This submit is a part of a collection sponsored by AgentSync.
Across the insurance coverage distribution channel, everybody from the most important carriers to particular person insurance coverage shoppers have witnessed a “digital transformation” to some extent prior to now three years. We’ve seen it by way of a rising variety of insurance coverage know-how firms, an elevated funding in software program (each inside and buyer going through), and new developments in automating beforehand handbook components of the insurance coverage underwriting course of – simply to call a number of examples.
COVID-19 hasn’t disappeared, however the world has began to resemble pre-pandemic occasions in some ways. While some issues are returning to how they have been earlier than COVID, the technological leap ahead we see within the insurance coverage business isn’t one thing that may revert, nor would we would like it to! On the opposite, it seems that COVID-19 helped the insurance coverage business hit the gasoline pedal on modernizing work practices, buyer expertise, and operational effectivity.
As we strategy the three-year mark of when the world principally shut down, we needed to take a look at what sorts of adjustments COVID delivered to the insurance coverage business, and in the event that they’re right here to remain.
The insurance coverage business has been making an attempt to place its quaint, low-tech popularity behind it lengthy earlier than anybody heard the phrase “COVID-19.” Whether that’s by way of an ever-growing listing of insurtechs (backed by billions of {dollars} per yr of enterprise capital), or by legacy insurers and brokers making an attempt to enchantment to a brand new technology (each of clients and staff), the dialog about modernizing insurance coverage isn’t a brand new one.
Despite decades-long efforts, and incremental enhancements, the insurance coverage business in 2019 regarded surprisingly just like what it had 10 and even 20 years prior. Many insurers and insurance coverage businesses massive and small nonetheless required staff to work from centralized workplace areas and relied on spreadsheets, shared community drives, in-person conferences, moist signatures, and exhausting copies to conduct enterprise. Then, a pandemic occurred and the world needed to regulate actually in a single day. Organizations that had already invested in additional digital instruments have been forward of the curve, however in the end, each insurance coverage group needed to develop into extra fashionable to outlive.
Ask anybody who’s labored at an insurance coverage service, company, MGA or MGU, FMO, IMO, BGA, or every other insurance coverage enterprise: Most doubtless, they’ll let you know about working in an workplace and counting on handbook processes to get issues performed. Day-to-day actions included cellphone calls, in-person conferences, visiting consumer areas, dinners and drinks with prospects and shoppers, and plenty and many typing data into paperwork throughout a number of methods.
Depending on the person group and its degree of digital sophistication, staff could have relied strictly on e mail for digital communications or they might have had skype or one other sort of immediate messaging. Many insurance coverage businesses had company administration methods, however many additionally managed their enterprise utilizing spreadsheets and even paper paperwork.
Insurance carriers earlier than COVID-19
Before the COVID-19 pandemic, insurance coverage carriers have been already utilizing quite a lot of applied sciences to automate and streamline their operations. It was 2019, not the stone ages, in any case! Examples of know-how insurance coverage carriers typically employed included software program to deal with coverage underwriting and claims processing, in addition to using information analytics to higher perceive buyer wants and threat profiles.
Insurance carriers have been additionally beginning to undertake newer applied sciences, reminiscent of synthetic intelligence (AI) and machine studying (ML), to enhance their operations. The largest and most tech-savvy insurance coverage carriers have been utilizing know-how to investigate massive quantities of information and determine patterns and tendencies that would assist them make higher knowledgeable choices about threat evaluation and coverage pricing. On the customer-facing facet, they have been additionally utilizing digital platforms and instruments to work together with clients and distribute their merchandise. This included using on-line portals and cell apps to permit clients to buy insurance policies, make funds, and file claims.
Still, in a late 2020 interview with Brandon Carter, President of USAA Life Insurance Company, Carter reveals the extent to which USAA was entrenched in additional dated practices previous to the pandemic. For instance, Carter says that 90 % of the insurer’s then 35,000 staff labored out of an workplace location. And, as is widespread in life insurance coverage, all candidates wanted an in-person medical examination earlier than their insurance coverage might undergo underwriting. These are a few areas that may see an enormous overhaul largely as a result of strain USAA felt from the impacts of COVID-19.
Insurance businesses and brokerages earlier than COVID-19
According to 1 company worker we spoke with, previous to COVID all 30 members of the company’s workers labored from the workplace full time and had desktop PCs. The company needed to develop however struggled to draw the most effective expertise as a result of they have been restricted to hiring regionally, since they required in-office work. In phrases of operational tech, the company had Outlook for his or her e mail and Skype for interoffice immediate messaging. They had an company administration system, however no different types of automation or know-how to talk of (automated producer compliance administration, for instance).
