Diving Deeper into Prioritizing Your Strategic Digital investments
Oliver Winkenbach | March 08, 2018
Digital disruption is becoming a key trend across the P&C insurance industry. For example, more and more customers/policyholders expect to be able to buy and modify their policies online without having to interact with a representative. In response, early-adopter P&C insurers are investing more heavily in new core platforms, adding digital capabilities and offering self-service capabilities online. According to a recent McKinsey report, these early adopters are reaping the rewards, growing twice as fast as their peers and spending less.
Spurred by the success of the early-adopter P&C insurers, more insurers are now interested in expanding their digital capabilities. But they struggle to determine where to start. We introduce a framework to help P&C insurers determine their most important strategic objective — automated operations, compelling journeys, data-driven decisions or agile businesses. These areas include an insurer’s current value proposition, new initiatives, digitizing internal operations or digitizing the experiences offered to external stakeholders (e.g., customers, vendors, agents/brokers).
In this article, we focus on the business objectives to automate operations and create compelling digital journeys for insurers’ customers.
Automating Operations and Creating Compelling Digital Journeys
Most insurers begin their digital transformation by automating operations. As part of this, they likely upgrade/modernize their core operating systems (aka, “legacy replacement” or “core transformation”). They utilize microservices/APIs, integration hubs and rules engines to drive paperless operations and straight-through processing.
For example, one of the largest auto and workers’ comp insurers in New Jersey started its digital business transformation initiative with an upgrade to its core systems. This upgrade allowed the company to standardize and streamline processes and system infrastructure. Today, this insurer is able to quickly make process and system changes to bring new products to market. Many transactions (e.g., policy quotes, rate comparisons, and purchasing transactions) can now be handled online. Policy administration and billing practices are standardized across the company for consistency and accuracy.
Insurers are increasingly looking to create compelling digital (customer) journeys
by focusing on omni-channel, mobile-first and personalization strategies. These enable more self-service, better agent/broker collaboration and increased agent productivity.
The next example illustrates how one large insurer focused on creating compelling digital (customer) journeys by embracing omni-channel to increase sales. Long committed to its independent agent channel, the insurer realized that it also needed to provide direct-to-consumer sales and services capabilities to retain and gain more market share. Today, the insurer offers consumers options to buy direct any time through a mix of channels, including web, mobile phone and call center.
While getting an online quote, shoppers can easily click to chat or call to talk with an agent, who has direct access to the insurer’s core systems, including all the data entered through any of its direct channels.
Key to a good customer experience — one that drives more business for the insurer — is making it all seamless. Ideally, the agent or customer service representative can see exactly where the buyer is in the quoting process and can move forward with the transaction without duplicating any questions or re-keying information. To avoid potential channel conflicts, the insurer assigns an agent to every direct-channel customer for future servicing. The agent still earns a commission, and additional opportunity to upsell or cross-sell the customer after the initial sale.
While automating operations and creating compelling (customer) journeys delivers significant benefits, insurers shouldn’t ignore other critical factors for the digital success. Expanding a new core platform installation with new digital capabilities (e.g., portal for policyholders/customers) can be achieved in a relatively short time without requiring large upfront investments.
Keep in mind that the most successful insurers will invest in all four areas — automating operations, creating compelling journeys, enabling data-driven decisions and enabling agile businesses. By doing so, they will position themselves as leaders today and in the future.
- Insurtech Landscape 2019: Top 5 Takeaways
- Grinnell Mutual Tackles Massive Transformation -- in Stride
- A Candid Conversation with Paul Mang
- SageSure Insurance Managers Improved Competitiveness by Consolidating Payments to a Single Digital Platform
- Digital Does Matter in Insurance-- And Insurers are Missing the Mark
- The 22nd-Century Insurer: Taking a Cloud-First IT Approach
- The September/October 2019 issue of ITA PRO magazine is now available in digital format here:
- ITA Pro Magazine May/June 2019
- Spotlight on the 2019 IASA Conference
- ValueMomentum Selects Erie as Site of Regional Development Center
- Capgemini and Majesco Become Alliance Partners
- Electronic Chat with Dr. Dan Shoham
- Electronic Chat with Todd Greenbaum
- Martha Notaras: The “Outsider” with an Amazing Inside View
- Electronic Chat with Larissa Tosch
- Martha Notaras Will Join ITA LIVE 2019 as a Keynote Speaker
- Five Things to Consider When Evaluating Your Cyber Risk
- ITA Pro Magazine, January/February 2019
- Synergy Between Insurers' IT and Analytics Teams Key to Operationalizing Insights, Says Novarica
- Major Ransomware Attack Could Hit U.S. with $89B In Economic Damages
- ITA Announces 1st of Three Keynote Speakers at ITA LIVE 2019
- Electronic Chat with Jeroen Morrenhof
- Legacy Systems Are Dead. Really? Don't Count On It.
- Now Accepting Nominations for the 2019 ITA Bridge Awards
- It's time to register for ITA LIVE!
- Registration is Now Open for ITA LIVE 2019!
