Page 264 - Performance Leadership

Chapter 13 The Insurance Performance Network • 253

service providers—its “channels.” The performance indicators for the
three different types of relationships are listed. In added-value or joint-
value relationships, managing the transactional elements of the rela-
tionship is still important. The stakeholder contributions and
requirements are based on the performance prism methodology dis-
cussed in Chapter 12.

Managing Transactional Relationships
Insurers cannot rely on their traditional performance indicators. Even
within transactional relationships, reciprocal metrics are important. An
insurance company’s set of measures to see what it adds to its channel
partner’s requirements is mostly process oriented. It needs to have a
short average time for critical processes such as underwriting new poli-
cies, renewals, and claims, as these are primary drivers for customer sat-
isfaction within the insurance industry. A claim that is accepted after
six months will still lead to low customer satisfaction; it places the chan-
nel partner in a defensive position too. At the same time, a rejected
claim that is processed really quickly has a limited effect on customer
satisfaction.
Not only do these processes need to be efficient, they also need to
be of high quality. The insurer should have metrics in place to track
data quality and the percentage of transactions that are completed with-
out any rework. From a marketing point of view, it is wise to compare
policy premiums with the competition and track this. In a price-
sensitive business such as insurance, and within transactional rela-
tionships that have low switching costs, it is easy to switch to a different
insurance company. Lastly, to make sure it is easy to do business with
the insurance company, the different ways to communicate with its
channel, such as the call center, the Web, and its account managers
should be easily available.
In addition, there should be some transparency between the insur-
ance company and its channel partners. In transactional relationships
information exchange is fairly operational. It consists of limited cus-
tomer information, because the intermediary owns the customer data;
the status information on claims, policies, and renewals; and straight-
forward management information on intermediary commissions.
Although steering on commissions is enough for the revenue side of