Recently at a meeting, a customer good-naturedly elbowed me in the ribs and inquired conspiratorially if I believed that Artificial Intelligence would one day replace brokers. My immediate response was an emphatic, “No!”
I remember when I first began in the industry back in the mid-‘90s. I thought specifically about how when I assumed the role of an Account Manager for a broker’s office, I encountered innumerable clients who had a single plan option. I was delighted to be able to provide them with a new world of choice: dual-option. My clients benefited from the ability to select one HMO and one PPO from the carrier of their choosing. Back then, everything was more straightforward. Services were copays ($) or co-insurance (%), clearly defined and without the messy tiers or caps that exist today. There wasn’t a page of footnotes to consider. Prescriptions were Generic and Brand. I didn’t need to have lengthy conversations with customers assessing all of their health care needs like we do today. I didn’t have to inquire about those suffering chronic diseases like Diabetes; of course, these things were less common then than they are now. While I still had to perform a Provider Network Analysis, and for larger employers seek a disruption report from GeoAccess, there was a single HMO and a single PPO network per carrier. And I recall the provider directories being more accurate, so much as a printed (yes, they published these in large books) could be.
I could have developed an artificially intelligent software solution to face that world. It would take time, but with that degree of limited variability, it would be entirely possible to define at least an initial scope that captured a significant portion of the market’s typical issues, starting with price.
When I first began at Word & Brown as a Regional Sales Manager, I performed Client Presentations. I became experienced at problem-solving a client’s or prospect’s issue and identifying the best route to resolution by way of replacement or augmented insurance products depending on the need. In my last year in the role, I performed some 120 presentations. What shocked me was that no two were alike. While aspects were similar, nearly everyone griped about price; there were variables that only presented themselves when we arrived at enrollments or even within Underwriting that I had not foreseen and about which no one had thought to make me aware. I learned to ask all the right questions, I learned to gain the insights I needed to make a proper and thorough analysis of the current, renewal, and comparable marketplace alternatives. And I realized the maze of insurance had become an infinitely variable path depending on more factors than I had imagined possible. That was pre-Affordable Care Act (ACA).
Fast forward to today, where we face carriers with multiple HMO and PPO networks, online provider directories that despite SB 137 still contain deceased, suspended, and fabricated physicians, hospitals in every tier of coverage, limits on everything from office visits to Durable Medical, variability on where and how a deductible is applied or determined, carrier differentiation on rating a policy and rating a new-hire, up to twelve tiers of prescriptions (in Nevada), prescription formularies, substantial differences in how one derives access to care on similar plans between carriers (as is the case for Diabetes, which can be covered by Durable Medical and/or Prescription coverages), variability of employer and employee-location rating between Medical and Ancillary product lines, carrier-wraps where contributions slice the pie across plan types and carrier products, packages with in excess of 30 plans or more, and a retail customer populace that has little time – or interest – in reading the details of their coverage or how they will access it, until they have a significant life event requiring that they do so.
The complexity of our market today is astounding.
All of this, and more, have made the prospects of devising algorithms that would have to be as complex and ever-evolving as Google’s search, a daunting task to say the least.
(Slight aside: I do feel fortunate to have made the journey with the evolution of this marketplace from its early simplicity, because I have watched these changes present themselves in carrier updates over the years. Like most software, what began simply grew in complexity as features were added to combat rising rates by curtailing frivolous spending or forcing a change in behavior. And like software, version 1.0 was easy to understand whereas version X is a dream for those who understand it and a nightmare for those who do not. I can only imagine the ramp-up time for those who are just joining our ranks in the honorable duty of brokering insurance and how they face the perils of the many pitfalls today’s market contains as they try to compete and grow their brokerages. I think of them, and I am grateful for General Agencies, not just because I work at one, but for what we offer: a trusted resource that guides the narrative of insurance purchase and policy maintenance with extreme care and expertise. I wish some of the software I use today offered a General Agency’s service!)
I was once made privy to a sizable technology firms’ tools for helping customers select the right renewal plans. I was excited at the prospect of seeing what they had developed, because they certainly had the capacity to do great things. I was dumbfounded when I saw a current plan selected and set aside plans of every degree of variability, some not even the same plan type. It was the result of a technical approach to something that I believe requires the intellect and holistic vision that only a human can offer. And, at that, a human with a deep understanding of our marketplace and technology and how the two might intersect meaningfully.
While it may be possible in some 30 years’ time to develop code to support avoidance of some of these potential pitfalls, the amount of programming necessary will require years of effort and many millions of dollars in investment.
In the interim, I do believe we can leverage the vast wealth of data at our disposal to surface the above facts of insurance, to highlight the complexities meaningfully and in their proper context, to serve our brokers to support their customers with solutions that meet their needs with software that will satisfy them. This is what we do every day at Word & Brown; we empower our brokers.
To that end, we’ll be releasing some tools this year designed with this in mind. Certainly not to replace the broker, but to offer technology that creates the best consultative experience a customer can have: one that is supported by, not replacing of, a joint effort of where humans and technology come together for the most excellent net effect.