- What to Expect from a Digital Experience Platform Implementation
- ITA Pro Magazine September Edition is Now Available
- It's National IT Professionals Day
- Save the Date for ITA-LIVE 2019
- OneShield Software and UrbanStat Work Together to Improve Real-Time Analytics and Risk Decision-Making
- ITA LIVE 2019 - SAVE THE DATE!
- Insurance Technology Association Announces New Editor-in-Chief
- August 2018 Edition ITA Pro Magazine is Now Available
- Enterprise Architecture in an Agile World
- Top 10 Tips for Securing Your Mobile Devices and Sensitive Client Data
- Industry Insight: 4 Global Insurance Trends in Digital, Data, Content Services and Security
- Diving Deeper into Prioritizing Your Strategic Digital investments
- Why Content Rules
- How Mass Personalization Will Open the Small Business Benefits Market
- At Year End 2017, Will Your Organization Be Protected from Cyber Risks?
- Do Insurance Bots Dream of Mitigating Risk?
- Conditioned to Respond
- Managing & Mobilizing Insurance Data in a Connected World
- Race to the Finish Line
- New Tools, New Opportunities in Claims
- ITA LIVE: Reaching Insurance Industry Crossroads
- Advice to Insurance IT Leaders: Keep Your Eye on the Ball
- New Date, Venue for ITA LIVE 2017
- Guidewire Makes Major Push to Small and Midtier Market by Acquiring ISCS
- Insurance Disruption is Happening Right Now
- Insurity Adds Strategic Investment Partner, General Atlantic
- Beyond Transformation: The Convergence of Finance, Risk, and Actuarial Functions
- The Rapid Evolution of Consumer Protection Regulation
- Talent Hunt: Finding, Attracting, Retaining Top People
- Insurers Flexing Their Distribution Models
- Technology Driving Disruption in Insurance
- Fear of ‘Next Bubble’ Challenges Life, Annuity Carriers
- Technology Allows Commercial Lines Insurers to Stand Out
- Single Sign-on Viewed as Biggest Tech Challenge for Agencies
- ISCS Observes 20th Anniversary; Scurto Predicts Major Changes Ahead
- Policyholders and Their First Impressions
- Progressive Making Progress on the UBI Front
- High and Dry: Insurers Search for Disaster Recovery Plans
- Insurers Sign The (Un)Dotted Line
- Reflections of a Retired Insurance CIO
- Mobile Device Management Just One Answer to BYOD Issue
- Lessons from GEICO and Progressive on Winning the Critical Buying Stage
- You Are a Target for a Cyber Attack
- Web-based Systems are the Next Evolution in Claims Technology
- Gaining a “Wow” Experience from Web Users
- Time to Shift from Business/IT Alignment to Business/IT Alliance
- Healthcare Insurers Changing to Consumer Model
- Organization is the Key for Selecting Software Vendors
- Analysts Expound on the Needs of the Mid-tier Insurance Market
- Finding the Cure for Obamacare’s Website
- New Software Solutions Benefit Insurers on the Inside and Outside
- Products, Market Impede Investment in Systems for Life Insurers
- Combatting Cyber Threats: Predict, Prevent, Persist
- The Future of Telematics Heads Beyond Insurance
- The Shame in Cyber Security Lapses
- Building Policy Administration Systems for the Future
- Insurers Look Into The Eyes of Their Policyholders
- It’s a New Dawn for the ITA
INSURANCE IT NEWS
- Chisel AI Named as an IDC Innovator for Insurance Sales Automation Solutions
- New Majesco Report Emphasizes the Burning Platform for Insurance Transformation and Market Leadership
- Veruna Named Insurance Technology Company of the Year
- Joint partnership between MedRisk and Raintree Systems to reduce administrative burden and expedite payment for physical therapy
- Hearsay Systems Joins Guidewire PartnerConnect Solution Alliance Program
- Effisoft's Reinsurance Software Named "2019 Software Innovation of the Year" by Reactions Magazine
- Virginia Farm Bureau Mutual Insurance Company Selects One Inc for Claims Processing
- OPTIS Study Finds Big Players Still Paying Top Dollar for P&C Agencies
The Email Chat is a regular feature of the ITA Pro magazine and website. We send a series of questions to an insurance IT leader in search of thought-provoking responses on important issues facing the insurance industry.
ITA LIVE 2020
ITA LIVE 2020 –SAVE THE DATE!
April 5th – 7th, 2020
The Diplomat Resort
Become a member today to receive updates – www.itapro.org/MR
BLOGS AND COLUMNS
You have surely heard it said that small businesses are the growth engine for America. Today, the phrase has a special ring to it for benefits... READ MORE
With stagnant growth and lingering low interest rates, the life insurance industry faces a challenging future... READ MORE
Finding insurance carriers willing to write commercial lines risks has always been a challenge for producers... READ MORE
As Guidewire Software prepares for the start of Connections, its 11th annual user conference that begins on Nov. 2, Brian Desmond, chief marketing... READ MORE