Lori Pon – The Auto Club Group (AAA)

Director, Claims Transformation and Claim Contact Center

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On this episode of Digital Transformers, we'll speak with Lori Pon, Director, Claims Transformation and Claim Contact Center about how The Auto Club Group is continuing to digitalize and match customer expectations.

About The Guest

Lori Pon is the Director, Claims Transformation and Claim Contact Center at the Auto Club Group (AAA). Lori is a leader in insurance digitalization and a prolific speaker.

About The Hosts

Graeme Gilovitz is the Global Business & Sales Development Leader at Lightico who loves nothing more than a digitally complete journey. Eytan Morgenstern is the Director of Media Communications at Lightico who tells the stories of those digital journeys.

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Transcript


GRAEME GILOVITZ	Hey everyone and welcome to this episode of the digital transformers podcast here at the podcast. We’re obsessed with how companies navigate the rapidly changing environment that we find ourselves in every day. And we especially love talking to leaders from a wide range of industries about how they are meeting the challenge of digitizing their business and customer interactions. Yeah. Hi everyone. I’m Graham Gilovtiz
EYTAN MORGENSTERN	and I’m Eytan Morgenstern and we’re your hosts on the digital transformers podcast. Today we spoke with Lori Pond director of claims transformation in the claims contact center at the Auto Club Group, part of AAA. We had a good informal chat about technology, human behavior and expectations. One of these we spoke about with Lori was that less than 5% of FNOL percent of F N. O.
EYTAN MORGENSTERN	First notice of loss is done digitally And that sort of seems to contradict a survey we ran recently says that 90% of consumers want a mobile-first claims process when filing for a claim with the insurance company. Um but if we listen to the conversation here, you’re going to hear how Laurie explained that those are not actually mutually exclusive and it’s a lot to say about that. So listen in. Hey Lori, thank you for joining us today.
LORI PON	Thank you for having me.
EYTAN MORGENSTERN	So to kick off. Today’s a podcast. Can you start by telling us a bit about yourself and the auto club group.
LORI PON	Sure. I have been employed with ACG for over 15 years. I lead claimed strategy and innovation. So any emerging technology or any enhancement that impacts our claim user community. I have a technology team that reports to me and we test, we curate and basically all the way through the ideation to the implementation to include user acceptance testing and organizational change management runs through my claim strategy team and we also oversee our claim technology robots. We work with our claim leaders are cheap claim officer in delivering best in class solutions to our claim community.
GRAEME GILOVITZ	Well that sounds like quite a mandate you’ve got there. Yeah,
LORI PON	I should be all gray
GRAEME GILOVITZ	looking, good looking, good. With that sort of mandate, Lori, you would you identify with sitting more in I. T. or with the business?
LORI PON	That’s a really good question. Yeah, that’s a super good question. Uh We actually report directly in claims were unique in that we are part of the business. We collaborate with I. T. So there is an I. T. Senior project manager or director that we touch base with and that we coordinate with but we are claim professionals that have a technology component to our job. So we understand the claim life cycle and we write all of the use cases for any technology that touches our claim and users and we exercise the technology. We work with our vendors, we alpha and beta for a lot of our vendors and we work together to deliver very insightful and well thought out solutions. So I thank my cheap claim officer for investing the headcount and the energy into partnering with I. T. So that we have very a really insightful and thoughtful way of how we can improve adoption and roll out solutions that benefit the customer and the user
GRAEME GILOVITZ	sounds very, very interesting, especially given that most of you come from a background of claims management and the moving slightly towards that tech side, look at the process is a lot of insurance companies and and a lot of our listeners may or may not be aware. But a lot of insurance companies have these things called labs where they’re testing stuff, whether it be the building of the product, testing out the claims and the technology. Would you consider that be a description that you would put upon yourself in your group or would you differentiate yourselves from that?
LORI PON	So wideatee do test uh innovations. I don’t know that I would call us a lab were more of a technology team that we help with the build the cost benefit analysis, we help prospect for new technology and then for our vendor partners, we do, as I mentioned before, partner to alpha and beta and we want to be part of the conversation on how their roadmap is laid out, how it iterate. So we are very interested in partnering with insurtechs IoT s that allow us to be part of that conversation. And so from that perspective I’d say we do ideate uh technologies and work with both IT and our external partners. Yes I guess in a way we are
GRAEME GILOVITZ	interesting. I’ve got an interesting question for you. So when I think about insurance it’s probably one of those products that the average individual like you and I if you were working for insurance group it’s like a set and forget you buy it once most people probably pay for it because I think jeez if I don’t God forbid something should happen then I’m really up the creek without a paddle but it’s something that they think all right I want to buy it once. I never want to know about it. And I heard you talk previously where you said that less than 5% of your F. N. O. L. And for our listeners who don’t know what that means. It’s the first notice of loss are done not via the digital channels, which means that most people are going to call in, which this is the first time I’ve ever heard that 5% are done
GRAEME GILOVITZ	Via digital, correct? 90 so less than 5% are done by digital. And that made sense to me because when I’m if I was to make a claim, I think I’d be pretty emotional more than usual. You know, I’ve had a car accident, I actually had a small banging a couple a couple of about a year ago and I didn’t realize how much I didn’t remember and how much information I didn’t get at the time. I’m not going to go to an app. I’m not gonna go online. I want to call someone. Right. So those numbers that you have at the moment, is that what people and companies expected or were they really hoping that FNL FN OL numbers would actually be a lot higher on digital adoption.
