MetLife exec on getting the culture right

  • By Christine St Anne

As head of MetLife’s Australian business, Deanne Stewart is a big believer in delivering for both the business and customers but reveals it is not an easy balance to achieve. Christine St Anne reports

In a previous job, Deanne Stewart was confronted with an ethical conundrum. Walking into her CEO’s office, she wanted to discuss an issue that would achieve a better outcome for the company’s members. The solution, however, would have a short-term impact on the business. She was taken aback from the response: “Deanne, first and foremost, we are not here for the members. You are here to do the right thing by our shareholders”.

“Who was I to argue with the boss of the company, but it generally felt wrong.” For Stewart, the experience spurred her to think that it was time to take on a leadership role that would create the right environment for both members and shareholders.

As CEO of MetLife, she acknowledges it’s not an easy balance to achieve. “I do believe the majority of people in the industry are here for the right reasons with the right mindset. Sometimes there is a disconnect. Leadership also sets the tone for the organisation. To be there when the hard decisions need to be made and to remain on the side of your customers and members.”

The crucial component to life insurance is of course claims management. “There is no doubt from an insurance perspective that your moment of truth is in claims and this begins with getting the culture right.” She outlined five key functions in supporting good culture in insurance including philosophy, policies, processes, incentives and leadership.

According to Stewart, the insurer’s philosophy should be aligned with its stakeholders as it is philosophy that “acts as the guard rails for the organisation.”

It’s a philosophy that challenged the team at MetLife, during a tender process with a superannuation fund. The key objective in that tender process was to reduce claims, and it was an objective that did not sit well with Stewart and her team. “We decided not to go into that tender because clearly our philosophy was not aligned with that fund and that drove us to act.”

She acknowledges that while “you can have a short-term win” by processing claims that are “legally declinable”, ultimately “it will come back to bite you”.

Twists and turns

Steering the global insurer for over three years now, Stewart and her team have been doing a lot of work around claims culture and looking at the intent of the policy. For Stewart, the very nature of life can throw up all sorts of challenges when it comes to claims processing.

“Life comes with twists and turns. It can be messy. But we are in the business of protecting lives and we need to realise that no one claim is the same because of this complexity of life. That is why culture is so important and acting in good faith goes to the heart of culture.” Stewart highlighted one case which was a “doozer”.

A claim was made for income protection by a member who was in a serious car accident. With a history of post traumatic stress (which wasn’t disclosed in the policy application), this person was also convicted and sent to gaol. Ultimately MetLife still paid out the claim because “as abhorrent was the crime it had nothing to do with the claim”.

Another claimant was a man who was unable to continue working in his hospitality job due to an injured arm. His family depended on his wage so the situation was rather precarious. However, while the claim couldn’t be paid out as a TPD claim, his case manager realised he had income protection.

“We were able to pay his claim and importantly help him get on with his life”.

There is no doubt from an insurance perspective that your moment of truth is in claims and this begins with getting the culture right

As part of the work on fixing up its claims management, the group went through its claims processing to ensure clear working policies and definitions. MetLife also overhauled its TPD processes. Over the last 18 months, the insurer has cut the claims processing time in half. In addition to its claims panel of case managers, a second panel of senior executive was established to tackle the more difficult claims decisions.

Finally, the group insurer also revisited its rewards policies to ensure claims successes were linked to quality, compassion and efficacy. “Some companies are still using scorecards that are linked to claims paid or declined. You can’t have rewards linked to that type of outcome.”

While Stewart acknowledged the importance of a whistleblower policy, she is a firm believer that a supportive culture that respects and supports its staff to speak up is just as crucial. And here leadership again plays an important role.

“It’s also important that leaders create a safe environment that supports good culture and ethical practices. A safe working environment that allows people to speak up is better than having a whistleblower philosophy," she added.

MetLife has embarked on an awareness campaign around the importance of insurance inside superannuation. The campaign included buy-in from its superannuation fund clients to create a “true partnership to raise awareness”.

The decision to lead on this issue was partly based on some research undertaken by MetLife which revealed an awareness gap. The group spoke with many claimants who were not aware they had insurance until either a friend, a work colleague or a financial adviser told them. Importantly insurance provided through superannuation funds gives necessary cover to people in high-risk jobs such as construction workers.

“In all honestly, it almost suited the industry in the past to not necessarily promote the fact that insurance was provided within superannuation. But times have changed and it is important that working Australians realise they do have this benefit.”

Stewart also adds that it is not widely recognised that group insurance is a social good, “reducing costs by hundreds of millions of dollars every year that would otherwise have to be drawn from the public purse.”

In fact, statistics from the Australian Prudential Regulation Authority last year revealed that insurers paid out $8.6 billion in claims, taking pressure off the social security system for Australians dealing with difficult situations such as injuries sustained in a major accident or treatment of cancer.

Harnessing technology

Stewart has seen the insurance sector evolve to embrace innovation. Technologies such as wearables are changing the way insures do business but Stewart urged caution with such initiatives.

“Insurance has changed from being there for simply a financial benefit, to helping people in their hour of need through early intervention and rehabilitation. Now it is about prevention. The industry has embraced wearables as an effective prevention strategy but it is important that it does not evolve into simply a marketing gimmick, rather than genuinely helping people and protecting them.”

This is not to say that MetLife is not focusing on prevention. In fact it is “doing a lot in this space” particularly around resilience given its presence in group insurance.

“When we unpeeled our claims management, we found that 20 per cent of claims were mental-health-related. We are looking at ways to help people become more resilient at work and in the community through digital tools or through partnering with providers to provide workplace mindfulness programs," Stewart explained.

Insurtech is also another initiative adopted by MetLife through its LumenLab in Singapore. Set up in mid 2015, the aim of the centre is to boost innovation in the insurance sector. “It is the biggest innovation lab in Asia. We also have a locally-based innovation team but our partnership with LumenLab will also provide us with benefits around the preventative health space.”

Among the initiatives is a diagnosis tool that can detect an early onset of dementia. New capabilities in digital health technologies allows data to closely monitor the disease’s progress and measure the impact of intervention programs. “While we are leading on mental health in Australia, our other offices around the world are leading on dementia and cancer issues but we will all benefit from research and innovation.”

Despite the technological changes, Stewart believes that the business of insurance ultimately goes back to looking after people and its MetLife’s commitment to people that spurred her to join the company.

“I wanted to run a company where you make the environment special and connected for people. A business with a clear purpose. MetLife ticked all the boxes. Next year, the business will be 150 years old. For 135 years, it was a mutual. This makes it a values-led company. Doing the right thing by its customers, business and partners is deeply engaged in MetLife’s DNA.”