This article originally published at InsNerds.com.
Tony started his career in insurance at the same place where most of our Millennials are starting theirs, in the call center. In his case, it was a Farm Bureau claims call center in their beautiful suburban campus in West Des Moines, Iowa. He didn’t know it at the time, but he got really lucky. That call center was very well run by enlightened leaders who realized they were training the future leaders of the company.
As early as the interview they told him that this call center was different than most. They understood that going forward most of the new talent coming into the company would start in this department, and they had been tasked with engaging and training those young professionals, so they would grow into being productive employees not only during but after their time in the call center.
They told him that they wanted him to spend two to three years in the call center, doing a great job, while at the same time learning as much as he could about the company and the insurance industry in general. After that he’d be expected to start applying for positions beyond the phones. The department also required each individual obtain their Associate in General Insurance (AINS) and their Associate in Claims (AIC) within their first two years. Failure to comply with the educational requirement could lead to termination.
The way the call center functioned on a day by day basis was also quite engaging. They were trained well and supported in their efforts to grow their career (even when it meant time away from the phones for a class). The call center answered all first notice of loss calls for both personal and commercial lines claims, so it was not overly specialized, there was lots of variety on the day-to-day work. Then, you would assign the more complex claims to claims specialists outside of the call center, and you’d get to keep the simple claims and work them to completion. This would allow the call center workers to be true claims adjusters and get solid claims experience in addition to answering incoming calls! This resulted in great customer service as roughly 40% of all calls would be answered by the person ultimately handling the claim, and it also resulted in lots of employee growth.
Even the way they measured your performance was not bad at all for a call center. While they did measure the amount of time you spent on “After Call Work” and “Unavailable,” it wasn’t the main thing they cared about. To the best of Tony’s knowledge, they didn’t measure the dreaded “Time on Call” that most call centers use as their main measure of productivity. The main thing that counted in this particular call center was the number of new claims you took and the percentage of those that you kept.
At the end of every week, management would send out a list of the top 10 reps that answered the most calls and kept the highest percentage of those calls. Tony was almost always in the top 2 for both categories, and he enjoyed the friendly competition. Since the list only included the top 10, not the bottom ones, people weren’t offended by it, it was a very positive thing. They also included in the weekly newsletter a congratulatory mention of everyone who had passed an insurance designation test.
While at times it could get hectic, the overall environment of the Express Claims call center was very supportive of employee growth and nobody seemed to hate the job. Looking back on it now, eight years later, most of the people Tony worked with in that call center are still in insurance, and none of them are still call center workers. Many stayed in claims. Many are still in the same company. Very few of them left the industry. That’s a successful insurance call center in our book! It was such a great place that Tony was sad to leave when he got an offer for a better claims position at Nationwide, which ended his call center days.
Sadly, we would find out as we met many other young insurance professionals, great insurance call centers that focus on developing their people are rare. Most are simply awful places to work, and while nobody seems to be keeping statistics publicly, anecdotally we have found twenty horror stories for every positive one.
There are many conferences about insurance, and none seem to be talking about our call centers. We go to a variety of insurance conferences each year, and we keep tabs of many more, and we have never seen a session about call centers. It’s almost as if those call centers didn’t exist! Or more likely, the leadership just doesn’t view them as really being insurance.
It’s like the call centers are the black sheep of the insurance family that nobody wants to talk about!
A huge portion of young insurance professionals in the 2010s started their insurance careers in a call center type environment. Most of them already had college degrees (and the associated student loans). Like previous generations, they fell into insurance by accident, but unlike previous generations, they won’t stay out of loyalty or out of having found great careers. If we do our job right and engage them in the industry, they’ll grow. If we don’t, they’ll leave the industry, and we’ll continue having a huge talent gap.
We’re not saying that we should close all the call centers and go back to doing business exclusively in the old fashioned way. We understand that our expense ratio will not allow us to do that in the age of price transparency and incredible competition for every insurance customer. What we are saying is that we need to realize that in many cases, the call center is our only touch-point with the customer, and we should be making them love their time “with us”. Maybe even more importantly, the call centers are our new entry level point for new talent, and given the talent crisis, our bad reputation with younger generations, and the high expense of replacing any employee, we need that talent to grow with us.
Based on the horror stories we’ve collected from conversations with fellow young insurance pros who survived some time in the call center and lived to tell the tale, here’s what many (but not all) of the insurance call centers are like to work in:
You have to be logged in to the phones every minute you are in the office and are not allowed to even be in the office outside of your work hours. There are rows after rows of grey cubicles, packed with unhappy 25 year olds with their college degree hanging precariously from the cubicle wall and the headset making a semi-permanent mark in their ear.
Engagement is so low, that it could better be measured in level of desperation. Turnover is high, with the great majority leaving not only the company but the industry and swearing they’ll never work in insurance again. The reps that haven’t quite given up on the industry yet are applying desperately to any open entry level position that’s not a call center. It doesn’t matter if its claims, underwriting, processing, or subrogation. Anything will do just to get off of the phones! There’s so many applying for the same jobs with essentially the same resume, college degree and one to two years of insurance call center experience, that’s it’s very hard to differentiate among them, so hiring managers mostly just reject them without an interview. Some have been told directly “we don’t hire from the call center”. The person that told us during an interview about a hiring manager telling him that exact line was actually very thankful for the honesty. He’s now an independent agent and very happy to have left the call center. We were lucky he stayed in the industry; most times we won’t be as lucky!