LORI PON	So we are providing more channels to encourage more digital adoption. But even when you look at some of the J. D. Power’s numbers, most companies are between 14 to 25% intake. So there is still a large contingent, even gen y gen action alpha, I think that most of us are not experts about the contract and when you read an insurance policy it reads like a contract. So what we’re finding is if we can do a great job delivering empathy at scale whether that be through digital channels, sometimes it is telephonic but specifically let’s stick with the telephonic realm. Uh Typically we do a pretty robust capture at the Auto Club group, we set up services for you and we help set expectations and what we’re finding is much better, better digital adoption and transition into digital. If we do a great job taking the first minutes of loss, we set expectations and we even offer you the capability to bi directional text with us. So basically we offer to set up a tech stream between you and your claim adjuster. We’re finding much better digital persistency post FNOL when basically we can set the pathway what’s going to happen next, explain your coverages. So we’re seeing that the sentiment is really amazing if we handle the interaction uh over the phone, and then we’re encouraging you to also reach out to us through our digital channels. So we’re seeing better adoption post stefano. Well, so that’s specifically an eventual stat. But we aspire to have more straight through and digital interactions. But we’re a membership organization. We want to provide our members channel of choice. We have policyholders across different spectrums, so baby boomer all the way to gen Alpha.
LORI PON	So we want to be able to offer channel choices a membership organization and part of being a membership organization is making sure that all of those channels are very empathetic. So that’s, you know, one of those things that we aspire to improve. But at the end of the day, I think you’re right, A lot of people don’t understand the difference in their coverages with explanations are, and once we give them that quick fol experience, we’re finding better adoption posted in a while.
GRAEME GILOVITZ	It’s one of those experiences that most people don’t have until they have it. So it’s like, you don’t know what you don’t know until, you know, you don’t didn’t know it. So for a lot of people, it’s like a lot of people I work with were younger. They’ve never had a car accident. They don’t thank God and they’ve never been through that process. So trying to explain it to them, they’re like, I just don’t get it. Yeah. Yeah, I would use an app and I’m like, really? Let me tell you when you have a car accident, you, the adrenaline’s going through your veins. You are not thinking, oh, I’m going to go to an app. You’re thinking, oh my God, am I safe? Have I got everything I need to know? Oh my God was at fault. And what does this mean? Can
LORI PON	you give me a car rental? I have to have my wheels to get to work or to
GRAEME GILOVITZ	collect my daughter in two hours. Oh my God, my car has been totaled. Okay. These
EYTAN MORGENSTERN	are, these are instant
GRAEME GILOVITZ	needs.
EYTAN MORGENSTERN	This isn’t
GRAEME GILOVITZ	a logical thought process.
LORI PON	Like I’m not ordering a T shirt off a website. You know, I’m not ordering a product that I can then shop. And so for us claims as a differentiator. And if we can touch our customers, whether it be digitally or uh email, phone texting, we want to be able to offer a channel of choice and sometimes channel of choice starts and voice and then we can migrate you to a faster, quicker channel. And so we want our customers to be able to uh navigate throughout the claim through those different channels that make sense for them. So like if I’m going to tell you that you’re negligent for the loss after I reviewed your police report or I’m totaling your car, I need to probably have that conversation with you versus texting you because that could be very upsetting. So even when we talk about digital, we talk about channel of choice for our adjusters and our claim representatives. That’s a conversation about how you manage your channels. What make sense? We have guidelines around. When does it make sense to text or email? When does it make sense to pick up the phone? And sometimes that is a lost art. And so we actually are linked in on organizational change management. And how do you take this new tool in your basket and use it in the most optimal way. And so we’re seeing great sentiment on our digital channels but we are applying sentiment analysis to our sMS messages and right now it’s fairly basic, it’s positive and negative and so that immediacy is really amazing and that it gives our managers opportunities to coach so we can see the interaction as it unfolds.
