How Digitization would impact the Insurance industry?
Digital innovation, or as we call it – digitization – has been bringing about constant changes in the needs, behavior and demands of the customers. And, this is not just from any particular industry, but from all of them! And, how can the insurance sector be left behind?
Rapid digitization has compelled insurance companies to invest and adapt modern IT systems that are supportive of emerging technologies. The core objective of digitization in the insurance field is to completely revolutionise the insurance purchase, client onboarding and claim settlement experience.
How digitization affects the insurance industry positively?
With the introduction of digitization, the insurance sector would see the following positive effects.
Digitization would bring improvements in efficiency of operations, experience of clients and management of data.
It would also enhance multi-channel customer relationships and bring into effect new distribution channels.
With the power of digitization, insurance companies can reduce process intricacies and unleash untapped potential. Costs will get reduced and process efficiencies will go up
Particularly during the recent Covid-19 pandemic, the demand for advance tools in insurance sectors has picked up pace and is in a lot of demand. Tech-enabled tools like Application tracker, Instant OCR, Mobile App, WhatsApp, Speech Recognition enabled IVR, Digi locker are getting popular in the industry making way for the next generation tools. Together they will take the industry to a whole new level of growth.
The insurance sector is a data intensive industry. Therefore, it wouldn’t be wrong to say that technological advancements will prove to be a boon as manual processes get converted into automated ones.
What should the insurance organizations and their CEOs do to keep up (or even super-charge) their digital momentum?
They are updating (or developing) their digital roadmaps.
Digital transformation can’t just happen overnight. It must be designed strategically. Apart from this, it needs to be correctly aligned to ensure that key processes and activities are being connected across the front, middle and back office. For those without a clear digital roadmap, the first step is to formulate that strategy. Those who already have an existing roadmap, will need to revisit and update it. This will help them identify new opportunities for acceleration and alignment.
Insurance heads are also migrating their technology architecture to a platform-based approach.
In today’s rapidly changing technology environment, insurers need a technology architecture that can quickly adapt and evolve. Some of the leaders have started shifting towards a ‘platform’ type architecture. This kind of setup allows new tools and technologies to be added. Also, you can easily remove the older technologies without disrupting the underlying system(s). This makes way for companies to reduce the risk by essentially taking modular decisions. These decisions move towards an end goal while building a more agile environment in which to thrive as an organization.
Insurance companies are partnering across the ecosystem.
The leading insurers are making partnering a core capability. The leaders are making sure to work with a wide range of technology providers. These include everyone starting from Insurtech start-ups and data providers to established technology and cloud storage providers. What’s the benefit of this? This helps them tap into new ideas, tools and approaches. While many continue to struggle to ‘scale up’ their technology solutions and pilots, there are many Insurtech start-ups and technology providers proving their solutions at scale.
They are considering ways to use the new technologies.
As new technologies emerge into the marketplace and new use cases are applied, insurance CEOs will need to ensure they are on top of their game. They have to make sure that they continuously review the technology landscape to identify opportunities. Intelligent Automation, Artificial Intelligence and Machine Learning, are now rapidly gaining popularity across the enterprise technology stack. Low code or no code solutions can help companies speed up. Insurers need to chalk up a way so as to use these platforms to drive forward their digital capabilities.
Insurance leaders are exploring future operating models.
Many Insurance CEOs have been running scenarios since the pandemic began. The need of the hour for them is to change those scenarios into a series of ‘no regret’ actions and investments. This will lead to a range of future operating potentials. Everything should be a part of their agenda. This includes outsourcing and co-sourcing to automation and divestment.
By now we have a clear understanding of the fact that the world is not returning to the norms of 2019; knowing what might come next will be key to developing a strong digital capability. If you are looking to digitize your business, feel free to contact us today! Our engineers are well-versed with the latest technology to help you strengthen your digital foothold!