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Will any of Chubb Insurance’s Crowdsourced Ideas Fundamentally Change our Approach to Social Media Risk Management?



Social media insurance. Will any of Chubb Insurance’s Crowdsourced Ideas Fundamentally Change our Approach to Social Media Risk Management?

Chubb-socialmediaLast week, I announced the launch of Chubb Insurance’s crowdsourced innovation event. Even though this initiative still haven’t proved successful, I surely hope the Innovation team will meet its success criteria, whatever they are (please check my questions to Chubb at the end of this article).

I wish Jon Bidwell, Chief Innovation Officer of Chubb, and his team success not only because the industry urgently needs to better understand the risk and opportunity offered by social media, but because I can relate to the Innovation team: when I was senior innovation manager at Lloyds TSB, I experienced first-hand how challenging it is to launch such an initiative just internally. It surely took the team a lot of effort and a great deal of influence at the highest level of the organization to launch this initiative. Well done Jon!

Chubb recently commissioned two independent surveys on social media usage. Surveys are always a good way to generate some buzz, and prove a concept to your Senior Management. It surely helped Jon’s team to launch his innovation event.

Back in February, Chubb sponsored an independent survey about contribution on social media sites.

Survey 1 – The survey results show that while some people are being cautious about putting personal information online, many are unaware of the liability exposures associated with posting comments to blogs or other Internet sites.

Please find below some findings from this survey of 1,000 Americans:
* Respondents Are Cautious About Online Profiles, Less So About Blog Postings
* 27% have posted a comment on a news site or blog.
* 60% rarely or never obtain permission to cut and paste articles, other information or artwork from copyrighted websites before emailing them or printing them out and distributing them to others
* 2% of respondents said they have lawyers review comments before posting them to their blogs

Survey 2 – Last month, Chubb sponsored another independent surveyon personal identity on social media sites.
The results show that only 51% of the people surveyed always use their real name on social networking sites.

Please find below some findings from this survey of 1,000 Americans:
* 66% would not use mobile technology that shows people on social networking sites where they are located
* 20% have shared a negative product or service experience
* 64% said their company had no policy for talking about the company on social networking sites
* Of the 36% who said their company had a policy, 18% said they were encouraged to talk about the company and 18% said they were prohibited from talking about the company

Stats from Chubb’s Crowdsourced Innovation Event
As risk management professionals, our challenge to you is to identify emerging risks associated with social media, scenarios where it will have the greatest impact and how to begin the mitigation process. In doing so openly with your colleagues worldwide, your ideas will help define and shape the future dialogue around this important new risk.

Please find below some stats following the event which took place between 26-29 April:
* 39 ideas submitted
* 155 votes
* top categories: Reputation (34 ideas), Brand (26 ideas), Proprietary Information (11 ideas)

“Top 5” Ideas (01 May 2010)
So do you wonder, just like me, how innovative those ideas are? Will any of the 98 ideas provide the Finance industry with the answer to social media risk?
Let’s have a look at the current top 5 ideas.

1. Inverse Case Study – company policy protects the employee by Robin W Spencer
Categories: Customer Privacy

Description: Personally, the rare-but-mortal nature of this risk suggests to me that it’s appropriate for the company to sever overt connections between its people as employees vs as private individuals. In this case that could mean not allowing them to log in to social sites with their address, and/or to coach them not to engage any extreme or ranting sites in a way (name, address, etc) that could make them a target of extremists. This isn’t as draconian as it may seem: companies usually have media contact policies and this is an extrapolation of that.

More and more companies are working on not one but two types of social media guidelines / policy: one for their employees at work, one of their employees at home. It is important to educate your employees and make them realize the implication of engaging in potentially sensitive discussions on behalf of your brand. Most of the time people genuinely don’t appreciate the reach of social media and the potential impact of their comments on their employer’s brand. This is also true for angry customers which often regret leaving intense comments online.

2. Restraining Risk With an Arrow in our Quiver by Logan B Sohn
Categories: Reputation; Reduce Litigation/Dispute Resolution Costs

Description: Insurance companies should begin offering policies with coverage for claims that a company may incur as a result of actions through Social Marketing. This would suppress some of the risk taken by companies that are “green” to this technology, which would increase the amount of users, as well as open a new area of competition within the insurance industry.

Why not I suppose, it could be a new business opportunity for insurance firms. Nevertheless, I strongly believe in the importance of educating your workforce and putting in place the right processes and guidelines, especially for your employees who officially contribute on social media sites on behalf of your company: PR, customer support representatives, contributors on corporate blogs. At the same time, financial institutions must remember that the level of risk is highly dependent on the type of social media activity. You must manage the risk but at the same time, you want to increase both employee and customer advocacy.

