, and we will get the pizza out within 30 minutes of receiving it.” What would your reaction be? And yet, back at the pizza company the employee is being congratulated for delivering service one minute under the 30 minutes SLA. You would think the process is crazy; yet this is how we measure and evaluate ourselves in insurance every day.

In 24 hours we review the quote and check to see if we are missing information. If so, we send a note out to the agent and don’t restart the clock till all the information is received.

In endorsements, we do exactly the same thing.

We are measuring arbitrary service levels that don’t meet agents’ or customers’ needs or expectations. So why is this occurring? Well, it starts with the term “service level agreement.” An SLA is meant to be an agreement between a supplier and a buyer of services. Both get to define the SLA and to agree to its objective. But that is not the case here. Neither your customers nor your agents are part of these agreements. We need to rethink what SLA means:

Solution, not Service: When an agent or customer makes a request, they aren’t asking for service. They want a solution. That could be a quote, an endorsement, a bill resolution or an answer to a question. They are seeking a solution to a specific item. We should be measuring these outcomes, rather than whether some service was provided.

Level: In an SLA, “level” is the measurement target that is agreed by the two parties. We need this same target when rethinking delivering customer solutions. But this won’t be the result of an agreement between us and the agents/customers, nor will it be a level that we can set ourselves. Would you go to a pizza place that set itself the target to deliver your pizza in three hours? Of course not. The target is set by the market and the customer’s expectations, not our own goals or desires.

Achievement, not Agreement: Since there is no agreement, instead we want to measure the achievement of the solution for the customer or agent. So instead of measuring “service level agreements,” we now want to measure “solution level achievements.” In other words, how quickly and effectively do we deliver customer solutions?

This may seem like a simple nomenclature change, but in fact it radically changes how you approach the customer experience, the order in which you do things, and how you might deploy data and intelligent solutions to your processes.

Consider the pizza place. If they changed their SLA to be pizza delivered in 30 minutes, how would their process need to change? To have time to make, bake, and deliver the pizza they would need to know in the first five minutes if the order was complete, and to resolve that issue immediately rather than waiting until minute 29.

The same is true with carriers. We need to consider the expectations we are setting with customers, radically rethink our processes, and ensure we are delivering solutions that meet those expectations at the speed customers demand. To do this there are five questions to consider:

  • What are the solutions that we need to deliver?
  • How does the customer or agent want to submit its requests and interact with us up front?
  • How can we ensure that we have information right the first time?
  • What can we do when we don’t have perfect information?
  • How do we use all of the possible tools, resources, analytics, third party data, robotics, and artificial intelligence to meet agents’ and customers’ needs?

These are some of the problems we have been helping leading carriers to consider as they move from “service level agreements” to “solution level achievements” for their customers. Isn’t it time you started to provide better solutions for yours?

Feel free to contact me with your comments, questions and feedback.

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