A step into the future
The insurance industry is quickly catching up to technological advancements across the globe. Like retail, banking and even manufacturing, insurance companies are now emphasizing the dire need for automation and its operational benefits. If properly implemented, automation programs can give insurance businesses to substantially lower costs and scale.
According to a research conducted by McKinsey & Company, up to 25% of full-time job positions in the insurance companies may be replaced with technology by the year 2025. This figure represents the unfolding digital transformation within the insurance sector.
But is business automation applicable to the hard-set workflows which have been built over the decades? With heavy regulations and multiple occupations merged within the industry itself, it can be difficult to pinpoint processes which can or should be automated without disruptions. Upon further research, it has been concluded that basic insurance tasks which remain consistent in all sectors of insurance can be replaced with robotic technology, but some will remain heavily dependent on humans. So how can insurers seek automation solutions that are integrable?
Insurance industries, if they plan to succeed, should start thinking on how to embrace this technological transformation and stay competitive. The question isn’t whether automation technology should be adapted as a core integral processor or not, but rather, when and how? Unlike other industries which have shown little or no reluctance to this new phenomenon, Insurers’ are experiencing internal conflicts and disruptions when it comes to the usage of automated tools.
Let’s look at how insurance companies will be impacted by modern-day automation tools:
- Acquisition of more customers
The key to making it through the tough industry competition is consistent customer acquisition. Growth is a necessity to survive. Prior to the introduction of automated tools, most insurance companies were heavily dependent on referrals, website databases and pre-accumulated customer data. The market reach was limited. But with business automation technology, insurance companies can tap into wider markets through email marketing, lead capture and social media marketing. Automated tools provide easier access to customer data which would otherwise be hard to acquire.
- Lower costs
Automation of processes has proved to be an effective tool for cost-cutting. According to a Harvard Business Report, digitization of insurance processes can help bring down costs up to 65%. On the other hand, conversion rates can improve by up to 20%. But the question arises, how is automation directly linked to cost-minimization? To put in simple words, automation of certain processes such as claims processing, risk management and delivery can provide better control to insurers. This means, companies will have a better and more accurate overview of processes in the que which can enable them to reduce or eliminate bottlenecks. Most costs and expenses occur through wastage of time and other resources. Automation simply brings down such costs.
- Creation of Skilled Labor Jobs
Most skeptics argue that automation will replace jobs and cause redundancy. The truth however depicts a different picture. Automation technology may replace outdated and menial tasks previously performed by humans, but in return will also create jobs for the skilled. With the implementation of technology, the need for technical expertise walks hand in hand. Automation will directly impact jobs and create new ones.
- Increased Process Efficiency
With a streamlined and digitized workflow, processes ae bound to become more efficient. Automation plays an integral role in unifying disparate functions and enabling them to function without disruption. Since processes can now be standardized, it becomes easier for insurers to control them and detect bottlenecks.
Solutions, Solutions Everywhere
With basic effects of automation now understood, we can safely conclude that this technology is well on its way to reshaping the insurance industry. However, this major disruption in pre-existing insurance industry standards is met by several challenges. Insurers are scrambling here and there to find automation solutions that best fit their needs. Certain BPM (Business Process Management) solutions are gaining demand in this sector, but come with heavy drawbacks such as inflexibility and nonintegrability. From affordability to size and from flexibility to customized features, it is next to impossible to find a solution that covers all aspects.
But among the leading automation solutions out there, Value Creation Automation (VCA) takes a unique spot. Designed specifically to meet the challenges faced by insurers, this solution offers it all. VCA not only tackles high-volume insurance tasks such as claims processing, but is designed to oversee functions such as underwriting, slip generation, cost accounting and risk management. The solution integrates all tasks within insurance workflows to create a single and unified framework for maximum control.
Value Creation Automation is quickly gaining momentum in the insurance sector. The solution is aimed to give companies control over business functioning that ultimately leads to growth and scalability.