3. Social Media Response Team by Sara Husk
Categories: Brand; Reputation

Decription: Create social attack response teams / processes and offer them as active “insurance” to reduce financial impact & brand damage. Could almost be modeled off of a claims CAT response team.

This touches the topics of reputation monitoring and influencer outreach strategy. First of all, financial institutions have to start listening and monitoring online discussions about their brand, their products, their competitors and their industry. Then, they will have to assess the level of influence of the contributors to prioritize their response effort. The holy Grail would be to emulate a super champion of social media like Dell which actively listens and makes sure to respond to pretty much every good and bad comments about their brand online.

Very few financial companies have designed and implemented a proper outreach strategy. Bank of America and Wells Fargo are doing a great job on twitter, and Citi plans to implement a thorough, industry leading, outreach strategy before the end of the year. Stay tuned.

4. Variety of Risk Mitigation Tactics by Robin W Spencer
Categories: Brand; Reputation

Description: As a facilitator of a large corporate collaboration site, I used a number of methods to manage risks of bad behavior on a website. None is perfect, but especially when used in combination they are very powerful. Here are a number of ways to mitigate online risk: identity, complexity & effort, human moderation, computer filtering.

The power of the few, and the level of authority of a brand most extreme and passionate contributors, is a real challenge for companies. Putting in place the appropriate guidelines, community rules, and having a transparent moderation process, are good ways to deal with off-topic comments and rants. Ideally, your goal is to know who your contributors are, and share enough information about them with the rest of your community to make the comments as relevant and contextual as possible.

5. Personal Life Posting vs. Employment Discovery by Anthony Rodriguez
Categories: Reputation; Customer Privacy

Description: Not sure on how to mitigate this risk as everyone and/or anyone may have access to information posted. I am not a current user of any of these services but have heard many horror stories which have resulted due to a posting which was revealed / discovered.

This is one of the most sensitive topics: monitoring social media activity from your employees outside work (as well as your clients’). There is not definite answer, but it is growing source of concern for social media users. As stated in the Socialnomics video: “what happened in Vegas stay in… twitter, youtube, Facebook…”

Last November, Manu Life decided to cut off the allowance to a depressed 29-years old canadian woman because she seemed happy and in good health on recently uploaded pictures on facebook. Do you really think insurance companies will somehow manage to increase their insurance premium up to 10% for the social media users active on sites such as twitter or facebook?

So how successful is this Chubb initiative? I guess we will have to wait until May 14 to really measure the level of contribution and engagement the initiative generated.

My Take & my Questions to the Innovation Team
Launching such a crowdsourced event was a brilliant idea. As usual, the challenge is to first to drive registration, then to sustain a decent level of activity on the platform.

From my opinion, the two main issues are: not providing enough info on the contributors (who are they from? What is their level of authority and expertise?), and not leveraging social media to spread the word and keep the world posted on any new activity on the platform.

I believe Chubb should also change the ranking system which doesn’t reward the most debated ideas.

Overall, risk professionals are not big social media users, and asking them to contribute to such an initiative on such a platform could prove difficult. I expect most of them would be reluctant to share ideas online, and I believe the reward is not strong enough. Give the top contributors more visibility and find the best way to urge them to invite their contacts to partcipate and contribute.

Finally, it is great to capture so many ideas but what’s next? I wonder what Chubb will make of that valuable input. Will they create and chair an international task force with participants from the industry whose goal would be to implement the best ideas?
I am curious to find out how many people registered before the event, and at the Risk & Insurance Management Society annual conference. I had a chat with the team on twitter, they confirmed they had kiosks on-site: “we have Mac stations for people to register for our event and participate!”

So, how will the Innovation be judged? What are their success criteria?

I plan to get some answers during the interview I am currently putting together with Chubb. Stay tuned on the Visible Banking blog, and the@Visible_Banking twitter account!

What do you think?

Written by Christophe Langlois

Based in London for almost a decade, Christophe is an entertaining fintech marketing keynote speaker and a trusted advisor to the global financial services industry on the topics of digital marketing, innovation and B2B social media.

Christophe has contributed to over 140 events in 18 countries.

Currently, Christophe is advising a number of fintech startups on marketing and growth hacking and he is the Chief Marketing Officer of The Fintech Power 50, an exclusive annual programme helping fintech scale-ups to accelerate their growth globally.

Christophe's views on are his own.

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