Automation is transforming nearly every industry. Businesses are automating internal processes. Retailers are automating customer checkouts. Even shipping companies are automating their operations. One—perhaps unexpected—industry that is automating more and more is the insurance industry. Insurance automation is on the rise and ready to transform the industry in many positive ways.
Read on to learn what insurance automation is, how it can transform the insurance industry, the benefits of transformation, and use cases for how insurance automation could look.
What Is Insurance Automation?
Insurance automation is a tool to streamline many insurance processes and perform them using technology. Ideally, the processes of marketing, renewals, and sales could be automated and performed by technology quickly and accurately. Technology has become an integral part of most industries, and it's continuing to grow for good reason. Incorporating automation into the insurance industry is a way to provide customers with a quicker and more accurate experience and for insurance companies to be able to divert valuable employee time to the most pressing tasks.
Automation Will Transform Insurance
Technology has been transforming every aspect of business, including in insurance already. Automation is the next step in the technological transformation of the insurance process. These are some of the key ways that automation can transform the insurance process and the insurance industry.
Better and more personalized customer experience
Some of the aspects of getting insurance can be time consuming—especially onboarding. The long onboarding process can make insurance a time consuming process, and customers can get frustrated. But when insurance onboarding is automated, customers have a better and more personalized experience.
The better experience starts right with the speed and efficiency of onboarding. Robots and technological tools can perform the process (including anti-money laundering) and get the customers ready to meet with insurance agents quickly. Then the time customers interact with the insurance team will be spent on the important and personal aspects of their experience—instead of onboarding paperwork. Insurance employees can then spend time with customers giving them a personalized and positive experience because automation removed frustrating roadblocks.
Impact on employment in insurance
With automation, many people are worried that technology will take over jobs and make insurance employment opportunities scarce. It is true that automation can eliminate some positions, but it can also lead to the creation of new and more exciting positions. Employees will be freed from paperwork positions and tedious data-entry tasks, which instead gives them the opportunity to work in more fulfilling roles.
Instead of entering data and filling out paperwork manually, employment opportunities will shift to increase time spent working with customers and on projects that require the human touch. So automation may remove some insurance employment positions, but it can open new positions that can be more exciting and more important to have employees focused on. Ultimately, this change can make insurance employment opportunities more enticing and eventually benefit the customers who have more important human interactions and a more personalized experience.
Another concern many people have with automation is that it will be difficult to integrate into existing systems. But automation tools will be built into existing IT infrastructure for easy integration between all of the systems and an easy launch process. Automation is just the next step in the technological transformation in the industry.
Benefits of Automation in the Insurance Industry
Since automation could transform insurance, what are the benefits of allowing it to do so? What are the benefits of automation in the insurance industry?
Cut costs and drive efficiency
Time is money in business, and the same goes for insurance. The more time spent on tasks that can be automated takes away from important tasks like connecting with customers. If an insurance company can instead have their employees focused on more valuable tasks, insurance companies are saving money because they’re only paying for employees to do what only employees can do.
As companies shift to automation, processes become more efficient. Robots and other technological tools can take care of many processes quickly and efficiently—in seconds instead of hours—which saves insurance companies time and improves efficiency.
Improved efficiency and automation is also a prime way for companies to grow. Company growth requires a certain level of scalability to successfully expand without losing efficiency and capabilities. Automation helps improve scalability in a way that allows for entire enterprises to grow and expand. As processes are taken care of by robots and tools, insurance companies can find it easier to expand and grow without losing any efficiency because tools are taking care of most processes that would struggle in growth.
Improve customer experience
When insurance companies have their employees focused on customers, the customers are going to have a better experience. Their needs are met by the insurance company employees, and the employees have the time and energy to help make customers’ experiences positive.
Customers also benefit from the speed and efficiency of automation. The typically time consuming processes can be taken care of quickly—which improves the customer experience. Customers no longer need to wait several hours or business days to get something taken care of with automation.
Drive sales growth
Automation is a great way for insurance companies to drive their sales growth upward. Faster and more accurate processes create the right environment for sales growth. Customers are happier, companies are saving money, and scalability is possible. All of these help lead toward sales growth.
Integration with legacy applications
Insurance companies usually have legacy applications they need to rely on to do business. New software and tools typically require revamping of systems and overhauling legacy applications. Most big changes necessitate new hardware and employee training that can be time consuming and lead to significant costs. Fortunately, automation can come without these heavy consequences.
Automation can be integrated with the legacy applications. That saves companies time and money because they can automate processes without having to create a new technology system to work in. Instead, they can continue with their usual applications and tools while simply adding automation to the equation.
In this day and age, insurance document fraud is unfortunately a growing reality. People can fake insurance claims, and it’s harder for an employee to find these errors—especially with sophisticated fraud. Filing fraudulent claims can cost the company more money than they can pay. Automation can improve fraud detection by leaving detection to robots and technological tools that can more accurately determine fraud. Stopping fraud saves companies money and keeps the insurance company running even in difficult environments.
Reduce human error
The unfortunate truth is that humans make errors, even the best employees do. Computers rarely make errors when systems are running properly. Leaving processes to the computers reduces both opportunities for human error and error in the automated processes. Employees can’t make errors on processes they no longer oversee, and the processes that are automated become more accurate.
Best Use Cases for Insurance Automation
Automation can be so beneficial to insurance companies, but some of the success lies in choosing the best use cases for automation. There are some processes that lend themselves to automation in a way that can improve the company. Here are some of the best use cases for insurance automation.
Insurance automation can quickly and accurately perform a pre-qualification process that provides employees with valuable information. When an employee meets or talks with a customer, they already have a well of valuable information at their fingertips to help the customer and move them to qualification quickly.
Claims processing is sometimes the bread and butter of insurance. A manual processing system keeps customers waiting, which can be frustrating. The faster the claims processing, the happier customers and employees alike are. Automation can quickly review.
- Medical certificates for health and life insurance
- Photos of damaged cars and accident reports for auto insurance
- Photos of damaged luggage and boarding passes for travel insurance
Instead of taking several weeks, automation can make this happen in minutes.
Managing a policy requires submitting forms, approving forms, entering information, and more. All of these things take time and can slow down employees from more valuable work and keep customers waiting. Automation can take care of these processes for insurance companies, making policy management quick and painless.
Insurance automation can do more than people think. Automation can also take care of underwriting processes by reviewing customers’ claims, assessing losses, and collecting data on risk. Automation can even provide recommendations based on the information gathered. Essentially, a customer could apply for a policy, and within minutes, the automated tools could have a comprehensive analysis of potential risks and recommendations moving forward.
Compliance is crucial in insurance. But screening regulatory services like Name Screening Alert Review for Sanctions and PEP is time consuming. Screening systems can pop up with thousands of alerts, and most of them are false positives. Instead of spending time on these compliance alerts, automation can sift through the alerts and determine which ones are worth noting. This use of automation saves time and helps employees focus only on the compliance cases that they need to.
The Bottom Line
Overall, insurance automation can transform the insurance industry and benefit customers and insurance companies. As these benefits become more prevalent, automation will continue to grow and become the future of insurance.