LORI PON	So we are very leaned in on how we help our team understand how you put that tool in your basket and how you use it to maximum effect is what is best in class look like because some of our adjusters I think are really amazing uh in humanizing digital interactions and others. I think it’s a little more transactional. So we’re spending a lot of time on business readiness and O. C. M. To help our users understand this is what best in class looks like like in my unit we had a text of the day and it really highlighted who was touching our customers in a way that was creating a memorable experience because claims gives us an opportunity to bond and hopefully you’ll renew because we did such a great job on trying to get you back to where you are pre lost. So it’s those kinds of things that I think you really need to be thoughtful around.
EYTAN MORGENSTERN	Yeah. I think it’s interesting thing I I recently read in my car insurance and having been through a few, not my fault, but accidents, so I had to deal with this. Yeah. For our listeners out there, um I, I understood the value of even paying more essentially if I know I’m getting good service because I know on the day of that kind of issue happening, knowing someone to be on the phone with me quickly or whatever and handling these for, for me quickly is worth paying a few extra dollars. So I think that’s the kind of thing that you don’t always think about when you’re first shopping or we have no idea what’s going to happen. Okay. Although the cheapest option, right? And it’s not always what, what is, what is necessary really. Um but I won’t actually go back to you mentioned before your digital tool Bhaskar toolbox. Um you know, can you explain what that is? Um, and you mentioned before, you know, the use of bidirectional smS sort of expand upon what that means, what you’re using that form and sort of the feedback from
GRAEME GILOVITZ	your customers or members rather
LORI PON	sure. So as a membership organization, one of the things that we focus on is how can we be there for you at your ultimate time of need. And in my humble opinion, it’s a claim, right? So you’ve experienced a loss whether it be to your home. So we offer property and casualty insurance um, in across the midwest and the South east and we want to be able to offer our members an opportunity to get paid quickly. So we partnered with a Fintech at the end of 20 2020 to stand up virtual payments and a series of virtual payments not only for our insurance, but also their providers, whether it be a medical provider, a repair shop because some of the timing around paying means that my car will be released from the shop or my provider will get the payment they need so I can continue to treat or I need a payment so I can go get a new car if I have a total loss. So we stood up a interface with a basically a digital um a fintech and we implement a digital payments. We start, we soft launched it in november with a small subsection of our claim adjusted adjusting community. So part of our business readiness is where we can to launch it small before we do big bank to our entire user community. So that helped us get out our processes, helped us tweak. And so we offered virtual payments uh to all of our customers starting in December of 2020. And we’ve had great success. We just recently had a major storm event in one of our biggest states Michigan. And when I went back and looked, so last week I had done a look at all the claims Where we that were impacted by the storm event. And I was really surprised to see that over 37% of our payments were issued digitally within a couple of weeks of the event. And the average time to get the payment was 1.42 days. So we send you we sms you um a request to accept the payment. You have two key in a secure portal.
LORI PON	Either your banking information, your credit card, your debit card, whatever method of payment makes sense for you. And basically we transmit the payment and debit cards faster because credit card companies typically have more sophisticated web services and, and the bank depends on how your banking institution processes. A CH And I was very surprised yet really excited to see that in our customers time of need. So a lot of our customers experience water loss to their basement or their car was flooded if they were involved in, you know, commuting during when the event occurred or their neighborhood was flooded. So I felt really great that over a third of our payments were processed expeditiously and that means money in hand, either to the provider or to the customer. So that’s one uh really big enhancement that we worked on. So when Covid hit this really hit home for us, all of our adjusters, uh we’re basically working from home, we still have over 98% of our team members working remotely. So we wanted to provide that tool. And then on the smS side we partnered with to ensure text. In early 2020, I had the fortune to incubate the idea and piloted in a quick claim handling unit, auto and home that I directed. And so we piloted both tools. We picked the winning vendor and we were planning to roll out iterative Lee to our entire audience. And then when Covid hit, we’re like, we gotta figure out how to flip the light switch on and go big bang. So it was a lot of effort, but I’m happy to report by September of 2020, we rolled out bi directional texting. So basically what this allows us to do is we can ask you have to get your consent to text regarding your claim and we set up a conversation between you and your adjuster and then other members of the claim team, like your field adjuster.
LORI PON	It could be someone else that needs to communicate with you regarding your claim. We can have group conversations with you or typically it’s between the customer and their handling adjuster. But basically we can chat with you regarding your claim. You can send us pictures, we can send you documentation that we need to send you or if you want to provide us an update like you’re bringing your car in on friday. That helps us understand status acclaim and then we can push you status of your claim. We have a eyepieces that we employ with our sMS tools. We have a partner and ensure tech that we work with. And so this has allowed us to reduce phone tag, your phone, like my phone is typically within about a foot of where you are. So we’re seeing great sentiment and we’re seeing better closure time. We’re seeing better mps and we’re seeing a reduction in phone calls to the adjuster because you have the capability to communicate on demand. So those are just two of the tools we rolled out in three Q and four Q of last year that are really showing big benefits. So and on the back end, we’re partnering with our ensure tech and fintech partners to see where we can make improvements. So we have optimization, protocols and meetings and we’re actually really excited because our Fintech vendor and are insured tech vendor are working together to bring in the virtual payment side into the same ecosystem. So we’re even working with our partners on how we can partner across our insurance space even more effectively. So that’s exciting too. So I’m part of that project. So a lot of good stuff
GRAEME GILOVITZ	sounds interesting if you’re doing bidirectional sms. Is that in a way taking away for the need for your customers to use your application on your mobile phone? I channel.
