1. 2 8 BA 590 Guest Speaker John Jolliff  “Inside” development of Service- Oriented Products  Presentation (20-30 minutes)  Q & A Session (45-60 Minutes)

2. 2 8 The Delta Center Devils (Grand Ledge, Michigan Little League Champs 1968)

3. 2 8 John Jolliff Presentation Overview Background COUNTRY Insurance & Financial Services Identifying Customer’s Needs Testing and Screening Regulation/Laws Environmental Implementation/Launch Best Skills Q & A

4. 2 8 John Jolliff Background OSU Grad – Business Major Three different companies during career  Positions in insurance industry Claims Research Underwriting (bulk of career) Agency and Operations

5. 2 8 COUNTRY Financial Overview Providing Financial Security…  Property/Casualty  Life/Disability  Mutual Funds/Investments/Managed Accounts Our Stats (Size/Companies)  $2 billion in P/C premium (company)  607 in Fortune 1000  Top 10 low net cost life company  Operate directly or indirectly in 40+ states Our Region  $330 million in P/C premium  Six states (OR, WA, NV, AZ, AK, ID)

6. 2 8 Identifying Customer Needs Product Service Distribution  Number of agents  Location of agents Internal Sources of information  Agents  Customers  Employees Underwriters/Claims Adjusters External Sources of information  Focus Groups  Competitor offerings  Industry publications  Demographic/Census data

7. 2 8 Identifying Customer Needs Examples - Product  Identity Theft  College Graduate Discount  Special Tenant Endorsement  Long Term Care Rider on Life Policy

8. 2 8 Identifying Customer Needs Examples - Service  Customer Service Center 24x7  Billing Call Center  COUNTRY Helpline  Credit card payment option

9. 2 8 Identifying Customer Needs Examples - Distribution  Now entering Idaho

10. 2 8 Concept Testing and Screening Product and/or Service How Do We Know That it is Going to Work? For product and/or service, often –WE DON’T!!! We discuss primarily with agents  National Advisory Group  Front line sales-contact with customers Seek feedback from employees Evaluate competitive offerings

11. 2 8 Concept Testing and Screening Product and/or Service How Do We Test It? Generally, we will pilot a concept  Smaller local area or state-by-state  Measure and monitor results  Work out any bugs  Enhance or expand offering  Full rollout

12. 2 8 Concept Testing and Screening Product and/or Service What Are Our Biggest Challenges? Insurance is viewed as a commodity  Many coverages are mandated  Hard to differentiate on product Speed to market ITS time to develop Antiquated legacy systems Consensus driven organization

13. 2 8 Concept Testing and Screening Distribution Where do we add more agents or Where do we add new locations?  Much larger decision for us  Multi-line exclusive agents  Heavy financing costs  Vested interest in agent success

14. 2 8 Concept Testing and Screening Distribution Challenges to adding agents or agencies  Existing competitive market  Loss experience in area (if already there)  Hiring quality agents  Size and type of demographics  Location  Availability of leads

15. 2 8 Challenges Due to Regulation/Laws Insurance/Financial is Different because… Heavily regulated industry All products and rates must be approved by state “Adequate, not excessive and not unfairly discriminatory” is the criteria Market conduct examinations Notification to customers (FCRA) Legislative or Statutory changes Occasional ballot initiatives  Prop 42 to ban used of credit-based insurance scores

16. 2 8 Environmental Issues Very competitive market Competing with much larger players  Resource disadvantage How Do We Deal with Change?  Investigate, evaluate and react  “Fast followers” rather than “bleeding edge” How Do We Get Info on Change?  Industry publications  Agents, Customers, Employees, Other external sources  State Department of Insurance

17. 2 8 Implementing and Launch How Do We Train  Internal training resources  Training for all who need it Employees Agents, etc.

18. 2 8 Implementing and Launch How Do We Get the Message Out…  In Our Company Internal website eMail Company meetings  Outside Our Company Advertising/Brochures/Press Releases Materials sent to customers with billings Agents/Employees

19. 2 8 Implementing and Launch Challenges in Implementation?  Did we hit the mark?  Getting agents excited about opportunity So many things to know and remember  Measuring and monitoring  Making changes

20. 2 8 Implementing and Launch Best Launch and Why?  Customer Service Center 24x7 Met customer and agent needs Well tested Revised as necessary Responsive

21. 2 8 Implementing and Launch Worst Launch and Why?  Special Tenant endorsement Not understood by agents or customers Met a narrow market need No incentives for agents

22. 2 8 Best Skills for New Product Success What Employees Need to Have…  Know your business  Know your customers  Know and anticipate needs  Be creative  Act and react quickly  Be willing to abandon mistakes

23. Questions?