In the near future, the insurance marketplace will look nothing like the one you know. Regulations and a conservative business approach have insulated the industry in the past, but now, outside forces are ushering in a period of rapid change.
Three key shifts underscore the change and what insurers must know to grasp the breadth and depth of change, as well as the urgency.
1 Shift from policy-centric to customer-centric
Insurers have traditionally resided in the background, offering security in the knowledge that when trouble strikes, customers have a resource to call on. As a result, customers thought about insurance only when buying policies or making a claim.
Insurers who shift tactics to a customer-centric approach will find a wealth of opportunities to connect with customers. The digital insurance experience is about anticipating customer needs and developing products and associated services that encourage them to buy. It’s also about providing them with an ongoing set of branded experiences.
2 Shift from data capture to data analytics
Insurers have been collecting and using data for years, but today, the strategic aggregation and analysis of data promises to transform every part of the industry value chain. Data can now enhance new product development, marketing, distribution, underwriting, and overall brand management as insurers gain a more comprehensive understanding of customers and risk.
Data-driven product development helps bring new, highly personalized products to market faster. Analytics offers the potential to evolve pricing strategies to benefit both customers and insurers. And of course, data holds the key to helping insurers identify potential fraud before or as it happens, instead of reacting to misrepresented claims after the fact.
3 Shift from manual to digital
Digital insurers will need to offer a seamless omnichannel buying experience that augments traditional channels with robust self-service and digital options. A truly digital customer experience starts with products that are easy to comprehend and simple enough to enable e-applications, automated underwriting and direct issuance — all of which help to deliver the type of instant gratification consumers expect in a digital economy.
Digital insurers will need to automate as much as possible, from front to back office. Digital agents/advisors, machine learning, mobile self-service, process robotics, IoT sensors and telematics will all play a role in improving both efficiency and customer service all along the value chain, from new business to claims. To deliver on all of these requirements requires a complete end-to-end digital insurance platform, including a modern API integration framework, an ecosystem of service providers, and a whole new set of persona-based systems of engagement.
The task at hand is more than any one company can handle alone. Your business can no longer expect to keep up with the massive investments being made by incumbent and new technology leaders. Neither can your company amass all the skills and experience necessary to create transformational change at the pace required today. Instead, you should re-evaluate your partnering strategy.
Companies that understand and respond to changes in the industry with the right technology partners have the opportunity to capture new growth opportunities, control IT costs and lay the foundation for a more dynamic and profitable future.
Read more in the white paper, Key Shifts Mark the Path to Digital Insurance.
As the chief technology officer for CSC’s Global Insurance business, Brian Wallace drives technology strategy, client-focused solution development, and the ongoing alignment of CSC’s capabilities to the needs of the insurance industry. He engages with clients, prospects and partners around digital disruption and the future of the insurance industry. Connect with him on LinkedIn.