There is a radical change happening in insurance in the last few years. It revolves around the race to zero – or, the concept of streamlining the end consumer experience to ask less and less information when the time comes to file and process claims.
Regardless of what stage from the digital transformation journey the has been in, meeting and exceeding customer expectations has always been important – as has been your way to locate smarter methods to do business. Without either of these things, not many organizations would be successful.
Asking much less from consumers isn't necessarily a new concept – but that doesn't mean that it's not more essential than ever in 2021.
In 2021, not just may be the race to zero more possible than ever before (because of improvements in software-as-a-service (SaaS), digital technologies and knowledge ecosystems), it's becoming an expectation.
This is basically being driven by two things: new generations of digitally native consumers who're used to seamless data integrations and knowledge access across every aspect of their lives; and organizations looking for ways to evolve their ways to work smarter and more efficiently to satisfy these expectations whilst remaining profitable.
Whether every type of insurance or business type could possibly get to these hypothetical zero inputs does not matter. What's important is that the new world of SaaS-based solutions, along with a transformation to data-driven ecosystems living in the cloud, are changing the insurance coverage game at speeds we've not experienced before.
Whatever that limit is, here are some ways in which any business can realize its potential:
Enable Continuing Improvements With SaaS
It really was only 5 years ago that we started seeing early adopters embrace SaaS – and just in the last year or so that there's been a drastic change wherein nearly all are heading toward that model. Among the chief reasons for this is actually the configurability and malleability of new SaaS systems compared with legacy systems.
Insurance is driven by data; however, previously, as insurers would get new data feeds, it was difficult to take advantage of them in a timely fashion – because existing systems and procedures were so locked in. Now, with modern SaaS systems, it's quicker to make changes to processes, workflows and rules, so when new types of data and analytics tools become available they are utilized to your benefit – and also to the benefit of insureds.
Avoid Limiting the Value of New Data
Data is golden – but pouring new data into a classic process often doesn't get you where you need to go or get the processes any nearer to the hypothetical zero. Instead, we should be considering new data sets in new ways and imagining how they may actually affect or drive a new process.
This isn't any easy feat, and what we've seen some carriers do (innovate while understanding the legacy processes within existing organizations) is start companies or build new insurance products. This freedom to innovate, and keep data outside existing core systems, means the data's value isn't limited inside a legacy environment where it's easy to get caught up.
This sort of innovation remains one of the most interesting recent developments – and can still evolve as insurers look to create data-driven items that change the way insureds engage with insurers. The marketplace has reacted to enable this evolution with highly customizable, out-of-the-box SaaS solutions built around configurability and speed.
Think Agility
When it comes to meeting this hypothetical zero in a new data-driven world, we should also consider IT processes – and the agility that is required to maneuver to market at speed. Things used to take a long time (new products released with an annual or multi-year basis, for instance). However, with new, low-code core systems, insurers can be quite agile about how and when products are released – and the types of data sources or third-party integrations that can be leveraged in a manner that constitutes a competitive improvement in the marketplace.
This could be a challenge for this departments that aren't used to working in this manner, therefore the mindset truly needs to shift toward “agility.” It goes for updates too. If there are possibilities to prefill through partnerships and integrations, or feed in new data sets, insurers leveraging new systems and processes can certainly modify an application or existing product.
Use Data to create Better Decisions
We've talked a great deal concerning how to be agile and think about new ways to access data and knowledge – and reimagine your processes around it. But, once you have that information, there's another half of the equation you must consider – can one make better decisions and employ the best information and tools, such as analytics or scores, to route things appropriately as well as for easy cases?
From the front end, if I'm using data prefill and getting better data that I may have from older forms, for example, how can this bring about making better, more informed and faster decisions in the insurance process? Taking this one step further, during periods of strain or circumstances where losses stack up, can my organization find possibilities to use data and prefill to provide straight-through processing and let our workforce to focus its efforts on the harder and nuanced cases that require a very hands-on, tailored approach?
If the end result isn't better decisions, the value of more data often isn't realized.
Think Open yet Secure
A final point worth noting is the transition to some more open, API-based ecosystem in insurance. Traditionally, the industry continues to be highly closed off, but we're seeing more and more negotiations around how to access and build around APIs. With this transition to “openness” (along with a shift in mindset for the whole industry), innovation may take strides, and the race to zero for insureds and insurers gets to be more of a reality.
The core worth of insurance will still be worth its weight in gold, but imagine the kinds of solutions we are able to develop with an abundance of recent information, new processes and technology in place.
For anyone within the insurance industry looking over this, how do you not get excited about the options in front of us? A new world of opportunity awaits within the race to zero – in terms of how we reimagine products and policies for consumers and just how we operate and process internally.
For those of you not involved with this data-driven insurance technology ecosystem – what are you awaiting?