LORI PON	I think that we still want our customers because today we offer our digital FNL through our app. So we still want them to interface with our app because you get discounts, you can text to tow, you can order up a toe, use your GPS. So for us as a membership organization, we’re a club, we offer the towing the lockout. You know, if your bike is stranded in the park will even come and pick up your bike. So we do want our customers to use our app. But we also want to have a K. A. The capability to uniquely almost like you’re texting a friend to be able to offer up a conversation. It’s in your messages, like you would be texting a family member and be able to refer to it in a very unique way. So we also want to curate the experience as it relates to claims that we have, especially if it’s a serious claim or if our customer needs to communicate us about, let’s say it’s their car, they need, they’re bringing it in, they need the rental reservation. So we did want to provide the capability to keep it as top of mind. So, you know, maybe at some point will integrate it into our app. But I still think we have a lot of other things that we expose in our app that makes it beneficial to you to use both.
GRAEME GILOVITZ	Yeah. Okay, interesting. Um, I think I saw you talk on a recent podcast or webinar may have been late last year. You talked about transitioning customers and you mentioned here earlier between from one channel to the next. And I’ve been around a lot longer than 18 where people have been talking about, you know, uh, multi channel and Omni Channel, but companies have really failed to make that a reality. But it seems like you are, you guys have really tried to make that happen. Can you explain a little bit more from your perspective, how you’ve made that Omni channel jump?
LORI PON	So what I’ll tell you what I’ll tell you is we still have aspirations to make that more seamless. So I’ll give you an example so you can report your claim to us digitally and were able to register your claim for auto. We don’t have that experience that for home. So, um, we still have aspirations to build that out. But I think one of the things that we’re trying to do is encourage our team. So at first it’s a loss if you call us, we’re offering to set up the conversation with you and your adjuster. So in a sense where offering a concierge service to begin the conversation. So we partner with our ensure attack we use their digital assistant so their ai to actually invite you once you chat. Yes. Back to us. Uh We confirm the adjuster their email and their phone number and then there’s the chat. So we’re trying to. All right, number one focus on the with um for our user community. So like with digital payments texting some of this, our customers might not know that it’s available unless we offer it to you. So some of the ways that we’re trying to improve adoption is offering it for sinners of lost. Our first sense of loss agents will offer to you and once it’s set up really your claim adjustor has the responsibility to respond to you in your channel of choice. And then on the digital payment side. Uh, we’re making sure that we communicate, here’s the weapon for you claims where we digitally pay. We have better mps. And then on the back end we’re offering incentives to our adjusting community. So we have an NPS incentive program. So the better my Nps is I have opportunities to earn incentive. So we’re also trying to incentivize it on the adjusting side. And then we’re providing the hard core stats and KPI set show on claims. Every tax on claims. We offer digital payments.
LORI PON	The experience on average is a lot better for our customer. And for you there’s less phone tag, there’s less calls proclaim. So we’re kind of approaching it from a customer standpoint and a user standpoint. So that marriage of the two were hopeful that are adjusting community will lean into the tools. I’ll give you an example in four Q. We piloted with our insured tech uh texting vendor, their mobile app. So when we launched in september, we didn’t have a mobile app by october and november, we were ready to pilot it. So he posited with a group of team members, we met with the development team and we were giving feedback on how to curate the experience and what our claim adjusters in the field were experiencing. And then what’s interesting is we rolled it out in december, which is not a great month to roll it out considering all the holidays and then I had leaders emailing me or skyping me to come back and do another road show for their adjusting community because they had pockets of a justice that we’re really using it and seeing great gains. So, you know, we continually look at what is our approach to rolling out the tool and how do we, how do we influence and hopefully share the benefits of leaning into some of this technology? Because you have users that are great adopters, early adopters and then you have users that, you know, are more of a hard sell. And I hear that from a lot of my colleagues, so we try to attack it in different ways to, you know, try to share that with them.
