How intelligent automation is paving the way for a new era in the insurance industry

Jerry Wallis, Head of Industry Strategy, SS&C Blue Prism 

The insurance sector has faced a perfect storm of events these past few years. The covid-19 pandemic accelerated digital transformation around the world – which had the added effect of contributing to increased customer expectations and a surge in competitive pressures.  In addition, many long-established insurers have to maintain legacy systems that support books of insurance that can be years, even decades old – and that cannot easily and cost-effectively be replaced.  Having customer data stored in multiple different systems makes it very difficult for an insurer to build a single 360-degree view of a customer, to serve them better and to sell them more. 

While businesses in various industries have sped up their digital transformations to meet the demands of an online world, the tie to these legacy silos has meant the insurance industry has historically been slow to move into a truly digital way or working.  . The average underwriter, for instance, continues to spend more than 50% of their workday on repetitive tasks.

The sector is under tremendous pressure to process information faster, better, and cheaper to meet the changing needs of today’s customers and secure long-term competitiveness. The adoption of advanced technologies, namely intelligent automation (IA), is helping insurers overcome this challenge by changing how the industry operates across every aspect of the value chain – from product development, underwriting, and policy management, to claims and other processes.

This piece will explore how intelligent automation is launching a new era of improved productivity in the insurance industry.

Digital transformation and IA are imperative to insurers’ future prosperity

The rise of intelligent automation has brought about a new era of possibilities for the insurance industry, with an impressive range of benefits. The introduction of IA and its respective technologies into an insurance firm represents the future of what can become a much more technologically advanced sector. This is particularly important as the industry is under increasing pressure to not only reduce costs but to also maintain, and take steps to improve, customer satisfaction.

Intelligent automation adoption can help resolve this by unifying disparate silos of data, presenting users with a single, digitally capable view of customers, thus giving them the time they need to focus on complex customer cases and the ability to utilize IA to deliver superior, bespoke customer service. IA is a combination of components, including artificial intelligence (AI), robotic process automation (RPA), business process management and other complementary technologies that enable companies to advance workflows and streamline end-to-end processes.   

Digital labour helps workers by automating repetitive and mundane tasks, freeing people from repetitive and time-consuming work. Digital workers connect to legacy or modern applications to automate business processes through a variety of automation techniques.  .

Intelligent document processing allows insurance firms to process vast amounts of data with minimal human intervention at an over 98% rate of accuracy. This replaces laborious and error-prone data entry, which is not only slow but creates an inefficient and costly domino effect when information is input incorrectly. Artificial intelligence components can then use this information to provide valuable insights, predictive analytics and modeling regarding customers and their policies, and suggestions for optimizing processes.

Business process management provides digital oversight, enabling employees to know exactly where in the workflow items are and what needs to be completed to get tasks to completion. Intelligent process mining identifies areas that would benefit from automation, transforming the end-to-end processing of work.

Overall, these and other advanced IA technologies work together to streamline business processes, reduce operational costs, and improve the accuracy and speed of services. Using IA delivers key benefits for insurance firms, which include:

Faster claims processing – IA can automate many of the tasks involved in processing insurance claims. For example, it can read and analyze claims documents (including handwritten documents), determine whether a claim is valid, and calculate the amount of compensation owed. This can help insurers process claims more quickly, reducing the time it takes for customers to receive their payouts.

Improved customer service – The introduction of chatbots powered by natural language processing can answer customer queries and resolve simple issues. This frees up customer service representatives to focus on more complex issues, improving overall service levels. Predictive analytics help workers identify customer needs and preferences to better personalize products and services. Automated notifications can be used to notify customers of policy renewals, claim status updates, and other important information. This can help improve customer satisfaction by keeping them informed in real time.

Better risk assessment – By analyzing large amounts of data, the AI features of intelligent automation can identify patterns and make predictions about future events as well as customers. This can help insurers to price policies more accurately and avoid underwriting risks that may otherwise be too high.

More efficient underwriting – By automating tasks involved in underwriting policies, insurers can improve efficiencies and productivity. For example, IA can analyze customer data to determine their risk profile, check for policy compliance, and generate policy documents. BPM ensures the underwriting process moves along to completion efficiently. This efficiency reduces the time and costs involved in underwriting policies, allowing insurers to process more policies in less time.

Enhanced fraud detection – By analyzing large amounts of data, intelligent automation’s AI capabilities can identify patterns and anomalies that may indicate fraudulent behavior. This can help insurers detect and prevent fraud before it occurs, reducing the amount of money lost to fraud.

Insurers can build thriving workforces in the age of IA                                     

Another benefit of introducing IA is that insurers can develop and improve their workers’ skillsets to match the needs of an increasingly digitalized world. Insurers can also recruit new talent that is interested in learning about advanced technology. Team members that were once spending their days completing repetitive, time-consuming tasks, can be trained in the latest IA technologies to establish them as customer-focused underwriters.

Improvements in efficiency, skillsets, and recruitment help insurers build stronger workforces.

Intelligent automation is for all sector players

Don’t make the mistake of assuming the benefits of IA are confined to the big-league, multinational, insurance players. Intelligent automation is for all in the industry– from agencies and specialty insurers to regional insurers and – yes – multinationals.

For small and mid-sized players, intelligent automation presents an opportunity to overcome staffing and scale challenges to effectively compete in the marketplace and, thus, optimize revenue. Not only does IA improve efficiencies but it can also help insurers innovate and develop new products and services more quickly and effectively, allowing them to stay ahead of the competition and meet the evolving needs of their customers. But to be successful, businesses need to make digital transformation a strategic priority. For those that do, they will prove their ability to adapt to a rapidly evolving market and ensure their future growth.

“The rise and introduction of intelligent automation has brought about a new era of possibilities for the insurance industry. The gradual adoption of IA technologies into an insurance firm represents the future of what can become a much more technologically advanced sector. The adoption of AI and IA technologies is help insurers overcome this challenge by changing how the industry operates across every aspect of the value chain – from product development, underwriting and policy management, to claims and other processes.

“IA is a combination of components, including artificial intelligence (AI), robotic process automation (RPA), business process management and other complementary technologies that enable companies to advance workflows and streamline end-to-end processes. Digital labour helps workers by automating repetitive and mundane tasks, freeing people from repetitive and time-consuming work. Digital workers connect to legacy or modern applications to automate business processes through a variety of automation techniques.  For instance, intelligent document processing, improved customer service via chatbots, better risk assessment with AI features of automation identifying patterns and predictions, enhanced fraud detection and efficient underwriting. AI and IA will redefine processes within the insurance industry, but also help insurers innovate and develop new products and services quickly and effectively, putting them ahead of competitors and allowing them to and meet the evolving needs of their customers.”