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Achieve insurance automation heaven in three steps

By Jerry Wallis, Head of Industry, SS&C Blue Prism

The insurance industry is facing unprecedented challenges because of global volatility and inflation surges. In the first eight months of 2023, the US experienced 23 separate weather and climate catastrophes, each costing over a billion dollars. This factor is a major cause of the unique challenges that have tested the insurance company in 2023 and will continue to in 2024. Due to the significant protection gap, consumers and businesses are relying on insurers more than ever, consequently driving up premiums.

Demographic shifts and changes in social contracts have also added to a US$1.4 trillion – and growing – shortfall in health insurance coverage, retirement savings and life insurance.

As a result, insurers must think faster and differently in rapidly changing markets and are turning towards launching new online or cloud services. These are driven by artificial intelligence (AI) using new underwriting models and distribution channels in an effort to appeal to new customers. Affordability, awareness, appeal, and trust are key motivations for buyers.

Many insurance companies have started their digital journey with AI and data analytics through Business Process Management (BPM), chatbots, and customer portals to become more cost-conscious and customer centric. But while the increase in adoption of AI driven policy calculators and application processes demonstrate a great mindset shift for the industry, some firms are struggling with how to join up these technologies enterprise-wide and can’t expand.

According to a recent Deloitte survey of 100 U.S. life insurance and annuity chief information officers whose firms have begun their core system modernization journey, fewer than a third have completed some (20%) or all (12%) of their initiatives. Just over two-thirds have projects currently underway or in the planning stage.

In this climate, how do you compete in a global US$10 trillion market, or differentiate from the big players as an independent? The answer to gaining competitive advantage that drives business and sustains loyalty in the face of these and other threats, can be found in intelligent automation to offer tailored personalization of services to attract and retain customers by enhancing their experience.

Consumers and customers making claims have undergone their own “digital transformation” over the past two decades, becoming increasingly comfortable with everyday Internet of Things (IoT) powered technology. Personal tech has increased the ways in which we interact with our home appliances from mobile devices.

While raising customer expectations for easily navigated experiences from the brands they do business with, in turn, this has given insurance companies access to larger and broader data sets to assist with actionable advice to encourage preventative measures reducing customer claims.

Compounding these challenges, insurance companies are trying to keep up with the proliferation of new, intelligent technologies. In addition to AI, machine learning and robotic process automation – more commonly known as machine learning (ML) and RPA respectively – are also making greater inroads in the industry.

To help you navigate and understand these technologies, how they fit into your operation, and start implementing them, SS&C Blue Prism has three steps to help you begin your automation journey.

Step 1: Strategy

The first part of any journey is deciding where you’re headed. Establish an ideal outcome and ROI target for your intelligent automation, whether that be revenue, cost savings, reducing error, employee satisfaction, customer experience or compliance. Once you have your objective clearly laid out, it will be easier to deploy your automation where it will be most effective.

Our most successful intelligent automation clients always have a robust strategy combined with great people from the business and IT working together to deliver a clear plan. The Gartner® Avoiding the 10 Most Common Mistakes in Financial Services Automation report, provides insights into how financial services companies can avoid the pitfalls of their automation journey and achieve long-term value from their investments.

Step 2: Identifying inefficiencies

Identify bottlenecks or inefficiencies in your operations. One of the simplest ways to identify these problem areas is through process mining. Process mining analyzes your current processes to determine where improvements can be made. From there, you’ll be able to set goals, from the quick-wins of routine task automation to the orchestration of long-running processes and augmenting intelligent decision-making capabilities to evolve those processes.

Step 3: Finding the right IA solution for you

This is where you can decide which intelligent automation solutions will best respond to your needs, including the metrics to monitor and drive ongoing improvements as they run. For example, business process management gives you total visibility of your business processes to help you orchestrate and manage work. This is imperative for scaling. SS&C Blue Prism® Chorus offers a full BPM suite for managing roles and rules and gathering insights on operational analytics.

The insurance industry is ripe for increased digitization and automation. Between diminishing investment returns, vast workflows and growing data volumes, competitive encroachment from non-traditional players, changing customer expectations and rapid advancement of new technologies, it’s clear the insurance marketplace is transforming.  Additionally, there is also a need to manage and mitigate financial risk to maintain a suitable level of reserves amidst the increasing frequency of existential crises.

To stay at the forefront of a competitive market, insurers must prioritize transformation. This can be achieved through increased automation and digitization, allowing insurers to become increasingly perceptive and achieve economics of sale. Coupled with the enhancement of employee effectiveness and a personalized customer experience, insurers can minimize customer risk and improve reputation. The importance of a personalized customer experience is vital, as it can help to build trust with customers, leading to loyalty and retention.

To help insurance companies achieve their strategic priorities, bridge the digital divide and unlock the full potential of intelligent automation, various intelligent automation platforms and tools are readily available that can deliver transformative business value to insurers.

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