This story isn’t distinctive. From firsthand expertise, and from talking with producers and account managers at quite a lot of insurance coverage businesses, working from a central workplace location was typically non-negotiable earlier than March, 2020. Insurance brokers carried out most of their enterprise in-person by touring to consumer areas or internet hosting prospects and shoppers at their workplace. Thus, the quantity of know-how in place to facilitate actual time digital communication and collaboration between workers and shoppers was minimal.
In March of 2020, most U.S. workplaces shifted as many staff as doable to distant work. Only important companies like hospitals, police departments, and grocery shops stored workers coming to their bodily working areas. As very important as our bodies in chairs had appeared to many insurance coverage business professionals, the reality was that just about each member of the insurance coverage distribution channel might work simply as successfully from house – with the fitting instruments to help.
Digitization at insurance coverage carriers throughout the pandemic
In an interview from late 2020, Brandon Carter, President of USAA Life Insurance Company remarked that lower than 2 % of his workforce remained within the workplace, in comparison with 90 % earlier than COVID. He additionally stated that his staff had maintained their extraordinarily excessive ranges of buyer satisfaction all through 2020, proving that almost all of USAA’s insurance coverage staff might do their jobs from house simply in addition to in an workplace.
At the identical time, COVID introduced alongside increased demand for private strains insurance coverage merchandise like life and medical insurance, in keeping with a research revealed within the journal Procedia Computer Science by Dariusz Pauch and Anna Bera. The increased demand for these merchandise meant insurance coverage enterprise was booming and competitors between carriers to supply the most effective buyer expertise – and the most effective expertise to their downstream distribution companions – grew to become much more necessary.
Other areas of digitization and modernization Carter spoke about implementing at USAA attributable to COVID-19 embrace:
- Shifting extra assets to making a option to automate life insurance coverage underwriting utilizing individuals’s medical information and “big data” as a substitute of an in-person medical examination.
- Looking at cell apps like Uber and Amazon for create a frictionless buyer expertise for individuals wanting to buy life insurance coverage.
- Taking a web page from consumer-favorite manufacturers’ books when it got here to re-engaging with clients after the preliminary buy (e.g. newsletters, surveys, reminders, outreach).
USAA is only one instance of what was taking place at insurance coverage carriers throughout the peak of the COVID-19 pandemic to shortly shift to safer, socially-distanced, and digital operations. Conveniently, adopting these practices is what insurance coverage shoppers had been hoping for all alongside, which can have contributed to increased earnings (each in life, well being, and P&C) within the yr following pandemic-induced digitization.
Digitization at insurance coverage businesses and brokerages throughout the pandemic
Insurance businesses weren’t utterly with out some fashionable know-how on the finish of 2019, however they have been largely office-based and will have used simply the fundamentals like e mail and inside immediate messaging. According to an AgentSync buyer we spoke with, her company jumped into motion as quickly because the COVID lockdowns began and obtained laptops for each worker, the place most had been tied to desktop PCs beforehand.
With all the company’s staff working from house, management was shocked to see that nearly everybody thrived within the distant setting. This is a standard story: Agencies pressured to go distant by the virus have been shocked that productiveness, earnings, and consumer service didn’t undergo.
However, some individuals, together with this company’s leaders, missed the group of being collectively in particular person. Around September 2020, they began having individuals are available in on designated days, for instance business strains workers on particular days and private strains workers on others. This compromise allowed these craving their outdated fashion of labor an opportunity to take action in a safer manner throughout the pandemic. At the identical time, most individuals have been nonetheless working remotely the vast majority of the week. It was at this level that the company invested in new tech instruments like Office365, Microsoft Teams, and Zoom to allow continued collaboration and productiveness with its newly hybrid workforce.
Another growth that caught was the “COVID casual” gown code. Where this company’s staff had been required to put on enterprise informal gown whereas they labored within the workplace full time previous to COVID, management acknowledged that insurance coverage workers working at their desks might just do as effectively carrying no matter they have been comfy in. While not a technological enchancment, this modernization speaks to an general evolving tradition on the company.
The company additionally underwent a hiring growth in 2021 and 2022, thanks partially to its modernized tradition and the power to decide on expertise from anyplace within the U.S. As of early 2023, the company has created one other “sister agency,” employed over 30 new staff (lots of whom are solely distant), and continues to put money into know-how – like AgentSync – that creates extra time for employees to do their most respected work whereas know-how does the remaining.
It’s March, 2023 and life appears to be like very completely different from three years in the past in virtually each manner possible. For some individuals, your entire COVID period has pale into the background, and so they stay their lives as if nothing occurred. For others, incorporating COVID security protocols into their each day lives has develop into the “new normal.”
For the insurance coverage business, we’ve obtained our personal “new normal” and that features a degree of know-how utilization and digitization by no means earlier than seen. Like toothpaste that may’t be put again into the tube, insurance coverage professionals have seen a unique manner of working that’s an enchancment over “the way it’s always been done” for a lot of, and so they don’t wish to return.
