Great digital strides have been made, but connected insurance offers more.
It is now well-documented that the pandemic has accelerated organisational adoption of digital tools, tactics and techniques more rapidly than anyone could have forecast; 67 percent of organisations globally say they’ve accelerated their digital transformation strategy as a result of Covid (1). The insurance industry moved even more quickly, with 85 percent of insurance CEOs saying that the pandemic has accelerated the digitalisation of their operations and the creation of next-generation operating models: “COVID-19 has been the digital catalyst insurers so dearly needed.”(2)
Despite the achievements of the last year or two, now is not the time to rest on digital laurels. Momentum needs to continue, to keep up with customer expectations and competitive pressures. The bar has been raised, and it’s time for the connected insurer to meet the next set of challenges.
Although insurers responded to the areas of most urgent need, such as digitalising call centres and steps to address the claims process, fundamental flaws remain. As Deloitte report, “Many processes remain overly manual… are also not well integrated, [and] deficiencies lead to slower turnaround times, increased volume of errors and increasing backlogs of work that cannot easily be cleared.” Overall, they summarise, the “Legacy nature of much IT infrastructure can hinder agile responses to the crisis.”(3)
What More Can be Done?
Looking ahead, we believe that the insurance industry’s future focus should be summarised in one word: connection. Connected insurance is a phrase that is used increasingly often these days, seemingly meaning different things to different people. Jeffrey Williams of Forrester sums it up nicely: “Connected insurance provides a means for digitalising how your customers engage with you. It can also help you drive higher revenues, lower costs, and improve conversion. As insurers look for opportunities to innovate, connected insurance promises bespoke solutions that digitize customers’ buying journeys, from purchase decision to claims initiation. Furthermore, connected insurance can automate workflows like underwriting and claims handling.”(4)
KPMG identify eight key capabilities that a ‘connected enterprise’ must possess: responsive operations and supply chain, seamless interactions and commerce, experience centricity by design, digitally enabled technology architecture, aligned and empowered workforce, insight-driven strategies and actions, innovative products and services, and an integrated partner and alliance ecosystem (5).
Intelligent automation (IA) can play an important role in each of these capabilities. Below we highlight the top three areas that we believe are most important for the connected insurer.
- Responsive operations and supply chain. Allied with the ‘integrated partner and alliance ecosystem’ and ‘seamless interactions and commerce’ categories, this point is key for insurers living at the centre of a complex network of stakeholders. IA brings employees, service providers and customers together by automating workflows and improving communications. Automation for simple or standard claims delivers no-touch resolution, while streamlining other operations helps eliminate or reduce manual processes. As one article points out, “Increasing collaboration and speed allows insurers to innovate faster and chart a path to more wholesale, transformative changes in key areas, whether that be agent and broker channel automation, underwriting, or claims management.”(6)
- Digitally enabled technology architecture. While dependant on their core systems for business-critical operations, insurers are also hampered by them. These core systems can be cumbersome, slow to react to new requirements and hard to integrate. IA connects disparate IT systems by ‘wrapping’ them and enabling data access via integrations and open APIs to bring data, systems, and processes together. Low-code automation thus unifies existing systems without data migration, creating a single engagement layer across entire claims and other key processes. These low-code capabilities also facilitate the gradual replacement of legacy systems where required, by allowing functionality to be replaced over time as it is built into the digital platform.
- Insight-driven strategies and actions. Insights are derived by connecting data sources, from disparate legacy systems (see the point above) but also from new sources such as IoT devices, external databases etc. Combining data provides much greater value throughout the insurance life cycle – a single view of all data is essential to deliver a personalised, seamless experience; offer promotions and recommendations; and understand customers’ needs: in KPMG’s words, ‘experience centricity by design’. “This is a proven strategy to achieve customer centricity at scale, with clear applications to the claims process.”(7)
While the pandemic has proved that the insurance industry can move quickly to respond to change, many challenges remain. Becoming a connected enterprise is critical, and IA can play an important role in maintaining the momentum and meeting new demands. Back to Jeffrey Williams of Forrester: “The velocity of change in insurance is only going to increase. Insurers must create new products and services that improve customer and agent experiences, increase operating efficiency, reduce costs, and drive business growth. Connected insurance offers a way to meet these goals.”(8)
For a more in-depth discussion of insurance industry trends and how to address them with intelligent automation, please visit our insurance information hub and view our webinar recording.
3) Deloitte, ‘Impact of COVID 19 on the Insurance Sector’, 2020
5) KPMG International, ‘Going digital, faster-Global survey into the impact ofCOVID-19 on digital transformation’, 2021
7) EY, ‘Claims in a digital era: data, analytics and AI transform the customer experience’, 2017
About the Author
Managing Director, Australia and Co-founder
Dan Cooke is the Managing Director of Procensol Australia and one of the founding members of Procensol UK. Dan is responsible for managing the operations of the Procensol Australia office, including delivery of high profile consulting projects. Under Dan’s leadership, Procensol Australia has successfully established a strong presence in the Australian market, most notably with the award-winning “Connect” project for the Queensland Government’s Department of Environment and heritage Protection. (A project that has attracted attention from government departments nationwide and from the global Appian business). With 15 years of IT and BPM experience, Dan has led many enterprise improvement and digital transformation projects in both the UK and Australia.
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