Technology is evolving fast and many insurance organizations are challenged to keep up the pace. The top priority of an insurance company today is profitable & sustainable growth and to enable this, leading insurance carriers are taking all possible measures to deploy innovative practices & latest technology for improving the business processes and streamlining legacy applications.
“Digital Natives” is and will continue to dominate the workplace, which has huge implications for agents and brokers looking to engage with customers and grow their businesses. As the millennial generation matures and enters its peak, buying power, digital and more-automated ways of doing business will become a fundamental part of day-to-day workflows.
From the rise of mobile users and cloud-based technology to social media interaction, a Deloitte study on 2016 tech trends for insurance agents explains that insurance agents are finally realizing the need to be more nimble, efficient and accessible to serve today’s customer.
To add to this, there is a challenging regulatory environment that continues to add more regulation to streamline the insurance sector. A recent Deloitte report outlines that such regulations are no longer one between state and federal entities, but a hybrid of U.S. and state government regulation of insurance entities to ensure efficiency and adherence to state and federal standard procedures.
As a result, insurance agents not only feel pressured to digitize their workflow, but also must streamline business processes to make the cost of doing business more efficient and in-line with these regulations.
While 63% of insurance businesses report that they are ready to move towards more digital practices, only 23% of these businesses are ready, reports a joint Forrester and Accenture study.
To accelerate this process and ensure successful transition to digital workflows, there are a few key trends insurers are and should be embracing.
Modernizing legacy systems for operational efficiencies – With operations spread across geographies, spanning over decades, insurance companies are inhibited with legacy systems, outdated technologies resulting in high maintenance costs. The proliferation of modern technologies like mobile and cloud computing has changed the way organizations do business. Rather than being left behind, it’s time for insurance companies to embrace the latest technologies, and modernize their legacy platforms for operational efficiencies while considering the flexibility of consumers.
Embracing a cloud-based and on-premise infrastructure – IT teams in the insurance sector struggled with what information is allowed by regulators to be stored on cloud vs. on-premise. Many insurance entities are running off 40-year old administration technology designed to manage the claims process, says a recent TrustMarque report, which is hindering innovation. Also, insurance agents are far from instantaneously replacing such mainframe technology.
As the insurance sector adopts a more streamlined workflow, we can expect a significant increase in the use of technology that can be operated via hybrid cloud and on-premise, ensuring ultimate flexibility for customers and clients and strong adherence to the ever-changing government regulations within the insurance environment.
Artificial Intelligence – Artificial Intelligence (AI) is helping insurance companies develop systems that can perform tasks that previously required human intelligence and manual processing. With the advent of AI in the insurance industry, insurance agents can now count on sophisticated systems for precision, efficiency, and flawless automation of existing customer-facing, underwriting and claims processes. In coming days, Artificial Intelligence will be more disruptive and will be used to identify and assess emerging risks.
Blockchain – The insurance sector is also focusing on Blockchain technology to empower the future. Through its distributed ledger, smart contracts and non-repudiation capabilities it can act as a shared infrastructure that can transform multiple processes across the insurance value chain. Not only will it simplify paper work and improve auditability, besides helping the insurance industry to cut expenses significantly. It will also reduce fraud related instances of valuables. Some major life insurance players have already taken steps to experiment with blockchain-based solutions across the value chain. John Hancock, for example, is evaluating a proof of concept for employee rewards.
Predictive Analytics with Machine Learning (ML) – Using predictive analytics with ML, the insurance companies can unleash the power of intelligence, to process complex data source variables into relevant data for actionable insights. This would help them predict what could happen next and what the best decision should be. As far as the insurance industry is concerned, predictive consulting is offered to customers to facilitate 24-hour customer service.