The emergence of new technologies — and the people, processes, and ideas that go with them — has led to an upsurge of disruption in the insurance industry over the past several years in the form of “insurtechs”. Activity in this sector reached a fever pitch in 2021, but it’s by no means slowed down. In fact, in Q2 of 2022, over $2 billion in new investments were recorded. These disruptors will likely change the face of the insurance industry forever.
A traditional view of new technology is to consider it as a cost center that eats into existing needs and requirements for funding. A more enlightened approach recognizes that insurtech disruptors have also figured out how to leverage these new approaches to drive cost savings and other efficiencies. These approaches often pay for themselves and help the insurance enterprise become leaner, more efficient, and, ultimately, stronger.
Not surprisingly, the claims process is often ground zero when it comes to modernizing and improving the insurance experience. Claims are where “the rubber meets the road”, making them important in terms of delivering the level of customer service that is expected by today’s picky digital natives as well as an avenue to achieving greater insights, as well as lower costs, through efforts such as enhanced fraud detection.
- An increase in automation can deliver the double benefit of a better customer experience and lower costs to the insurer. For example, automation allows for greater speed and efficiency in First Notice Of Loss (FNOL) events and, at the same time, reduces the need for costly human intervention for these standardized, routine tasks. A further embedded saving arrives through greater employee satisfaction and, therefore, retention, when they are relieved of boring, routine work.
- The benefits of automation don’t stop with FNOL or other routine interactions: this same approach to self-service can be deployed throughout the claims process whenever possible. An app can become the key point of contact and information, including tracking the status of claims. Additionally, the utilization of push messages and SMS Text keeps the customer informed and satisfied while further reducing the need for insurance company personnel to handle these routine tasks.
- Revised and enhanced capabilities for both internal and external data pay big dividends when it comes to insights that can help lower costs. Existing infrastructure often features siloed and incomplete data that limits the ability to drive analytical insights. A revamped data ingestion and management approach can open new vistas for analytics. This is particularly true for avoiding potential losses from high-risk business where third-party data can dramatically increase insights.
- Such an approach carries over to efforts to both catch and remediates fraud. Fraud is an unwelcome fact of life for any insurance business and it has only increased in recent years as fraudsters have become more and more sophisticated. Fortunately, the same factors that contribute to increased fraud can also be deployed in crafting solutions that increase the strength and capacity of anti-fraud efforts. As with other areas, the integration of third-party data is a big help in these efforts.
Technology that is Driving the Future of Insurance
Insurtech disruptors have grabbed headlines over the past several years. Still, a close examination of the phenomenon reveals that the same technologies, processes, and insights that drive insurtech innovation are accessible to insurance industry incumbents as well. Many insurtech case studies focus on new features and services but as much or more can be gained by focusing on the cost-saving side of the equation. Taking the time to understand all sides of the situation can pay big dividends for legacy insurance players.
Maven Wave, an Atos company, knows that a holistic look at the factors that are driving insurtech innovation can be used to deliver business outcomes, fueled by cloud and enhanced technologies in data and analytics, that keep risk and innovation top of mind. To learn more about innovation in insurance claims, download the white paper “The Future of Insurance: How Insurance Leaders Can Stake Their Claim” today.
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