Not Your Grandfather’s Insurance Company

An old industry adapting to the digital age

Insurance, something that we all need, but never want to pay for. It’s a product that we never really think about, until times gets tough and life happens. Most insurers will highlight the fact that you’re paying for the peace of mind, the relief of knowing that when disaster hits you have a safety net. An industry that dates back to the 1700s, a product that wasn’t just a fad. Insurance companies have a historic reputation of being a boring, stuffy, risk averse, and quiet simply an old man’s board room.

All of this is or once was true, but as the world around us changes insurance companies have had to understand the new types of risks society and businesses can face. The industry is quickly changing and adapting. I can tell you when I was first recruited by Liberty Mutual during my undergrad years the recruiter actually said to me “insurance is sexy.” While I wouldn’t go that far, I can tell you even in my 3 short years here I have seen multiple transformations take place, all driven or enabled in technology or digital disruption. I should preface this by saying, yes I work at Liberty Mutual as a member of their Human Resources team. So before you begin to ask me questions “How do I lower my premium?” and “What are your latest predictions on CAT loss this year?” I can say I leave those type of questions to the expert talent which I hope we employ and develop.

Liberty Mutual has is a company that has been in business for over 100 years. It was a company which started specializing in workers compensation, and has quickly grown into a fortune 100. Today Liberty has global reach and is quickly climbing the ranks as a competitive property and casualty insurer. Today, the company’s drive towards innovation has helped not only recreate the way in which we approach the concept of insurance, but has aim to create a cultural workplace shift towards test and learn.

A few years back our IT teams began to start a journey away from Waterfall methodology to Agile methodology. In the simplest terms, waterfall methodology is a way of working which is highly process driven and focused on the final outcome, whereas agile approach is rapid and iterative. While waterfall focuses on building a final product, agile focuses on constant delivery and improvement. What sounds like a simple switch for software developers, further challenged every area of the business to re-think the way we worked and the way in which we provided products and services to our customer, whoever that may be.

Agile was just the beginning. As a once recruiter for Liberty, I had the pleasure of attracting talent on this new journey. Liberty worked to create an environment that combined agile methodology and design thinking to redesign the customer experience. Our business leaders understood that other insurer carriers were no long our only competition, we are competing against any and all companies known for having an amazing digital and online experience buying products. In order to stay sharp I had a hand in helping to build out the talent for our customer centric agile design teams. These teams brought together talented technologists and developers practicing agile methodology with creative, user experience experts who brought design thinking practices to create something transformative.

I will admit it was a difficult endeavor to break through the formal reputation which Liberty Mutual has always maintained, but through this journey the company transformed itself.

  • Our digital transformation teams worked in start-up like environments in co-located spaces, some even within WeWork.
  • Our teams were getting even closer to the customer through real time customer feedback loops and making digital upgrades and changes directly after engagement
  • Removing deadlines, and focusing more on making the life better for the customer

These are just a few of the ways in which the Liberty help to set these teams up for success. Small squads were built with a combination of IT talent, business knowledge, and UX experience. Each team worked around one customer journey to improve the life of the customer, we called these digital platform journeys. One of the pioneer and most success journeys was called “I Buy Motorcycle.” This platform team redesigned the online customer experience of purchasing motorcycle insurance online. The team was able to deliver a minimum viable product to the market in 28 days. By getting closer to the customer, as well as understanding the digital experience transformed the sale of this insurance product and allowed for future improvement and development. This is just one experience of a journey team, the easiest way that I would explain the way we think to candidates was this:

Picture yourself as a customer, you just have just won the lottery and find yourself with a lot more wealth. With that new found wealth you decide to quit your job and buy a yacht. You are sitting on the yacht with a nice cool glass of wine in your hand enjoying the beautiful Mediterranean sun shining down. Now, before you leave that slip how am I (Liberty Mutual) going to have you purchase and fully insure your new yacht without ever having to put down that glass of wine…?

The agile and design thinking culture used by our business has further ingrained itself into all areas of the LMI, even those not part of our digital transformation teams. Who would have known that change in our online presence would challenge the way we think as an enterprise? I have seen a culture shift in the way we work, we value innovation and thrive on customer feedback made to improve our end products and services. I can honestly say that Liberty Mutual Insurance is not just your grandfather’s insurance company anymore…

See for yourself …

8 comments

  1. Great post Matthew! After my experience interning with Deloitte Tech Consulting this past summer, I was really curious to see how some business were using agile methodologies. It’s interesting to hear how a company in a typically slow moving, heavily regulated, industry has adapted with the new technologies. I’m curious just how much of a competitive edge agile methodologies have really given to Liberty Mutual over its competitors! Agile methodology is huge on the tech side as you discovered, but I’m really interested to see how business leverage them on the strategy side as well. There are so many applications. Imagine a CEO decides “Hey we need to work more on growing our business by writing more policies, increasing premiums, and selling more add ons” then each agile strategy team could work on defining user stories and executing them, each working towards the common goal of growing the business. After all, the only way to eat an elephant is one bite at a time!

