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Life Health > Health Insurance > Your Practice

Kill the policy: 10 cans of inspiration for insurance innovation

By Maria Ferrante-Schepis

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If you step outside on a quiet night, clear your mind, and cup your ear with your hand you may be able to hear the faint sounds of leaders in the insurance industry saying, “I’m mad as hell and I am not going to take it anymore!”

Well, maybe not exactly those words, and maybe you won’t actually hear it, but suffice it to say that the tides of insurance innovation being considered an oxymoron are changing.

How do we know this? Because we see evidence of leaders in and around insurance letting go of certain paradigms, and making an effort to think differently. How are they doing that? By killing something.

Of course I mean figuratively. Violence never solves anything, in my opinion. In this case, what’s being killed is one or both of the following:

  1. The notion that the insurance industry is in the business of selling policies;
  2. The notion that the insurance industry is bound by policy (i.e. rules, regulations or internal practices that feel like rules and regulations).

The best innovation leaders are challenging one or both of the above in envisioning the future of their business.

There are varying degrees and approaches to “killing the policy” happening right now. Some of these companies are doing it to keep a current product or service alive and viable. Some are doing it to differentiate themselves dramatically from competitors. Some are doing it because they want to learn something valuable that can be useful in the future. Others are doing it to completely reinvent a category.

What can we learn from a few examples? See if you know which companies the following are referring to. (Answers are below.)

Companies that killed (or are killing) policy #1:

  1. A health insurance company that has launched a service for caregivers, or those who assist the elderly in their homes or who have other special needs. No insurance policy is necessary;
  2. A dental insurance plan that defines its business as overall well being;
  3. A UK insurer in the long-term care business that doesn’t sell long-term care policies;
  4. A pet insurance company that provides financing options and related services to people who cannot afford to pay for costly operations for their pet; and
  5. A crowdsourcing platform that fills health care financing needs after the fact, for profit, and without any insurance regulation involved.

Here are some that killed (or are killing) policy #2

  1. A dominant long-term care insurance player that is working with regulators to change the rules that have forced most of the industry to exit the business;
  2. A startup company that has invented a shopping cart technology for insurance products that defy underwriting gravity, creating an “insurance aisle” that can be plugged into any financial institution;
  3. A new health insurance company that has made going to the doctor a pleasant experience by eliminating common practices that stand in the way;
  4. A dominant life insurance player has taken life insurance into the packaged good space, debunking the “sold not bought” paradigm; and
  5. A startup company that has made DNA testing available to the masses, and despite an FDA crackdown, is now in a position to invent new rules to govern it.

The leaders behind these inspirations all have some important things in common, in good times and in bad. They don’t compromise at the expense of consumer or customer needs. They don’t accept “givens.” They have the stomach for the hard stuff. And, they know both why they are in business as well as what business they are really in.

Do you have the willingness to kill something for the sake of what’s next? If so, what would it be? Do you want to open your own can of inspiration? If so, please do tell!

Do you want to know more about what these companies and leaders are doing? Go to http://maddockdouglas.com/live-webinar-apr-17-kill-policy-new-inspiration-insurance-innovation.

(Answers in order of appearance: Highmark, Delta Dental, Partnership, VPI (Veterinary Pet Insurance), GiveForward, Genworth, Insuritas, Oscar, MetLife, 23andMe.)

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