They are measured on 50+ different characteristics, so many that it’s impossible to actually focus on improving. Who can control that many different minor factors during each phone call? The most important measures tend to be Time-on-Call and Availability. The first one measures the length of their average call with the goal of keeping it as low as possible, and the second one measures the percentage of the time they’re available to take calls. In some extreme cases, even mandatory team meetings count against you the same as time spent in the restroom counts against you.
Performance evaluations are focused 100% on metrics and very little on your own growth or what you need to do to get out of the call center. Most of the supervisors are former call center reps themselves who only know the call center life. They often don’t know anything else about the company or the industry and can’t serve as good mentors even if they wanted to.
Professional development is encouraged by the company, but development time allowed by the department is very limited or completely non-existent, leaving it to the employee to do all growth activities outside of work hours. A case could be made that a motivated employee can grow by investing his own free time into activities like insurance designations, Toastmasters, and networking but most have no previous insurance experience and no advice on what they should be spending their time doing in order to grow with the company. The only thing they know is that they don’t want to be on the phones, and they don’t want to become call center supervisors either.
We have even heard stories of call center employees being denied support in getting their basic insurance designations because they’re not required for the call center job they’re doing. Some are denied even the ability to participate in activities such as Toastmasters or a young professional group because those meetings are in the office, and Human Resources doesn’t want them to be in the office outside of their work hours.
There are better ways to run a call center. Not only should others learn from the example of Farm Bureau Financial Service and their Express Claims call center, mentioned earlier, but there’s even more that we can learn from the best run call centers outside the industry.
We want to give you a guided tour of Zappos and what we think insurance companies should learn from them and the way they run their call centers.
Zappos was founded on the crazy idea of selling shoes online. Think about that one, shoes are the kind of thing that absolutely has to be tried in person, and when you go shoe shopping, chances are you try multiple shoes before you find a pair that fits just right. Zappos succeeded selling shoes online by doing two things differently: They’ll ship you as many shoes as you want, and then you can try them and keep the ones you want, returning the rest and Zappos will cover the shipping both ways.
The second thing Zappos does is provide amazing customer service. In order to provide that service, they run large call centers staffed by very happy employees. How do they keep call center employees happy? By doing things diametrically differently from most other call centers (including insurance call centers).
The hiring process consists of several interviews, and they’re mostly hiring for personality fit. The HR rep conducting the first interview is tasked with simply figuring out if this is a person they would want to work next to for 40 hours a week. Skills are much less important, skills can be taught. During the hiring process, they make it very clear that the great majority of positions at Zappos are at the call center, and if you take the job, you’ll be answering the phones for a long time.
Every new employee, regardless of position, must go through the call center training. You can be hired for a Vice President role and on day one you get to go to your new office to set your stuff down, and then you come back down to train for the call center with everybody else. After finishing training everyone gets to work the call center for a couple of weeks before going on to the job they were hired for. This guarantees that all the leadership knows what the call center is like. Currently, in insurance there are very few, if any, senior executives who came from the call center, partially because those call centers didn’t exist or were much smaller when those executives were starting their careers.
After their first couple of weeks on the phone full time, all new employees get called into a huddle room with their manager. The conversation includes giving the employee real feedback, both positive and constructive about their performance in the call center. Then the manager reminds them that most jobs at Zappos are at the call center level and that it’s hard to move to a different area. Finally, the manage says something like “Charlie, I’ve got a check in your name for $2,000. I want to pay you to quit. If you don’t love the job, take the money and we can part ways, no hard feelings.” They do such a good job in hiring, orientation and training that only 2% of people take the offer.
The way they measure performance is very different from other call centers too. They don’t measure Time-on-Call at all. All they care about is making the customer happy. That may mean ordering a pizza for a customer who is traveling and doesn’t know where to get a pizza from or chatting for 7 hours with a customer about which shoes to buy for her upcoming prom.
Zappos understands that happy employees lead to happy customers, and they also understand that in a world where your only interaction with the customer is when they visit your website or call your call center this is the only opportunity to connect with the customer. Zappos understands that a call center is NOT a cost center, it’s our ONLY touch-point with our customer. What could be more important than that?
The insurance industry has a lot to learn from the Zappos way. As Millennials become a bigger and bigger part of our customer base, and they are not fans of visiting an agent’s office, the call center becomes our only touchpoint with the 95% of our customers that didn’t have a claim in any given year. Also, if the majority of your new employees are starting at the call center level, it’s our only chance to get them to fall in love with the industry and to convince them to make a career here.
To learn more about the Zappos way we highly recommend the book Delivering Happiness by Tony Hsieh, the founder of Zappos. This amazing book will give you a great intro to how Zappos runs their business, especially their call centers. If you want to learn more they also provide guided tours of their offices in Las Vegas. They also provide training and consulting for other companies through their consulting arm Zappos Insights. You can learn more at https://www.zapposinsights.com/ .
We are strong believers that the first large carrier to figure out how to turn their call centers into Talent Mines will have a major competitive advantage in the talent wars. Combine that with Student Loan Aid and maybe with opportunities to take Sabbaticals every few years and you’ll create an unmatched employee experience that Millennials will not want to leave.