  2. This is a fascinating topic that affects everyone. Thank you for your insights into Liberty Mutual! As you mentioned, insurance has been around for years and, like the healthcare industry (hospitals, pharmaceutical companies etc.), it has been more conservative and hesitant to adopt new technologies. I have recently read a lot of articles about insurance companies’ digital transformations and removal of legacy systems. For example, a couple months ago health insurance company Anthem of Blue Cross Blue Shield hired Udi Manber, the former search head at Google, to lead their AI division. It is exciting to see Liberty making the transition as well. The implementation of agile is extremely difficult and requires a lot of change management at such a large scale, especially with professionals who have been using waterfall for years. It will be extremely interesting to see how Liberty and other insurance companies respond, as more innovative technologies are developed. For example, how will they insure driverless cars? Would you insure the driver, the car itself, or would the manufacturer be responsible for driving errors?

  3. This was such an interesting behind-the-scenes look at what most people consider to be an old standby industry. For me, your post brought up what I think is a particularly intriguing debate – can we (and should we) keep sectors separate from one another in the face of rapid technological change? If every company can effectively be called a tech company, is it fair to expect companies that don’t have tech at their core to compete with tech-native businesses? The successful digital transformation of Liberty Mutual seems to suggest that it is a fair expectation, or at least a manageable one. That said, I wonder if such a transformation is plausible across the industry or if there are certain endogenous factors that have to exist for digital transformation to take root- do you think your company’s competitors would be as successful in implementing a similar digital strategy, or are do you see elements unique to Liberty Mutual that made this possible?

  4. Great post! I really like the anecdote you provided about a newfound millionaire and their yacht trip. I think it is really interesting that a company selling something as necessary and routine as insurance finds ways to keep their customers excited and engaged. Everyone buys insurance, Liberty Mutual may never have to worry about losing a customer base for this reason alone. However, their commitment to innovation shows a strong value for customer care that really enhances the brand and propels it among some of the other insurance powerhouses. It will be very interesting to see how Liberty Mutual approaches AI and device integration in the future as new technologies reorder the components of policies and introduce the possibility of new coverage options. I really enjoyed the insights you provided to this thought in the embedded video!

  5. First, thank you for sharing! It was really interesting to see a sort of larger picture of Liberty Mutual’s transition from an HR perspective. I actually worked as a scrum master/business analyst on an agile team in the healthcare tech space, and I always find the different applications of the methodology to other industries so interesting. To me it always seemed so clear that it was a superior way to develop products/services, but I’ve come to realize that for traditional industries/firms, it’s a completely mindset shift and an adjustment that doesn’t always come easy. It’s tough to approach a minimum viable product with the understanding that it’s not “complete”, but iterating and gaining continual feedback from stakeholders always seems to create a better finished product. It really does have to be a change at the core of the business and it’s great to see that industries outside of the traditional tech-space, like liberty mutual, are starting to embrace it. Have there been any tangible metrics to see if the adoption of these agile ideas have resulted in any improvement? It’s great to hear that you are already seeing benefits in the way people work and the enterprise vales in general. I’m interested to see if others see the changes Liberty Mutual is making and follows suit, it’s clear they’re headed in the right direction!

  6. Interesting to read about the waterfall effect, which is overlapping with my data analytics II course. It’s crucial for these older/ larger companies to adapt towards the agile movement to keep up with technological advances and survive. My company too has had a major push towards agile and creating “centers of excellence” in order to technologically advance to stay ahead of smaller start-ups and new trends in investing.

  7. This was a great share on how a “traditional” company is looking to innovate with application of technology and reviewing it’s process management. I work in higher ed marketing and resistance to change, especially around new (and sometimes not so new) technologies, is an issue that comes up often. But I would say we’re working slowly on moving in the right direction, we’re thinking more about some of the areas you’ve brought up: the user journey, how internal teams can continuously improve processes to respond to prospective students and alumni.

    I do feel though that changes like these need to be embraced and promoted from the top as well. It’s great to see the investment in resources and working spaces to foster this type of work between teams.

  8. It’s so great that Liberty is addressing the issue. This is a classic Innovator’s Dilemma problem and they’re definitely trying to maintain their innovation. With all the disruption going on in traditional industries it’s good to see a company try to “disrupt” itself and change tactics after 100 years of business.

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