EYTAN MORGENSTERN	Yeah, I think it’s, you know, adoption, you know, having great technology is obviously key, but adoption is also a huge challenge, especially for this kind of thing where it’s not a daily interaction with the insurance company. Right? If my bank, I have their app, I’m using all the time, That’s fine and insurance and using it once a year to renew and a
GRAEME GILOVITZ	claim. I don’t even have an app for my insurers like you know, I’m hoping not to talk to them. It’s no disrespect to you guys. But I never want to talk to my insurance company. It’s like going to the dentist. I like you but I never want to talk to you or the doctor. These are the people that I try to avoid. Right? Right? Because
EYTAN MORGENSTERN	you would mean something bad is happening
GRAEME GILOVITZ	culturally correct. So I’m happy to have the coverage but I would prefer not to. But if I do need to speak to you, making me feel like making soothe me because that’s my console me and helped me through my
EYTAN MORGENSTERN	crisis. May need to have like a like a Spotify plug in and that’s where your insurance, you have Spotify on your phone. Anyone you have insurance through their maybe instead of having a
GRAEME GILOVITZ	separate out, but there you go, you go with that in the next digital.
EYTAN MORGENSTERN	That’s free advice for everyone out there.
EYTAN MORGENSTERN	So let’s, you know, you talked about a lot of different ways. You can play a new technology, bringing insure tech, bringing in this kind of thing, you know, in general about modernizing a legacy system. Right? The auto club has been around for a while, um, and most obviously most bigger brands insurance around for a while. And you mentioned, I think we spoke last week before this, this uh, podcast, how you guys had, you know, emanates with, you know, eight or nine different companies in the last couple of years. Everyone has their own technology. How are you working to bring all those technologies together so that your customers feel a seamless sort of uh, interaction with, with the auto club group?
LORI PON	Well, it’s challenging, it’s surely a challenge. And our senior leadership team announced a very aggressive and accelerated insurance policy modernization efforts. So we’re looking to move our legacy products into a more contemporary Rised Policy management system. And so very recently, in april my role was pivoted to focus solely on strategy and innovation. In part of the issue for us is making sure we have resources dedicated to support it. So there’s a minimum of disruption to your user community. And for us, getting all of our products onto a modern platform allows us to integrate with partners more seamlessly offer the same experience to our customer community. So like today, we have digital payments in one of our claim systems. We don’t have, uh, digital payments and all of our systems. So through merger and acquisition, we uh have different systems both on the policy and the claim side. And that just creates a lot of technology debt. It creates a lot of training. I and I think you’re, you have, we have inconsistent experiences depending on what system you’re because you’re not going to build integrations to every single system that you have because then there’s redundancy. So we’re really focused on getting to a modern platform. And I even seen on telephony side where we’re trying to consolidate our telephony, we’re even looking at moving our telephony from on prem to the cloud. So I see us even shifting from on prem to the cloud with a lot of our solutions. Uh, so, you know, that’s one of the reasons why I’m committed to focus on technology that migration and making it seamless and just being really thoughtful, but it’s a huge effort and we’re on a aggressive to your road map to get our legacy systems into our more modern policy platform.
LORI PON	And then I think we’ll look from the claim perspective to uh bring in our other claim management systems to one platform. So it will also make us a lot more nimble for cat response. So we have uh florida as part of our footprint and you know, there’s storm exposure there and it makes it difficult when we have resources in our other parts of our footprint going down to florida and needing to learn a new system that always presents challenges. So I think in the future we aspire to have a common platform so that were more nimble and agile
EYTAN MORGENSTERN	when you’re bringing in, you know, you’re you mentioned before they ensure tech and so on. Obviously I assume that’s plugging into different A. P. I. S. And what are you there is part of your thought process. Okay. How can I bring in technologies that address certain issues that I can then easily port into other, you know we have the court system here, in the court system there and the court system here and those technologies allow you to essentially um apply that sort of outer layer, right? They ensure tech or the payment, whatever it is to all those at once.
LORI PON	Yeah. So what we’re looking for is, you know, I imagine the claim system is your hub and today we’ve got a lot of spokes, two different technologies, right. And it’s not always very seamless and elegant. So we’re looking to build those seamless experiences whether it be fully a fully digital claims which straight through and it’s seamless. And so I think we’ve got some work to do with all of the different systems that we have and a lot of the insured text and context of the world are partnering with the big package software, um, companies and offer accelerators. And today we can take advantage of as many other accelerators as well. Like so these are customs uh, implementations that where where it’s a big project to create the standalone ap I even though it is connecting through your claim management systems. And so what ends up happening is you kind of have an experience that takes longer than you want from a speed to market perspective. And so we’re aspiring a time to do exactly what you’re talking about is have a more plug in play where the time to implementation is drastically reduced because you’re just consuming one of those api so there might need to be a customization here and there, but it’s not a completely, you know, you’re, you’re starting from scratch almost. So that’s really what we’re looking for.
GRAEME GILOVITZ	I heard a very interesting stat a couple of weeks ago. Um, so don’t quote me on it because I think it was for every $1 you spend on getting new technology that’s in the cloud, companies will spend between 3 to $5 to patch up a legacy system because people think, oh my God, this is going to cost us millions of dollars to to upgrade and move it to the cloud and all this stuff. But they don’t realize, hold on, every patch is costing you money and every year it’s costing you more and more and it’s getting harder to add on these additional plug ins that are going to allow you to be digital first. And at some point you need to bite the bullet as they say and say that’s it. We’re not going to fix it anymore, to rip the band Aid off, Let’s rebuild it properly.
