4-Step Strategy to Jump Start Digital Transformation for Insurance Companies
by Ken Neal
January 5, 2022
The insurance industry is no stranger to change. With their initiatives to protect businesses, families and individuals against threats and risks, insurers must continually respond to new conditions. Business agility and speed are essential, and the need to embrace successful digital transformation has become increasingly urgent.
Nearly two years into a global pandemic, that need is greater than ever. In fact, the digital imperative has only grown throughout the pandemic. Not only have insurers faced disruptions to traditional operating models, but also their customers’ expectations have shifted, placing a premium on seamless digital technology and experiences.
The industry is seizing the opportunity for change. A recent KPMG survey of insurance CEOs revealed that 85% of organizations have accelerated the digitization of their operations and their pivot to next-generation business models as a result of the pandemic. Nearly 80% report that improving customer experiences is a core pillar of their transformation journey.
To make the most of this moment of acceleration, insurance companies must have a comprehensive, holistic digital roadmap that includes new technologies. By focusing on connecting and optimizing all of the links in the insurance services value chain, they can achieve meaningful transformation at scale.
For example, insurers can transform distribution and service by creating self-service and digital platforms; streamline underwriting with automated data ingestion, streamlined workflows, artificial intelligence (AI) and predictive analytics; and re-engineer the claims process by leveraging innovative underwriting and claims platforms to enhance competitiveness and drive revenue. Let’s take a look at how your organization can respond to the digital imperative and make the most of the opportunities it offers.
It’s not always easy to respond to paradigm shifts, but there are massive opportunities for insurance companies that can successfully keep up with the lightning pace of change. Insurers that are leading the way in digital transformation follow a high-level, four-step strategy that allows them to out-execute their competitors with speed and at scale:
1. Maintain clear focus with a holistic digital roadmap. Digital transformation isn’t just about your technology stack. It touches every part of your business, but many organizations stumble when it comes to creating a comprehensive digital strategy. If you tackle transformation bit by bit rather than holistically, you risk misalignment across units, siloed data that delays action, costly redundancies and insufficient speed. Build a digital roadmap that keeps your organizational focus on shared goals and gives you the flexibility to adapt to new circumstances.
2. Invest in innovation. Insurers understand the need to innovate, but it can be challenging to understand which investments have the biggest impact for stakeholders. The right innovation plan will allow you to tackle low-hanging fruit for immediate returns while also obtaining buy-in and momentum for your larger digital strategy. You can apply automation, AI and machine learning (ML) capabilities in labor-intensive areas like claims and contact centers, while digitizing your document management to liberate your talent to focus on revenue-driving activities. Document digitization can also increase the quality and availability of actionable data that can lead to further innovations in process or product offerings.
3. Re-engineer broken processes and operating models. Silos and inefficiencies create huge friction points for transforming businesses. In insurance, that often means a reliance on manual or redundant processes and paper documentation, both of which can create hang-ups in your workflows. These blind spots can often go overlooked, so it’s beneficial to begin your transformation with a process audit across your ecosystem to identify key opportunities and solutions that can optimize your environment and solve the biggest problems first.
4. Don’t go it alone. Leading insurance companies draw on decades of institutional know-how to deliver the best services to their customers and grow their business. But most are not experts in delivering technology at scale or conducting a comprehensive audit of enterprise-wide processes. Finding the right managed services partner allows you to evolve more rapidly than you could alone. The right partner will have expertise in the insurance industry so they can accurately evaluate your digital transformation needs. Armed with this knowledge, they can supplement your technology capability, help you reinvent processes and workflows, and provide you with the operational flexibility of insource, outsource or offshore models.
Manual document processing is a significant bottleneck for insurance organizations. With an intelligent automation solution such as Canon’s Intelligent Automation Suite (CIAS), insurers can automate many aspects of claims processing, first notice of loss, new business processing, and change processing to streamline these efforts and save money.
For example, insurance organizations can use automation to implement a document management solution that will tackle their challenges holistically, optimize workflows across the business, create greater efficiencies and build a springboard for future innovations. Intelligent automation features that are especially useful for insurance companies include:
- Automated classification and extraction. Automated classification and extraction engines use ML-generated rules to recognize forms or consistent content, and then key into data for extraction. As they do so, they validate the confidence of that data via database matching — before any human intervention is required.
- Robotic process automation. Digital systems often use robotic process automation (RPA) to automate rote or repetitive tasks across the business. This can have a huge impact on the insurer’s claims processing, enabling the automation of forms with extremely high accuracy, mitigating the risk of human error and integrating data seamlessly across systems.
- Workflow management. Automation helps insurers achieve greater visibility into workflows and reduce friction across business units. Solutions such as CIAS integrate disparate workflows into a single platform, which gives decision-makers a unified view and can lead to greater transparency through shared reporting and governance.
- Forms implementation. Modern automation solutions allow insurers to receive and process claims automatically across multiple devices such as tablets, phones or laptops. This means that their customers can work with them when and how they prefer — and it helps the insurer deliver the superior experience customers expect.
- Integrated human-machine workforce management. By combining the data gathered through classification, extraction, RPA and workflow management, a robust automation suite such as CIAS evaluates the key performance indicators (KPIs) associated with the process as a whole. This can provide insurance companies with individual steps to generate continuous improvement.
With these tools in place and new insight into processes, insurers can achieve straight-through processing of small claims, automate quality control to avoid missing information on critical documentation, and maintain contact and personal records for customers with minimal human intervention.
The Canon team is ready to help insurance organizations create their foundation for accelerated transformation. Let us help you put optimal processes in place and score big wins in automation so you can meet today’s digital imperative — and prepare to address future evolutions for better business outcomes.