the power of cognitive commerce for insurance

The power of

Cognitive Commerce

for InsuranceApril, 2016

Rising customer

expectations

Economic

headwinds

Sophisticated

fraud

Changing

demographics

Rapid

digitization

Disruptive forces are changing the landscape of Insurance

© 2016 IBM2

In insurance, your digital intelligence is your competitive advantage

Data that’s

coming

Data outside

your firewall

Data insurers

possess ++

Unstructured and darkStructured and active

Customer records

Transactional systems

Predictive models

Institutional expertise

Operational systems

News

Events

Geospatial

Weather

Social media

Internet of Things

Sensory data

Images

Video

© 2016 IBM3

Only cognitive unlocks the potential in all of your data

Think of all that has been

accomplished using only

a fraction of the available

data

Unlock the

possibilities. What answers lie

in the 88% that

is dark?1By the year 2020, about

1.7 MB of new information

will be created every

second, for every human

being on the planet.2

SOURCES cited in notes

© 2016 IBM4

So insurers can make better decisions …

Sales & Customer Service with

insights about performance

When insights come together, so do

opportunities.

Marketers to

understand and

adapt instantly

Operations & IT

with thinking built into

the ecosystem

© 2016 IBM5

When digital intelligence

meets digital business:

The Cognitive Era…A new era in technology, a new era in insurance

© 2016 IBM6

Cognitive computing will helpinsurers improve their abilitiesto engage, discover, and decide

95%Of insurance

executives intend

to invest in

cognitive

capabilities

Cognitive ComputingInsurance Industry

© 2016 IBM7

Cognitive computing is transforming how insurance is done

Direct-to-consumer cognitive

virtual agents that serve, guide,

and advise on web or mobile

• Conversational style of

interaction using text & speech

• Create an individualized

experience to make personalized

recommendations

• Invoke transactions specific to

the appropriate business process

Advisor-facing applications that provide

agents & advisors with guidance for

customers

• Front-office applications allowing

advisors to readily find pertinent

information for customer interaction

• Integration with backend systems to

provide “total view of customer”

• Analytically-driven recommendations to

improve customer interactions

Employee-facing applications that aid

knowledge workers in execution of

business process

• Leverage experience & best practices

for improved decision-making

• Access disparate systems to provide

holistic view of the risk

• Shift time spent finding information to

making decisions &

recommendations

TRANSFORMED

ENGAGEMENTEMPOWERED

ADVISORSOPTIMIZED

OPERATIONS

EXPLORATIONENGAGEMENT DECISIONEXPLORATIONENGAGEMENT DECISIONEXPLORATIONPOLICYDISCOVERY

© 2016 IBM8

For Operations

Improved Processes

For Customer Service

Customer Engagement

Insights

For Marketers

Analyze Trends

Real-time Personalization

Embracing the power of Cognitive Engagement in Insurance

© 2016 IBM9

For marketers

Analyze trends To gain insights in real-time

about what policyholders are

talking about, as well as what

they are buying and why

from a multitude of data

sources

© 2016 IBM10

To know what is trending and why Driven by the

power of Watson

ibm.com/watsontrend

AnalyzeVisualize and discover insight in

unstructured data through NLP and text analytics, content analytics and

cognitive insights

Explore Explore information from

internal and external content including unstructured text, emails,call center

records…

InterpretApply cognitive capabilities to enhance, scale, and accelerate human expertise

© 2016 IBM11

http://www.ibm.com/analytics/watson-analytics/

IBM Watson Analytics for Insurance

© 2016 IBM12

The Weather Company… leveraging external forces

# WeatherMeansBiz

Weather-related auto

damage is significantly

reduced or avoided

© 2016 IBM13

For marketers

Real-time personalization Through tools that continuously

learn from individual

interactions, marketers can

optimize offers and content for

each customer journey based on

progressive discovery of intent

© 2016 IBM14

Leverage Watson personality insights

© 2016 IBM15

To engage with personalized content Wherever customers and prospects are on their journey

Understands Natural Language Engages in interactive conversations

personalized to customers

Communicates insight-driven

answers/recommendations

with confidence

Provides multiple channels for

self-service

Personalizes from Interactions Leverages personality insights

Learns and adapts with

every interaction

Continually builds a relationship

‘memory’ for each customer, creating a

highly personalized relationship © 2016 IBM16

For marketers

Deliver Compelling Digital ExperiencesCollaborate with a single view of

a customer’s journey and

continually improve customer

experiences

© 2016 IBM17

Leveraging cognitive

capabilities for

enhanced digital

customer engagement

To build and deliver compelling digital experiences

© 2016 IBM18

For Customer Service

Commerce Insightsto gain in context insight and

obtain recommended actions

based on real-time evidence

© 2016 IBM19

IBM Watson Engagement Advisor for Insurance…the cognitive customer care platform for Home and

Auto insurance subscribers

© 2016 IBM20

Extend expert personalized advice.