LORI PON	Well, we have some of our systems are still in COBOL, believe it or not. And so the talent is leaving the organization may be retiring and that’s just not a talent that’s in the market, uh, that potentially is available to you. So it gets much more expensive. So technology debts really been a conversation. We’re doubling down the pace of our legacy system. Policy modernization effort is really pretty epic. And so I’m really excited to have been repositioned to lead claims in this journey. And so I really see us doubling down. I see way more effort to get us there than I’ve seen in prior years. It’s been aspirational. But I do think impacts of covid impacts of just that expense and the fact that it’s very expensive to have these multiple instances. And then from a talent perspective, I mean when you have talent coming in organizations and you’re still using green screens really. So I mean you even look across like you’re not may be attractive to the talent you want to attract. If you have technologies like saying, oh come over to my house, let’s play Atari. I mean you come on, you probably laughed me out of the building. Yes, exactly.
GRAEME GILOVITZ	Atari is actually cause actually thinking of re buying an Nintendo mini like the other ones because I like the old pixel games. But I can, you know, I never actually considered it from a talent hiring perspective, if you’ve got really old technologies that people don’t have the skill set for, if they do, they’re probably going to cost you absolutely, I’m in a leg because nobody there are a rare commodity. And thirdly if they’ve got that old technology, how are they fitting in with your newbie technology people? You may have a cultural
LORI PON	dispute. We have kind of a divide graham. You make a really good point. So today we run you through a training program to take persons of loss for us. And it’s a program that’s about five weeks. We’re teaching the principles of insurance. We’re teaching you are really based system. So this is our more contemporary system. And so uh included in that whole journey is a mocking live called certification because we really believe in vetting you prior to you interacting with our members. So we want to make sure the quality of your call is really great and also that your interaction is great. So there’s empathy engagement. So we do evaluate those components of your uh performance. But we, at some point during your first six months tenure, if you’re taking first of loss for us, you come back in to another eight day training to learn our legacy screens. There’s a lot of manual coding, you’re using your P. F. Keys and some of our talents like what is this system? What is this like? They’ve only ever been in a gooey world. And so what’s interesting is there is that divide where some of our tenure staff love the green screen because it’s intuitive to them and where we have team members that say, what am I back in the eighties? What is this or the seventies? And
GRAEME GILOVITZ	The 80s were good. The
EYTAN MORGENSTERN	80s were good not for computers, for music computer.
LORI PON	So I mean we see it today at A C. G. But you know, we’ll get there and we’re really on a very uh you know, we’re on the fast train to get there and I really see us doubling down. So uh, you know, I’m very hopeful that we will continue to iterate and improve the experiences we offer our members.
EYTAN MORGENSTERN	Yeah, yeah. I think, I think it’s, you know, a key thing to sort of figure out how you bridge that gap. I want to switch gears for a second. It’s related obviously, but we spoke to an auto lender from Florida recently, um, and they had implemented a technology stack essentially in order to work remotely about two years ago now, about mid-2019. Um, and the reason they did that was because they had a problem with business continuity during hurricanes. Now when they did this, they didn’t know that obviously coronavirus is coming prepared them to in three hours, pack up their offices, go home and work remotely for a year while the rest was trying to figure out how to do this kind of thing. Um, so that brings you a question about, you know, predict and prevent versus detect and repair. Right? How do you, uh, what are your thoughts on that? How do you approach that kind of, uh, investment? Uh, and sort of a way of thinking.
LORI PON	So, I mean I’m hearing a lot more about it in the industry and we’re really leaned in so I can start with part of our ecosystem. So like a home claim, if we as an insurance company would give you a device to sense a water leak in your home instead of calling in a claim where you have to pay your deductible, you’ve got a sensor that you install, you install the app and it tells you, hey, I think the water pressure looks odd. I think, you know, we’re sensing what typically would lead to a leak and potentially more expensive repair drywall issues having forbid a flood right of water into your property. So that’s from the standpoint of prediction, it’s better to predict and prevent a bigger loss. So maybe it’s a $80 maybe 100 $50 called a plumber versus 1000 $1500 deductible if you had a home claim. So that’s very interesting to us. On the telematics side, we are offering our app if you’re a member, which is different than most insurance companies. So we do have a use based insurance product where we’re incentivizing you. So we’re using ai we’re using uh basically you install our app on your phone, it will warn you like during your journey, it scores your journey basically. And in a way it’s gamifying, right? So, uh, you know, you can, I don’t want to say compete, but you can certainly compare across your household and you know, you lose points of your heartbreaking if you’re exceeding the speed limit depending on your route. So I think from a predicting and prevent, I’m gonna have a young driver in about a decade. So I’m probably going to want that level of forensics to coach. So I was I was
GRAEME GILOVITZ	actually gonna ask you, sorry, I wanted to ask you that because it’s just going through my mind. There’s there are technology out there they’ve been talking about for years where um You should be able to tell through Ai how far someone drive. So if I’m driving I’m a little bit heavy footed compared to my wife. I think I’m a Formula one driver more like a sunday driver. So you know, and therefore that’s how policies in a way should be scored based on not how old you are and what sex you are, But what sort of driver you are? What are your thoughts on that? Because that’s also part of that predict and prevent.
