Standards Convergence Needed for Customer Satisfaction

It's a world in which insurance is converging with financial services, virtual companies are challenging traditional suppliers for market space, and agencies and brokerages are feeling the competition from new distribution channels.

"Ultimately," says Denise Garth, a member of the ACORD Life Standards Steering Committee, "it's about customer relations - how the customer chooses to interact with the carrier. The distribution channels compete for the customer; the customer chooses which channel to use for a specific need or product. So carriers must allow consumers to interact with them through any distribution channel - agency, broker, bank, broker/dealer, or direct."

The variety of available channels raises a new problem: how to avoid degenerating into a welter of different formats for e-communications. The industry needs to use consistent data standards for dealing with the customer regardless of the channel chosen, says Garth, vice president of information services at Mutual of Omaha Companies.

Standards allow a carrier to maintain and grow customer relations by offering the consumer a range of products through multiple distribution channels, Garth points out. A loyal, profitable customer may own multiple products over a lifetime - Personal and Business P/C policies, annuities, Life insurance, credit cards, and more. "It's all about customer loyalty," she says. "If you've got the customer's loyalty, you can enter their market space and sell them additional products to meet their insurance and financial services needs."

ACORD is taking a visible leadership role in standards convergence within the financial services industry, holding committee meetings to discuss ways of bringing standards together for survival and growth. The window of opportunity for convergence is short, and ACORD will move fast to collaborate with other standards associations. Work is underway to provide a "road map" of standards organizations and their efforts.

Priorities are mapping ACORD's XML for Life Insurance to the NAILBA standards so they can converge with ACORD; requesting IBM to map their Insurance Applications Architecture model to the ACORD standards; and identifying the gaps where standards need to be developed. Existing standards will be harmonized and ACORD standards will be modified where necessary; where other standards offer richer data sets, they will be adopted.