DIGITAL NEEDS TO BE A HYGIENE FACTOR FOR TODAY’S INSURERS
Top tips on how to implement digital initiatives
Embracing digital initiatives before customer expectations start to accelerate further is the only way to stay competitive in today’s insurance market-place, according to Mastek, the global IT solutions specialist for the insurance sector.
The insurance industry is experiencing a paradigm shift as digital natives increasingly demand a service that revolves around convenience, speed and ease. As a result, insurers need to focus on re-orientating operations to create a culture of digitalisation, customer-centricity and sharing of data and information. To help insurance organisations develop strategies that improve the customer experience and image of the industry, Mastek has identified a series of tips to guide businesses as they adopt digital initiatives.
Identify customer demands
Mastek recommends starting with the customer to understand how they want to engage with the products or services offered, before re-orientating operations to deliver this engagement. Multi-channel is quickly becoming the future of insurance and there needs to be a flexibility in the way providers engage with different groups of customers. Today’s customers are demanding mobile and web channels with straight through processing for claims and settlement processes. They want to be able to source insurance through market aggregators, submit claims online and receive information on settlements via email.
Definite ownership of ‘digital’
Digital is a very broad area that can cover customer interaction, straight through processing, self-service, big data and more. In addition, some organisations have multiple digital initiatives, which are moving at different paces. Insurance organisations need to ensure digitalisation is embedded into the overall business strategy and facilitates part of a joined-up customer journey. Taking a holistic approach to digitisation and ensuring seamless interaction across all stages of the customer engagement lifecycle – from the initial customer acquisition to account servicing – will enable traditional insurance providers to take incremental steps forward in capturing customers and creating a level playing field.
Develop bespoke digital services
Insurance providers need to establish their organisation’s current digital footprint and develop a high-level road map that identifies which parts of the business will benefit most from capital investment in IT initiatives. General insurance players are more focused on developing customer centricity through new business models and sales channels. In contrast, life and pensions players are more concerned with innovation in product designs and improving time-to-market, which are supported through the development of efficient underwriting profitability and risk management processes. For example, in health insurance there is a growing trend to collect data from wearable technology or gamified apps that monitor trends in customer’s health and collect data used to create tailored insurance policies.
Think about the future
Insurance providers need to become skilled at using digital platforms to reconfigure value changes in response to customer needs. Today’s online customers expect to be able to receive a quote and buy insurance products through the web, submit and track claims online or gain instant access to documentation over email. Whilst insurance providers might not see a huge demand for digital services today, this will change rapidly and the industry needs to be prepared before it enters a world of digital natives in the next ten years.
Commenting on the importance of digitalisation, Vinay Nagwekar, principal consultant for insurance at Mastek says: “Whilst digital may not be seen as an imperative for those within the insurance industry, it is still a hygiene factor and one that will grow in importance as the number of digital natives continues to rise. Many insurers are hindered by legacy systems and attitudes but new technologies enable creating tools, such as statistical patterns, to build new models for customer acquisition, retention, development and more importantly customer advocacy. The industry has been slow in recognising the need for digital innovation and it now needs to prioritise the development of engagement models that strike a balance between traditional distribution networks and emerging channels to maintain competitive advantage in an increasingly commoditised world.”