Editorial & Advertiser Disclosure Global Banking And Finance Review is an independent publisher which offers News, information, Analysis, Opinion, Press Releases, Reviews, Research reports covering various economies, industries, products, services and companies. The content available on globalbankingandfinance.com is sourced by a mixture of different methods which is not limited to content produced and supplied by various staff writers, journalists, freelancers, individuals, organizations, companies, PR agencies Sponsored Posts etc. The information available on this website is purely for educational and informational purposes only. We cannot guarantee the accuracy or applicability of any of the information provided at globalbankingandfinance.com with respect to your individual or personal circumstances. Please seek professional advice from a qualified professional before making any financial decisions. Globalbankingandfinance.com also links to various third party websites and we cannot guarantee the accuracy or applicability of the information provided by third party websites. Links from various articles on our site to third party websites are a mixture of non-sponsored links and sponsored links. Only a very small fraction of the links which point to external websites are affiliate links. Some of the links which you may click on our website may link to various products and services from our partners who may compensate us if you buy a service or product or fill a form or install an app. This will not incur additional cost to you. A very few articles on our website are sponsored posts or paid advertorials. These are marked as sponsored posts at the bottom of each post. For avoidance of any doubts and to make it easier for you to differentiate sponsored or non-sponsored articles or links, you may consider all articles on our site or all links to external websites as sponsored . Please note that some of the services or products which we talk about carry a high level of risk and may not be suitable for everyone. These may be complex services or products and we request the readers to consider this purely from an educational standpoint. The information provided on this website is general in nature. Global Banking & Finance Review expressly disclaims any liability without any limitation which may arise directly or indirectly from the use of such information.

How insurers can make digital transformation a success

By Nagaraja Srivatsan, Executive Vice President and Chief Growth Officerat EXL

Insurance executives have three priorities: driving profitability, increasing customer engagement and dealing with the digital disruption affecting their business model.

To accomplish these goals, insurance companies are increasingly turning to digital transformation to improve performance and customer experience.

However, despite the investments and buzz around digital, transformation efforts are largely failing to achieve their goals. Earlier this year, EXL partnered with the Harvard Business Review to survey more than 800 executives around the world about their companies’ progress on digital transformation.We found that only a third of them had achieved significant results from their transformation initiatives. Insurance, specifically, lagged even further behind.

There are various reasons for this lack of success. Many insurers are hobbled by legacy systems, making it difficult for them to adopt new technologies. The survey data also shows that insurance companies are staying away from establishing centralized program management offices for their digital initiatives, leading to a piecemeal, siloed approach to transformation.

Each individual company will face its own unique roadblocks when pursuing digital transformation. However, there is an approach insurers can use to bridge the gap between digital expectations and results – Digital Intelligence. Applying Digital Intelligence means starting transformation with a focus on the outcomes, creating context by combining domain and data, and orchestrating people and technology to enhance results. It’s a strategic approach to digital that moves beyond viewing transformation as a technology problem to help insurers improve profitability, growth, and customer experience.

Focus on the outcomes

Nagaraja Srivatsan
Nagaraja Srivatsan

Getting digital right is paramount to success today. Companies that successfully transform place in the top quartile of their industries, and those that do not are threatened with disruption. In today’s environment, a company’s digital strategy needs to sit at the foundation of its overall corporate strategy.

However, the promise of digital has yet to be achieved, because digital transformation has primarily been driven by the creation of digital channels and the implementation of technology. Digital transformation is more than digital engagement and includes digitization across all industry processes. Technology plays a critical role in enabling change, but it does not guarantee transformation on its own.

Instead, companies need to start with the outcomes they want to achieve. Outcomes can include improvements in customer experience and more-intelligent execution, or business outcomes like revenue and profitability—but they must be quantified, and committed to up front, before digitization efforts are introduced. Beginning transformation with a firm grasp of the outcomes to be achieved improved one client’s claims management function by increasing first-call resolution by 32% and reducing cost-to-serve for claims FNOL by 30%.

Understand the context of your data through the lens of your industry

One of the challenges facing insurers in this area is that while a company may have strong domain expertise, they often lack data talent, skills, and available data to use. Or, they may have a combination of these facets, but don’t know how to get analyze the data to generate insights.

Delivering successful outcomes like improved customer experience and intelligent execution takes context, the combination of the right data with the right domain information. Insurance companies have already started turning to data to gain actionable insights for acquiring new customers as well as make underwriting and claims processing operations more efficient. This includes bringing together data analytics and automated workflow process can enable insurers to extract data from multiple sources that supports decision making and transforms the end-to-end claims process.

Context requires insurers to stop viewing data as an inherently useful resource in itself. Companies can have tremendous amounts of data on their customers, leads, and processes, but may not be able to generate actionable insights without the right approach to analysing this information. Instead, insurers must identify the data relevant for the outcome they are trying to achieve using their domain expertise, and use advanced analytics to power their decisions with data. Applying this approach when improving one client’s lead generation programs lead to an increase of $100M in annually written premiums, 250M+ quotes, and a 38% reduction in direct to consumer acquisition.

Orchestrate your people and digital technology to achieve your goals 

Insurers are beginning to invest in automation and analytics with the goal of making their operations more efficient and improving customer engagement and experience by aligning the front, middle and back office. Through intelligent workflow processes in areas such as claims routing or underwriter assignment, insurers can use technology to reduce manual, time-intensive tasks and redirect employee focus onto value-generating tasks.

Even with the rapid pace of technology advancement across areas like robotics, AI, and analytics, no single tool results in digital success. Instead, multiple technologies must be orchestrated together in the right combination with the right human interventions to improve business outcomes.

For an example of what this might look like, consider a digitally transformed FNOL process:

  • First contact into the front office via digital channels such as claim reporting features inside mobile apps, which are increasingly common.
  • A transformed claims workflow than includes investigation, evaluation and settlement with process cost analytics to improve decision making, with additional advanced capabilities to identify potential fraud.
  • A transformed back office that automatically fast tracks claims that meet specific criteria using robotic process automation, workflow tools, machine learning and cognition, and then routes exceptions to claims experts.

When orchestrated together with claims teams, these interventions improve capacity, cycle time, settlements and fraud detection, which can make a difference both for individual customers, as well as for insurers responding to the volumes of claims that follow a disaster. We’ve seen digital interventions, such as automated workflows, intelligence information extraction, judgment-based processing and cognition-embedded decision making improve FNOL process efficiency 30-35%, fraud detection by 20-25%, spot settlement by 5-10% and 2-5% better utilization of claims adjusters and special investigation units.

Digital Intelligence: The future of insurance transformation

Insurers don’t just need to digitally transform in order to remain competitive and avoid disruption – they need to transform successfully. By bringing together data and domain expertise to create context and orchestrating digital interventions with human workers to enhance processes, insurers can achieve the outcomes like improving customer experience and profitability. Digital Intelligence enables insurance companies to overcome obstacles to transformation and turn their digital expectations into results.