BLOG: Digitizing customer engagement reaps benefits for insurers and brokers

Today’s insurance customers demand more. This creates a challenge – and an opportunity – for the insurance industry, writes Kirby Wadsworth of Mendix.

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By Kirby Wadsworth, CMO, Mendix - Today’s insurance customers demand more. Their digital experiences with companies like Amazon, Netflix, and Uber have dramatically reshaped their expectations for how they interact with insurance companies and brokers. Like ordering anything online, they expect their insurer to provide instant access to information, easy self-service transactions, and a seamless experience across channels and devices. The good news, according to some studies, is that consumers are willing to pay more for the value and convenience of an excellent online experience.
 
This creates a challenge – and an opportunity – for the insurance industry. Insurance companies have decades of optimized processes and systems that are not aligned to this new digital business model. Disruption is a real and looming risk, and perceptive insurers realize they must become digital businesses. They have no choice.
 
According to a recent study by Accenture, 73 percent of insurers believe that improving customer experience is a top priority in 2015. By assessing customer needs, prioritizing the broker-customer relationship, and digitizing customer engagement through rapid, continuous innovation, insurance providers can better serve their broker channels and in turn, meet mounting customer demands.
 
Insurance policies can be extremely complex, and with the wealth of information available online, helping customers navigate their options can be difficult. Brokers need to be able to provide quick service and answer complex questions in real time. Moreover, customers now prefer to interact with insurers through digital channels first, whether it is the web or mobile devices, and they want transparency at every turn. They also want fast service on claims, so it is critical that both customers and brokers have access to the right information and services at any time, from any device.
 
While many insurers see the importance of facilitating greater customer and broker access, existing systems are limited. For instance, most customer portals currently only provide access to billing info, forcing brokers to continue to rely on manual, PDF-based processes for services like changing contact information, beneficiaries, and ownership.
 
New software applications, portals and other digital services can offer great benefits to both brokers and their customers, including:
 
  • Increased Premiums – Brokers can generate quick quotes, and facilitate faster transactions with automatic underwriting, policy binding, and cover note generation. In addition, they can increase up selling and cross selling through a more unified view of customer and product information.
  • Transparency in Operations – Insurers can provide better communication and transparency to brokers such as sharing news, offering incentives that are more visible and promotions, broker ratings for competition and various dashboards.
  • Reduced Administrative Costs – Insurers can provide a better broker experience with streamlined commissions and claims payouts, automated broker ratings for tailored commission structures and self-service fulfillment of office supplies.
  • Better Customer Experience – From automatic broker renewals to guided advisement tools and self-service reporting for life events, brokers can offer customers a view of their policies for complete transparency and on-the-go adjustments anytime.
 
With both customers and brokers now demanding these digital services, why are so few insurers able to deliver the necessary software? Typically, IT teams are consumed by legacy maintenance efforts, leaving few resources free to pursue digital business projects. They end up falling to the end of a long backlog, never to see the light of day.
 
Digital innovation requires the right people, process, and platform
 
The solution, many leading insurers are finding, is to adopt a two-speed IT approach. Traditional development teams continue to deliver and maintain core systems in a reliable, predictable, and safe way supporting existing IT. Small, integrated teams, iterating rapidly in response to changing business and market needs, on the other hand, deliver digital innovation projects.
 
What is important to recognize, though, is that this fast-track innovation approach requires a different mix of people, processes and platform compared traditional IT:
 
  • People – Create small, cross-functional teams, and facilitate active participation from business stakeholders throughout the project lifecycle.
  • Process – Encourage teams to work in short, iterative cycles in collaboration with end users. The key is to focus on one idea at time, creating functionality, releasing it, getting feedback, and iterating toward the right solution.
  • Platform – Augment existing toolsets with cloud application platforms, which enable faster, more flexible delivery of innovative applications. They bring together visual application development, agile project management, one-click deployment, and more, eliminating the constraints of traditional tools.
 
There are many positive outcomes from creating new applications to support brokers and digitize customer engagement. Insurers have the ability to make quick updates without sacrificing the IT resources required for day-to-day operations, and customers have quicker, easier access to the information they need. Brokers may benefit the most as they reap increased premium volumes and greater customer loyalty.
 
To get there, insurers must augment their existing IT with a software delivery approach designed to accelerate digital innovation. This allows you to quickly move the business forward without disrupting your existing IT systems and processes.
 
 
 

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