The new digital scenario requires insurance companies to face a transformation process that not only affects business and corporate culture but also generates a new customer experience model. Today, digital capabilities enable new ways of reaching customers, to convey more transparent products and propose solutions which can be offered without physical interaction and paper documentation. Technological, cultural, managerial, creative and organizational transformation offer a wide range of opportunities to get to know customers in a more targeted and in-depth way. They help to strategically identify their needs and be able to serve them better, widening margins and enhancing the available proposals.
Insurance is ripe for the kind of disruption that has roiled many other industries such as retail and banking. Bain & Company’s fourth global survey on retail insurance customers shows that consumers—especially digitally active millennials—are very open about switching to another provider, including one from outside the industry, such as a retailer, automaker or tech company who are keen to provide insurance coverage. Digital innovators are upending markets with products and services that they sell directly to consumers overtaking traditional companies by creating more value.
‘New management models and Digital transformation are essential elements to face this scenario with pragmatism and the right strategies, especially as the goal is to improve the customer experience’, says Mehdi Benabdallah, Director at Comdata Digital, expert on CX in Insurance sector.
DIGITAL TRANSFORMATION: A HUGE OPPORTUNITY FOR INSURANCE
To face the challenges of this magnitude it is necessary to implement a profound transformation of the business, which aims at a differentiation of the offer, at a reduction of costs, and seeking new opportunities. Moreover, it is necessary that the transformation also involves the personnel of the companies and more generally foresees the adoption of a new model of governance of internal and external processes. According to a global survey, 84 percent of insurance executives said that through digital transformation, companies are weaving themselves seamlessly into the fabric of how people are living. Insurers are pursuing innovative products and services, part of a larger strategy to drive company growth by embedding technology into customers’ everyday lives.
‘We are in fact facing a strong digital acceleration linked above all to the advent of disruptive innovations such as artificial intelligent robotization, big data and IoT’, explains Mehdi Benabdallah. The incredible amount of data that will be provided by these technologies is a huge opportunity for the insurance market to adjust the products, measure the risks, and more. For insurance companies it is essential to create new points of contact with the customer, which allow proactive and personalized management of customer experience.
For example, thanks to an app installed on the customer's smartphone, the insurance company's claims office can check the damage caused by an accident in real time. So, the agent is remotely able to activate the reimbursement procedure without sending an expert to inspect the vehicle. However, the insurance market is already strongly regulated especially in Europe thanks to the new GDPR. In this process digital innovation is a fundamental enabler to be compliant with those requirements. With the customers authorization, the huge amount of the available data can be used to hyper personalize any information, not only commercial offers, but also to provide specific messages in order to increase the customer experience anytime, everywhere.
THE IMPORTANCE OF AI IN INSURANCE
But the role of technology is not limited to that. The adoption of the new digital solutions available on the market also serves to ensure a constant update of user information through sources such as social networks and data from loT sensors. Thanks to Artificial Intelligence it will be easier to maintain a constant relationship between companies and customers. Furthermore, robotization and AI will free up human resources in order to use them better in all the most critical and delicate situations. Then, one of the main challenges of the sector in terms of HR is to anticipate the new jobs of tomorrow developing the required skills of the current teams to face the digital transformation.
DIGITAL TRANSFORMATION AND SIMPLIFICATION IN INSURANCE
‘Our task is to allow insurance companies to become more agile in process management, integrate online and offline channels, and make the customer journey seamless regardless of which is the preferred access channel and contact between customer and company’, explained Benabdallah.
Another essential element of the digital transformation process that the insurance industry must accomplish is linked to simplification. Most insurers have a long way to go when it comes to consistently meeting the needs of their customers. While many incumbent insurers perform adequately on functional elements such as quality of products and risk reduction, they often fail to make interactions simple and easy, even though their customers consider ease of use very important.
A digital strategy that aims to improve the customer experience and the efficiency of the insurance companies cannot ignore the need to better manage security issues.
The number and sophistication of cyberattacks are increasing and are likely to get worse. Advanced technologies are likely to play a crucial role in the future of both cyberattacks and cyber resilience in insurance. But in the context of cyber defense, fewer than half of companies are investing in advanced technologies such as artificial intelligence (AI) and machine learning (43 percent), or in automation technologies (39 percent), a recent Accenture Survey reports. If insurance companies don’t keep up with the latest tools, then their cyber risk is expected to increase. ‘Helping our clients to keep safe the data is one of our jobs’, says Benabdallah.