Strengthen relationships through better

customer advice & information sharing

Increase revenue through better informed

next-best-action, cross-sell / up-sell

Improve operational efficiency

Self Service Virtual CSR

© 2016 IBM21

Watson Wealth Advisor

A set of services enabling advisors to understand client needs, engage with

clients based on individual sentiments, personalized events & news and

provide evidence based advice© 2016 IBM22

Master the art of the possible…

Deliver personalized messages and offers through intuitive always on engagement

Deliver at the just right moment seamlessly across all channels

Driven by insights to pivot between aggregate trends and individual behaviors

…Deeper human engagement

© 2016 IBM23

Octagon InsuranceRemoves the obstacles that were prevent customers from converting during the online application process --

all powered by IBM Customer Analytics solutions.

22% 40%Increase in

conversion rates

Reduction in

validation errors 330%Overall ROI

© 2016 IBM24

A French InsurerUses analytics to gain insights to predict which customers are most likely to buy which products and

customize their marketing messages to them individually -- all powered by IBM Marketing solutions.

50% 60%Email

open rate

Reduction in

email costs 2x Increase in

growth revenue

HumanaEngages members with personalized, meaningful, timely and relevant communications -- all powered

by IBM Marketing solutions.

180% Increase in

email open rates 12MMembers provided

with relevant

communications

© 2016 IBM26

A Major U.S. InsurerA U.S. insurer of autos, homes, and small businesses implements a suite of IBM solutions to enhance

customer experience and analytics on its eCommerce site.

EnhanceEnhance

customers’ online

experience

Gain ability to

proactively resolve

issues before they occur

Improve overall

operating

efficiency

© 2016 IBM27

© 2016 IBM28

Customize Customize

customer advice

Develop more

personalized engagement

Create compelling

online experiences

A Leading Insurer Uses Cognitive ComputingA leading provider of consumer insurance uses Watson natural language capabilities to answer questions

and provide coverage counseling about the company’s products and services.

A German InsurerA German insurer uses cognitive computing to analyze customer communications, including customer

mood

© 2016 IBM29

Tailor Customize policy

servicing

Tailor responses

quickly & competently

Enhance customer

engagement

Master the art of the possible…

Direct-to-consumer cognitive virtual agents that serve, guide, & advise on web or mobile

Advisor-facing applications that provide agents & advisors with guidance for customers

Employee-facing applications that aid knowledge workers in execution of business processes

…Cognitive processes and operations

© 2016 IBM30

Read and understand the natural

language contained within unstructured

documents, continuously learn based on

feedback

Create a comprehensive evaluation

process to collect, integrate, visualize and

evaluate risk

Use cognitive reasoning to rapidly parse

relevant evidence and generate

hypothesis.

31

Maximum Age Criteria: Born after January 14, 1945. DOB: 1/15/1950

Total Cholesterol = 276and HDL ratio= 5.1No information provided in submission

Blood Pressure Reading: Not to exceed 140/80 age ≤ 55, Not to exceed 140/90 age > 55.BP: 135/85

DUI/DWI history: no incidents in the last 5 years.

Cardiovascular disease: none.No cardiovascular disease. Last examined 2 years ago.

Universal Life Underwriting Guidelines

Health History

Watson Underwriting AdvisorEnable Underwriters to work more efficiently

© 2016 IBM31

A Large Peruvian Insurer

A large Peruvian insurer is preparing to use Watson Content Analytics to transform claims processing for

health insurance

© 2016 IBM32

Transform Develop deep insights

into key trends

Transform claims

processing

Improve claims

decisions & speed

© 2016 IBM33

Insurers Reduce Regulatory CostsIn the near future, cognitive solutions can help insurance providers reduce costs imposed through

differing regulatory regimes

Enhance Reduce costsEnhance risk

assessment

Improve premium

calculations

Improveautomatic

failover for

disaster recovery

data

security

operating

flexibilityIncrease Enable

© 2016 IBM34

A New York-Based Insurer

Optimizes the performance of message flows -- all powered by IBM B2B Integration solutions.

Driven by the power of Watson

When insurance gets cognitive,

amazing things happen.

© 2016 IBM35

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© 2016 IBM36