LORI PON	Right? So there’s this whole concept of social using behavior behavioral science and social economics. Uh you know there are even companies that offer incentives if you’re a good driver so you can go and pick a incentive right? It might be, you know, a card to your local coffee shop or some other incentives. So I think across the insurance ecosystem there can be I think a lot of innovation around how can you incent better behavior uh before the loss right? Or before a situation where uh you know, you’re calling us to file a claim maybe because you were heartbreaking or you were speeding or you were distracted driving. So our apple even measure if you’re interacting with your phone while you’re driving. And so that a trick your score. And so for you, space insurance, we’re trying to incentivize you through your score. But there’s also this concept of, well what if I’m always a great driver uh what are you giving me to keep me on that pathway? So we’re looking at different uh systems of incentives because I think it could pay dividends if you’re deterring claims, right? And then that whole smart home ecosystem, there’s a lot of rich data in the smart home that could keep you apprised like you know I don’t have an app that tells me if my smoke detectors have low batteries there is that chirp right? That you would typically here but you know maybe there are other smart home, there’s a lot, there’s just in that IOT space there’s a lot of things that we could consume that would help us um prevent. And then when you talk about the connected car, that’s a whole another um aspect, right? Because you have all of these systems like eight S. Systems which are also more expensive to repair.
LORI PON	Uh but this whole concept of the connected car and what could you be harvesting and helping uh to provide better insurance rates depending on how you operate your vehicle. So it’ll be interesting to see where the industry goes. But I definitely see more of a focus on predicting and preventing because you don’t want to your members heard or to experience a claim. I don’t think anyone that’s not going to make anyone’s day right to have to call in the whole disruption. So we’re really looking at different technologies and how we can leverage them. But I’m really excited that Triple is offering the app are us based insurance app or telematics app. Even if you don’t buy the insurance, you can still contribute to the data and see you know how you’re driving. So say you want to remember, but you’re insured elsewhere. You can still kind of get coached on your driving behavior.
GRAEME GILOVITZ	Yeah, it’s good positive reinforcement for the benefit of All right. Because if you, especially on things like car accidents, it doesn’t just affect you. It affects others and it can be very detrimental. So anything that can lean towards providing positive reinforcements on the things that we want. This is what this is how we teach our kids right? We’d like to write, listen, I’ve got one last question for you. Hopefully it’s not too controversial, Laurie and I’m putting you on the spot here. Um, but it’s something that it’s been on my mind for the last couple of days knowing that I was going to talk to you. I don’t know why, but I think you were the one that inspired me. You know, there’s a lot of companies that talk about, I think everyone talks about being customer centric, right? We’re about we’re a customer first organization, etcetera, etcetera. But at what point does bottom line, does technology to drive, bottom line product profits? Is that supersede technology to enhance customer experience? Right. Because I think at some point they’re both very, very important companies today. It’s a very competitive landscape. Shoppers can move around pretty quickly. So when you have a choice, what, how do you make a decision between, Okay, technology isn’t gonna give me a dollar like ultimately the primary is going to get me to make more money for my organization or for your members or is it to go for experience? How do you make that decision? And it might be both? Which one sort of the drive correct? They’re not going to be the dividend is not gonna be equal, right is never going to be an equal, right? It’s like I love my kids, but do I really love them equally?
GRAEME GILOVITZ	They’re not gonna listen to us. It’s okay. Right. That’s
LORI PON	An interesting dilemma. And you know, we’re a membership organization. So we have 14 million members across 14 states and US territories. And so for us, I think it’s totally a balance and there are times where we double down and say we have to implement this solution and this enhancement or this technology so that we’re providing our members with an experience because you have to be very mindful of customer expectations. So there are a lot of companies that haven’t really dialed in and customers are not comparing you against other insurance companies. Like to your point, I never look at my insurance. I wouldn’t know what an experience looks like cause I haven’t had a claim or my policies on an automatic renewal. So when your customer interacts with you, you need to have a channel of choice that’s elegant. And for us we do find it technology enhancements that the C. B. A. Is not always to your 0.1 for one. Now we do want to have a return whether that be an NPS, whether that be where we’re just getting more productive and were able to assign resources that supported X. Process to more maybe challenging activities that add member value. But for us it’s a really fine balance and the a recent storm event that I discussed that occurred I think presented us opportunities to even further spotlight where we could make our experience even more enhanced and how it would help us in the context of a cat respond more expeditiously. And I think we’re always looking to build out that experience but be mindful to your point. There is not unlimited budget, scope um dollars out there and resources so we really have to balance it. And so we work with I. T. R. Claims senior team.
