The Current State of Digital Insurance – The Perfect Storm
by Vikas Sachdeva, on Jan 29, 2023 2:53:00 PM
Like most, the insurance industry has been blindsided by the speed at which customers’ expectations have evolved. Insurers have relied on legacy technologies for decades, but a breaking point has been reached. To keep up with the new reality, digital insurers should tap into digital technologies to radically change how they do business and offer a more personalized, seamless customer experience.
Enter the digital transformation. A digital transformation doesn’t just change a business’s processes and culture; it’s entirely focused on transforming and supporting customer experiences. To best meet their existing customers’ needs and attract new ones, digital insurers need to start planning their strategy for a digital transformation. The technology to better meet their customer’s needs is there, but as many businesses know, it is easier said than done to execute a digital transformation.
The experts at Accelare are well-versed in helping businesses from a wide range of industries plan and successfully execute their digital transformations. Now, digital insurers can benefit from this knowledge and advice. Keep reading to learn how digital insurers can break down barriers to a digital transformation.
Digital Transformation and Digital Insurers
Digital transformation is ultimately a business transformation. It takes advantage of digital technologies to upend business processes, culture, and customer experiences to meet changing business and market requirements.
Any digital transformation effort that promises to usher in radical and piercing change should consist of an overhaul of end-to-end business processes and a cultural shift to an innovative and customer-focused organization. Accelare has the know-how and tools to help organizations like insurance companies plan for and execute a multi-faceted business transformation using cross-functional, process-based models that illuminate, run, improve, and transform initiatives.
Breaking Down Barriers for Digital Insurers
The hurdles for a fruitful digital transformation are abundant, but they’re not impossible to clear. The journey should start with building a consensus around an overarching digital mission and vision of creating simple, transparent, and unique experiences rooted in proactive risk management principles.
Once this customer-centric mindset is instilled throughout the organization, change agents should work toward securing seamless engagements across the customer journey, enabled by the power of data and analytics.
Insurers looking for direction in their digital transformation journey should keep these insights top of mind:
- Equip Agents with Digital Tools —Agents, who are the closest link to the end customer, know that they value service speed and quality the most. If they’re not getting said qualities from their current insurer’s systems, they’ll seek out a different one with a smoother experience. Equipping agents with more tools immediately increases their ability to retain customers.
- Data is Indispensable — Data is insurers’ most valuable asset. By pulling actionable insights from data, insurers can better understand the needs of agents and customers. Having that insight allows the business to invest in the areas that matter most to its stakeholders and provide more personalized experiences based on readily available data.
- Favor a Nimble Digital Architecture — Insurers must adopt a dual-speed digital architecture with a transactional core running alongside a fast-moving, nimble customer-centric frontend. The core backend system should be built for stability and high-quality data management. At the same time, the frontend should be flexible enough to accommodate frequent changes to keep up with fast-evolving customer preferences.
- Simplify Product Legacies and Complexities — Rigid legacy systems hinder the digitization of processes and implementation of new IT systems. Customers want simple and fast digital interactions. Often overlooked intricate coverage details that include many specific exceptions can create barriers.
- Build Partnerships — From licensing expertise to managed cloud service to consulting services, bringing in outside skills and perspectives can do wonders to transition to highly digital processes. It may be best for Insurers to partner with InsureTechs to reduce time to market.
- Embrace the Usage-Based Business Model —Customers only want to pay for how they use the insured items and the duration they use the same items. The ability to compile data and insights will help organizations offer personalized insurance packages supported by faster transaction processes. This usage-based approach allows insurers to pass on cost savings to their customers.
Digital Transformation and Accelare
To take full advantage of the potential and possibilities offered by new technologies, a business must undergo a fundamental transformation of its strategy and processes. Simply automating existing processes robs a business of its true potential, potential that a digital transformation can access. A digital transformation has many facets; Accelare has walked many businesses through this process and can offer specialized advice for businesses undergoing a transformation. Articulating a digital transformation strategy is the cornerstone of Accelare’s Strategy to Execution (S2E) process. If you are interested in hearing more about how S2E can help your organization make the most of your digital transformation efforts, please get in touch with us.