The digital influence of COVID-19 at insurance coverage carriers three years later
According to a 2021 insurance coverage CEO outlook survey carried out by KPMG, 96 % of insurance coverage CEOs attribute their firms accelerated uptake of digital working fashions to strain from the COVID-19 pandemic. Across the board, these insurance coverage digitization efforts seem to fall primarily into 4 areas.
Customer expertise
Insurance carriers largely notice that there’s no going again to the outdated days of shoppers simply taking what they might get. People purchasing for insurance coverage have so many decisions at their fingertips and may typically use their cell phone to get immediate quotes from a number of insurers on-line.
Consumers’ expectations didn’t simply change in 2020 however insurers’ response to them did. KPMG’s survey confirmed that 50 % of insurance coverage CEOs say the pandemic so dramatically accelerated their race to create a seamless digital shopper expertise that they’re now years forward of the place they anticipated to be earlier than COVID got here onto the scene.
At USAA Life Insurance Company, which has at all times prided itself on being a frontrunner in digitizing the shopper expertise in keeping with president Brandon Carter, buyer expertise and buyer satisfaction are central to success. In the years for the reason that pandemic began, USAA Life Insurance Company has continued to look to non-insurance apps for inspiration on making a constructive digital expertise together with: digital channels for buyer interplay, digital instruments for outreach and re-engagement, and digital claims dealing with to make the expertise as seamless as doable.
Employee expertise
In an business that faces a largely ageing and retiring workforce, and a lack of adequate new expertise coming in to fill these roles, worker expertise is a serious alternative for insurers to leverage digitization to their benefit. And for the reason that begin of COVID-19, insurers have stepped as much as the problem. The USAA Life Insurance Company’s transformation from 90 % in-office to 98 % distant employees illustrates the entire 180 that many insurance coverage carriers have been by way of. Insurance carriers have additionally put emphasis on worker expertise by investing extra in digital instruments that ease staff’ burdens and allow them to concentrate on the work they wish to be doing.
Automating repetitive duties
According to Brandon Carter, President of USAA Life Insurance Company, essentially the most pure place for insurers to proceed evolving is within the automation of mundane processes. We occur to agree! For any insurer making an attempt to cut back prices and stop worker turnover, getting software program to tackle repetitive and mundane duties as a substitute of individuals is a win/win. Sidenote: If considered one of these duties occurs to be manually monitoring and verifying producer license and appointment standing, AgentSync has some nice information for you.
Scaling resolution making by way of synthetic intelligence (AI)
Artificial intelligence is getting a variety of consideration nowadays, and it’s exhausting to know what’s going to be impactful and what’s simply hype. For insurers, AI presents a really actual alternative to scale resolution making that was as soon as solely doable by people.
For instance, insurers can dramatically pace up underwriting and claims processing by taking data that’s traditionally been saved inside staff’ minds and creating resolution frameworks that may settle for large information inputs and output choices at a pace tens of millions of occasions sooner than a human. If performed effectively, scaling resolution making by way of AI will unencumber individuals to do extra high-impact work whereas concurrently pleasing clients with exceptional pace in coverage underwriting and claims cost.
The digital influence of COVID-19 at insurance coverage businesses and brokerages three years later
Most insurance coverage businesses don’t have the identical sort of assets at their disposal as an insurance coverage service. For them, the lasting impacts of digitization from COVID-19 appear to be principally in worker expertise and the way in which they serve shoppers.
Of course, worker expertise is under no circumstances unrelated to implementing know-how that makes everybody’s jobs simpler by automating repetitive duties, or just offering a contemporary expertise. Agencies that had beforehand labored out of a single workplace location could have instantly realized the advantages of a cloud-based software program for his or her company administration system when it by no means appeared obligatory earlier than. They could have additionally instantly realized the magic of a Zoom account to maintain brokers and CSRs in touch with shoppers and inside companions.
For the company we spoke with, the impacts of their COVID-19 digital transformation are nonetheless obvious and ongoing. The workforce is nearly solely distant or hybrid with solely a few staff working from the workplace full time. After seeing the efficiencies introduced on by upgrading to extra fashionable communication options, the company started making use of this digital mindset to different components of the enterprise – ultimately implementing AgentSync to automate producer license compliance. Since the beginning of COVID, the company has doubled its worker headcount and loved increased revenues as a result of staff are capable of work when and the way they work greatest, with the know-how to assist them do it.
No one will argue that COVID-19 was a “good thing” however it did present the motivation the insurance coverage business wanted to embrace some lengthy overdue adjustments.
Regardless of the place you might be in your digital journey, AgentSync may help you simplify producer license compliance, service appointments, producer onboarding and offboarding, and extra. Get in contact with us right now to find out how.