Tropics Software Technologies, a company specializing in workers’ comp software products and solutions for self-insured groups and insurance carriers, is the subject of Louisiana Comp Blog’s first “Tech Trends” feature, in which we take a look at how technology is shaping the world of the modern workers’ comp industry. Trae Jones, Director of Sales and Marketing at the Sarasota, Florida-based company, and Jeremy Williams, Chief Operating Officer, sat down with Comp Blog to explain how the next generation of workers is set to transform how companies portray themselves to potential talent.
Comp Blog: Generations are often defined in a multiplicity of ways. Can you explain what the age range is for millennial workers and the characteristics you associate with that group?
Trae Jones: Based on my research, millennials were born between 1981 and 1996, so you’re looking at a current age range of 20 to about 35 years old. The reason that they are influencing tech strategy and will continue to influence it is because they are becoming today’s underwriters, policyholders, and soon, executives.
Obviously, you can’t paint the whole generation with one brush, but there’s no doubt that millennials are heavier users of technology because they grew up with it – there’s a comfort level that can be assumed. Also, this generation expects technological advancement. Plus, advancements in technology and the ubiquitous nature of mobile devices today have contributed to the perception that, when millennials want information, they expect instant gratification through technology, and they want it accessible on whatever device they have handy at the time, be that a PC, a tablet or a smartphone.
Jeremy Williams: Exactly, there’s an expectation that systems are going to be modern and that equipment is going to be streamlined in the workplace.
Comp Blog: There’s a lot of talk across the industry about attracting young talent and how difficult it has been for the insurance industry to present itself as a fulfilling arena. How does technology play into this issue?
Jeremy Williams: Human capital for the company itself and the majority of consumers are increasingly going to be millennials – so it becomes not just a marketing problem of attracting talent to the company, it hinders the industry’s ability to sell products effectively if we don’t have millennials driving the industry. The average age of an insurance professional is shooting up and we need to find solutions for when these people retire. Insurance is often seen by younger workers as a crotchety, old man business and this needs to change if the industry expects to compete for talent.
Trae Jones: There is also a real cost of attrition if a millennial employee is hired and then jumps ship because the working environment seems backward and lacking finesse. Technology aesthetics matter when you’re considering how an employee interacts with the piece of software that defines their work day in and day out. Millennials have an open-mindedness to technology as both working professionals and consumers, so we need to adjust for that as well. So, when we have millennials driving us in a more progressive direction, that opens the door for public-facing sides of the business applications to improve – like better portals for agents and policyholders to access their information and transaction capabilities quickly, easily and securely.
Jeremy Williams: Right. We live in the Google Age – you type something in and you get your answer. Modern insurance organizations need to get as close as they can to that level of responsiveness and invest in new, better-looking portals.
Comp Blog: Can you talk a little more about improving portals? What are the key factors?
Trae Jones: A good portal, in addition to an attractive design, is going to provide a lot of information and functionality. Submitting a first report of injury, online payments, new submissions, endorsements, allowing agents to see their book of business with the carrier in question – all of that should be available at your fingertips without having to wait on the phone. Responsive design [compatibility with mobile devices] is also another key component, since people want to access their information from anywhere.
Additionally, finding a technology company that invests heavily in ongoing research and development, instead of just sitting on one product as a cash cow for a decade is important when you’re shopping for a software vendor partner.
Comp Blog: One buzzword in the intersection between insurance and technology is predictive analytics. Can you give some insight into that?
Trae Jones: Essentially predictive analytics helps to analyze claims and underwriting data by aggregating it and developing an algorithm to assess risk on a per-policy (or per-claim) basis. For example, predictive analytics could be used to develop an underwriting scoring system by incorporating aggregated data and analyzing historical loss data. This data can then be coupled with automated underwriting rules logic in a manner that works like a traffic light – green is a good risk, yellow needs further investigation, red isn’t suitable. And that type of strategy can either be incorporated into the subjective work that an individual underwriter is doing when they work a submission, or it can be an automatic way to sort submissions and maximize efficiency. On the claims side it can help to set reserves, as well as to identify the likelihood of catastrophic claims based on the using the rules logic in conjunction with the large pools of claims data.
Jeremy Williams: It’s definitely a buzzword right now, and for good reason. If a comp program hasn’t implemented predictive analytics already, they probably are planning to in the next 12 to 24 months. Predictive analytics hasn’t reached the point of artificial intelligence yet, so the human underwriter and their experience is still really important, this technology just adds more precision to that decision-making process. At Tropics, we often work with third-party predictive analytics tools, so that we can integrate it into our core product, if the customer wants to have that feature and utilize it.
Comp Blog: What about smaller companies or those that don’t have large amounts of organized claims data. How does predictive analytics work for them?
Trae Jones: That’s the great thing about some of these new solutions. For predictive analytics to work you need huge data sets and, obviously, not everybody has that. Especially for small to mid-sized companies, that’s the beauty of the data aggregation. Predictive analytics tools often actually pull data from everyone participating in the system – this is called a consortium database – and it gives those small insurers access to a wealth of information. Based on what we’re seeing, if you trust the algorithm to do its job – the numbers are really impressive.
This begs the question: what happens when everyone has predictive analytics? At that point it erodes the competitive advantage, which is why we need young minds in this industry – to drive innovation.
Comp Blog: What is the most common reason that you find new clients moving to Tropics from another company?
Jeremy Williams: The most common reason clients select Tropics is the fact that we provide a specialized and comprehensive core insurance system designed specifically for workers’ compensation insurance processing. By solely focusing on this market niche for more than twenty years, Tropics has built and delivers a robust set of functionality designed to suit the needs of any insurer offering workers’ comp policies and/or claims processing.
Comp Blog: What do these carriers identify as their main needs?
Trae Jones: Today the market is demanding highly configurable solutions (as opposed to custom-built), integrated and intuitive self-service agent portals, robust data analyses capabilities, predictive analytics, data visualization options (in the form of Dashboards), and cloud-based deployment options.
Comp Blog: Anything you can share about what the next version of your system will look like?
Jeremy Williams: The next major release of Tropics Breeze will be made available in the late second quarter. This version continues to focus on enhancing core functionality with a market exclusive “Activity Center” which chronologically organizes and provides instant access to Notes, Tasks, and Emails within the scope of a Policyholder, Policy, Claims, or other key entity. Additionally there will be expanded capabilities in Reinsurance Management, Collections, Medical Case Management, and Self-Service Web Portals (for both Agents and Policyholders).
Image Credits: Tropics and Panorender