Relationship Builder
By Lina Fang, Michele Holtkamp, & Dylan Johnson
Executive Summary
Look at the device on which you are reading this summary. Is it a laptop? Desktop? Phone? Desk? Do you remember when you bought this device? How much did it cost? In what condition is this object now, compared to when you purchased it? Do you still have the receipts? Write all of this information down. Now, imagine having to do this for all of the items in your home. What about the priceless items? Family photos, heirlooms, and decades of memories. Imagine losing these items, and then being forced to assign a monetary number to an invaluable belonging? This is the lived, ongoing experience of many residents of Paradise, a city in Northern California razed to the ground in the 2018 Camp Fire.
The Problem
This painful experience is common amongst homeowners that are suffering post-disaster. Unfortunately, the insurance process to-date does little to prepare homeowners for potential catastrophe, or how the aftermath may look. Buying homeowner’s insurance is an opaque process, full of legal jargon and paperwork that 99% of american’s are ill-equipped to handle.
Furthermore, after the insurance sale process, the insurance agent is rarely heard from again, leaving the homeowner with little understanding of their protections against ever-changing circumstances, including new purchases and home risks. We wish to change this detached dynamic, using the Relationship Builder toolkit.
Our Solution
The Relationship Builder targets two points in the customer journey where we heard Paradise residents experience pain and negative feelings towards their insurance provider. The first pain point we identified was choosing the right home insurance policy. To mitigate the miscommunication and misunderstanding that can be prevalent in this part of the process, we want to use a proprietary machine learning/AI platform that will lead prospective policyholders to discover the best policy for their unique circumstances and desired coverage.
With this part of our toolkit, we aim to build a stronger relationship between the insurance provider and the policyholder from before the insurance policy even becomes active.
By helping the customer find the best policy based on their coverage needs, there will be less surprises should there be any damage to the home, and both the policyholder and the insurance company will benefit from an improved matching process.
The second pain point that came up multiple times in our discussions with Paradise residents was the emotionally-challenging and time-intensive itemization process that has traditionally been completed post-disaster by the policyholder.
Our toolkit enables policyholders in disaster prone regions to “flip the process” by allowing them to upload photos and videos of items in their home at the time the insurance becomes active, as well as for the duration of their policy.
It automatically updates the ledger to show them a real-time estimate of the value of the items that they can expect to recapture in the event of a disaster. Not only does this reduce the emotional burden of dealing with itemization post-disaster in order to get a payout from the insurance company and reduce the amount of time needed to complete this process, but it also serves as a mechanism for policyholders to “check in'' on their financial wellness by giving an accurate picture of their spending on physical belongings.
Conclusion
By providing policyholders with the opportunity to front-load the itemization process pre-disaster and enabling continuous updates to the ledger, the insurance company is increasing the transparency of the relationship with the customer and increasing the efficiency of the claims process for both the insurer and the insured. Implementation of this pre-disaster toolkit can serve as an effective way to bolster the ties between the company and the customer, resulting in a better, stronger, and more mutualistic relationship between them.
The insurance industry will undoubtedly undergo significant transformation in the coming years, and we believe that the Relationship Builder toolkit will play a major role in transitioning to being more user-centric and generally a more optimized process that allows for a strong relationship between the policyholder and the policy provider.
On June 3rd, 2021 the Redesigning Finance students presented their work via Zoom to a panel of experts working in the finance sector.
