12 May 2021Insurance

Achieve a customer-centric operating model

Insurers are more than ready to serve a better, digitally-enabled experience to their customers and their employees, but are they always looking in the right places to begin their transformation? Is there enough of an understanding that true digitization means much more than simply computerizing a previously manual process?

At this year’s  Commercial Lines Innovation USA, Eileen Potter, Solution Marketing Manager for ABBYY, explains how to find the most appropriate starting point for your digital transformation program, what true digitization entails and how to sell that concept to the business.

“It’s time to take those processes where some of the gaps have been held together with sticky tape and find a more permanent solution.” Eileen Potter, ABBYY

Why must insurers rethink their customer journeys?
COVID-19 changed everything. It accelerated a digital shift in how people were doing business with their insurers. Customers now expect to be able to do things the way they take the journey on Amazon in any business. Transactions no longer happen on the insurer’s timetable, and that means companies need to do more than take a process and digitize it—they need to reimagine it from the viewpoint of the customer.

Where do we start transforming?
The low-hanging fruit for insurers is first notification of loss (FNOL) and perhaps even the claims process entirely. Companies already have apps to digitize the claims intake, but there is a lot more that can be done.

When COVID-19 hit, there were other parts of the claim that had to be done virtually. Not every insurer was set up to take paper estimates via digital channels. Even when it came to issuing settlement cheques, many insurers weren’t set up to make those payments digitally.

From the customer’s perspective, they want their claims settled fast—and if you cannot meet those expectations, you’re going to lose their business.

How mature are insurers when it comes to taking a data-driven approach to process improvement?
Most insurers look at a workflow and they’re not using the actual data of how something has happened. They’re using anecdotal information. Being data-driven isn’t only about understanding the data they have, but using data to understand where the bottlenecks are in the customer experience, and where the inefficiencies in the organizations are.

Replacing the systems that are doing the processing, or simply adding a new technology to the mix, is not going to make much of a difference if they don’t know the areas in the processing of those transactions that are broken.

Robotic process automation is a great example of this. People think “let’s plug it in” but they don’t get any return on investment. Then they start to wonder why they put it there in the first place. It’s useful, but it’s not smart and it won’t fix a process that’s already broken.

Also, tracking: most insurers are not tracking each part of their process. They have multiple systems with multiple processes that are all trying to interact with each other. Insurers don’t seem to understand how best to leverage those emerging technologies and the insights.

That causes friction between the business and its IT function when they try to get to the root of the problem.

What is the challenge in finding the balance between human and technological resources?
The big thing is understanding where the expertise of your staff adds the most value in a process. For instance, in a claims scenario, how could artificial intelligence (AI) fit in? Using digital intelligence within a claim—it depends on the type of claim—you could potentially automate a simple claim end to end.

Claims handlers play a different role in complex claims where AI won’t drive the decision, and it’s the same for underwriting. AI can enable straight-though processing when it makes sense, but more complex underwriting will still require the underwriters to completely evaluate a risk, with AI playing a part in helping them make better decisions.

How should insurers be following a roadmap towards more intelligent digitization?
If you’d said at the start of COVID-19 that this would go on for a year and a half and you’d be able to rearrange everything to cope with it over a weekend, no-one would have believed you. Now it’s time to take those processes where some of the gaps have been held together with sticky tape and find a more permanent solution.

If there were gaps that were so important during COVID-19 that you had to find a workaround, home in on those. You can’t upend everything in the pursuit of digitization. There are things in your workflow where you can find out where the ball is being dropped now and fix it.

Are there crucial metrics or success markers insurers should be looking for?
The key is that you can’t do everything at once. Understanding your starting point and making those incremental changes to see how they impact things is a solid strategy. Perhaps you’re coming up against what you think is a technology issue but in fact becomes a retraining issue.

The main issue is not to go in and change everything at once. Make small changes, measure, and see if there’s a culture shift. You need data and technology but it’s also important to get buy-in from people.

What is a principal takeaway from your upcoming presentation?
My goal is to help leaders make the business case for transformation, and to get them to understand how to present the processes you want to change. People don’t buy technology; they buy a solution. And that starts with understanding what the problem is.

Eileen Potter will be speaking at  Intelligent Insurer’s Commercial Lines Innovation USA Virtual Event (May 18 to 20). The event is free to attend for insurers and brokers/agents, but you must register in advance. Sign up to access the content live and on demand here.

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