SugarCRM in Your Vertical Insurance Andrey Andreev

Global Technical Programs Manager

©2012 SugarCRM Inc. All rights reserved.

Vertical Solutions – The Learning Process

•  Understand the industry structure and vocabulary

•  Understand the industry dynamics

•  Understand the industry challenges

•  Understand the industry processes

•  Conceptualize and communicate the solution

Our Case – The Insurance Vertical

•  What is an insurance company?

•  How does it work?

•  What is going on in the marketplace?

•  What are the key challenges on the way of success?

•  How do we remove them with Sugar?

What is an insurance company?

•  A financial services provider, that aggregates similar but separate risks across a large number of individuals, and distributes the risk exposure using sophisticated mathematics

•  Charges premiums to collect the exposure share plus a margin

•  Invests the money collected

•  Indemnifies for claimed damages covered by a policy

How does it work? •  Develop products

–  Life –  Car –  Property and Casualty –  Liability –  Health –  Disability – …

•  Price them exactly •  Distribute •  Process claims & complaints

How does it work – Products & Distribution

Products

•  Siloed – carriers may be separated by law

•  Complex – seriously complex

•  Isolated – different processes, customers and channels

Distribution Channels •  Sales channels

–  Direct (e.g. online, over-the-phone) –  Captive agents (also called tied, exclusive, etc.) –  Independent agents/brokers –  Affinity-based (e.g. car dealerships, bancassurance)

•  Other players –  Insurance pools/syndicates –  Comparison portals

•  Common agency specifics – information hiding, regulation

The Insurance Dynamic (roadblocks included) •  Push for growth in a stagnant market

–  Even shrinking markets •  Commoditized product, pressure on margins

–  Save 15% or more by switching to… •  Active, demanding, empowered customers

–  Talking to some of the most conservative companies out there

•  Lack of customer trust, loyalty –  Average person has 5.2 policies, avg. carrier holds

less than two of those

Tackling those roadblocks •  Find new markets?

– Hard, but possible •  Decommoditize products? Price them better?

– Not really possible •  Better engage active (existing) customers?

– Good idea, sounds sensible enough! •  Treat customers with more transparency, service

them better? – Why not?

•  So, then, it is the customer we need to focus on

How might that work for X?

The strategic dilemma •  According to a study by the IBM Institute for Business

Value, 90% of all insurance CEOs picked getting closer to the customer as their most important strategic initiative in the next five years.

•  However: –  Insurances might never even talk directly to a

customer –  When it happens, information is fragmented, due to

the multi-channel, multi-equipment communication –  Agency complexity –  Information systems and processes revolve around

products, rather than customers

CRM is the solution! Some complications •  Agencies more often than not independent

–  Info does not usually flow upstream –  Competitors working in the same system –  It’s not just attitude, it’s the law

•  The data lives in ancient mission critical systems –  And you cannot touch it

•  Complex “customer” relationship –  Insurance owner, insured person, indemnitee

•  People don’t really talk to insurances that often –  At least not when they are in a good mood

MOTs? What MOTs?

Let’s see the demo

•  Germany based •  Founded 1820 •  Active in every insurance class •  3.5 million customers •  Revenue $5.2 billion •  System running out of IBM SCE in

Ehningen