LORI PON	We have challenged sessions and discuss what do we have to have and I think you have to create a memorable experience and we’re not going to always be the most technical company out there. But if we can provide you with an experience as a differentiator I think that we can make you want to renew and stay with A C. G. And we want to be top of wallet so we want to be your bank. We want to, you know, have your membership and fried. You discount on your local restaurant. You want to be your insurer. We want to give you your life, you know, offer you your life insurance policy, your travel. You know, we have a travel agency. So we’re trying to create an experience for our customers depending on how you interact with us. That will make you want to stay in our ecosystem. So for us, sometimes it is about looking at where do we have customer friction and where do we have to make this investment So that the claim experience is the key differentiator because typically most customers will tell you if I have a bad claim experience, I’m probably not gonna redo. So for us we have to make that seamless. And sometimes it is about investing uh like the bidirectional texting the digital payment piece. You know, we just had to do that uh so that we are offering you the capability to reach us at your ultimate ultimate time you need. And for us to pay you quickly, you know, typically a happy claim as a closed claim and were able to move to being able to make you whole faster if we can deliver your payment virtually. So we cut down our average speed. So a snail mail chak was about nine days from the day we we cut it to the day that it was mailed out to you to when you presented your bank. And on the digital side we cut that down to three days and some of that three is how long it takes the customer putting their banking information or.
LORI PON	Um But like our debit card transactions are really really quick as soon as we get your debit card information, typically within 30 minutes, it’s getting funded in your account. So
GRAEME GILOVITZ	yeah,
LORI PON	it’s really it’s so cool. It’s just it’s been life changing. I’ve seen great customer sentiment on our mps, uh surveys um in our smS messages, our customers are really excited that we are on par with other companies that can deliver that service in their time of need. And it’s like lightning fast. So um but you know, we can’t boil the ocean. Uh So we just we take it all in balance, you know, and I think one of the things that we do too is we have user community meetings and we ask our adjusting team, where’s your friction? Where do you think? Uh we could do better, be better. And then we’re continually indexing ourselves against our cohorts in the industry and you know, so that keeps you honest to.
EYTAN MORGENSTERN	Yeah. Yeah. I think it’s definitely a great sort of uh final statement here. I think as far as, you know, on my, my day of need, you have to always be on your top of game, right? You can’t have my bad day needs to be your best day to make sure that I’m getting the service I need. That’s a big challenge. Before we’re up here, up here, we have five rapid fire questions. Okay, he’s gonna be
GRAEME GILOVITZ	quick and she’s
EYTAN MORGENSTERN	looking worried she’s
LORI PON	looking for, and this is going to be
EYTAN MORGENSTERN	aired aired tonight on CNN just one section, so please make sure. Okay, so, um
GRAEME GILOVITZ	most recent or favorite
EYTAN MORGENSTERN	person you started following on social media, like linkedin or twitter. Mhm.
LORI PON	You know, it’s not a person, it’s the Harvard Business Review, so I’m following them on linked in. I love their two minute reads, I share them with my staff. Love love, love it. It’s very inspiring and helps keep me balanced.
EYTAN MORGENSTERN	Great one. Well, the
GRAEME GILOVITZ	next one.
EYTAN MORGENSTERN	Okay. And up to three words. The best part of your job
LORI PON	removing friction and user experience.
EYTAN MORGENSTERN	I’ll give you the fifth word. It’s fine. Uh okay. Apple or android.
LORI PON	I’m an Apple girl. Oh
GRAEME GILOVITZ	yes, we won from were one each. Exactly. I’m going to keep account of this. All right. I’m gonna say this one because I don’t know if this is a hard one. Is it digitization or digitalization?
LORI PON	I’ve seen it both ways I’m comfortable with both.
GRAEME GILOVITZ	So what would you say
LORI PON	I normally say digitization? Okay. Is that also that’s
EYTAN MORGENSTERN	That’s true for its two.
LORI PON	Yes. Okay.
EYTAN MORGENSTERN	Okay. Complete the following sentence. The future is
LORI PON	now you better be prepared.
GRAEME GILOVITZ	Wonderful,
GRAEME GILOVITZ	Lori, thank you so much for joining us today. That was a very interesting conversation we’ve had about a whole lot of issues with digitalization, customer experience and digitization. Look, I really appreciate. Thank you so much for coming on board.
LORI PON	Thank you for having me take care.