I remember being perplexed by things like home, car and even medical insurance when I was a child. In my young mind, it seemed like an unnecessary gamble to pay for something you hoped to never need. With age and life experience I have come to understand it much better and to appreciate the peace of mind it brings. However, with this growing understanding comes an appreciation of how complex the insurance industry can be.
I recently heard an advertisement for an auto insurance company that accepts claims via text messaging. Clients can send pictures and other documentation of a fender bender, for instance, straight from their phone to the agency and receive a check that same day. My mind immediately went to the possibility that less scrupulous individuals could cheat this system, reminding me of how complex this industry is.
Like many other businesses, insurance providers have to deal with uncertain economic times, they face growing rules and regulations, and they have to adapt to new technological advances. Unlike many other businesses, they need to meet expectations about personalized product offerings, automation to speed up claims processing, and they need to use complex analytics to study present trends and make predictions about the future.
It is no wonder that a recent study by MRG found that taking an innovative approach to decision making predicts leadership effectiveness in this industry. Insurance industry leaders who have an experimental mindset and are comfortable trying new things and taking smart risks, are more likely to be seen are effective in their roles.
The decision to accept claims via text (as described above) was likely made by an executive with an experimental mindset. It is certainly a risk. Yet, if this executive also displays some of the other behaviors associated with effective leadership in the insurance industry, then the decision to take this risk was likely made from a place of expertise and forethought.
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