Industries worldwide have changed due to digital disruption. However, the insurance sector has remained almost the same for decades until the COVID-19 outbreak hit the world. Since then, more and more people are searching for health and life insurance policies through the internet, increasing digital disruption levels, commonly seen in retail and banking previously.
The pandemic has changed the way people see insurance. They have started understanding the importance of coverage and the repercussions of not having it. Meanwhile, the consequences of the outbreak have made insurers comprehend the importance of being technologically robust, advance, and innovative.
Personal computers and smartphones make it possible for buyers to access helpful information and tools to compare and buy insurance policies via a wide variety of platforms. Here, easy access to detailed information and transparency in prices are making it easier to sell complex insurance products that used to be sold exclusively through agents.
Concurrently, advanced technologies such as Big Data, Artificial Intelligence, and BlockChain are helping insurers produce new ways for potential buyers to buy insurance, focusing more on consumers’ requirements instead of the insurance companies’ need to sell policies.
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Solutions/Threads That Can Help Build a New Future of Insurance.
The Opportunity to Reach Masses Easily
Turning Change into Opportunity is emerging and ongoing social trends will reorganize/reconstruct traditional business patterns. The balance of power is slowly shifting to the consumer due to a rise in consumer expectations. Customers (that include both people and businesses) are demanding faster transactions, and more of them want to deal with insurance providers directly.
One of the reasons behind this shift is the rise in technology; smartphones are equipped with tools that help fulfill their demands. Here, insurers can use technology to target this new era audience and reach more and more prospects that are already looking for insurance policies through their mobile phones.
The Optimal Use of Big Data
As an insurer, you need to prepare yourself to become competitive in the industry because with technological developments.Your competitors are likely to have the same or similar opportunities that you and your firm are planning to capture. Big Data can help insurance professionals connect to the internet and analyze the abundance of data with ease.
To use this tremendously useful gift of technology, you will need to combine and analyze substantial amounts of data collected from customers. Utilizing some data analytics tools can help you enhance underwriting and pricing aspects. If you are willing to learn about the optimal use of big data for growth within the industry, you will be able to go one step ahead of your competitors.
Prediction of Catastrophic Events
Insurance professionals might have learned the importance of preparation from the recent coronavirus outbreak. They must be prepared to tackle challenges arisen out of any unforeseeable catastrophic events. Environmental events (for example, floods, natural fire breakouts, earthquakes, tsunamis, disastrous storms, etc.) are happening more frequently and becoming more severe.
Therefore, health, life, and property insurance professionals must look into research, surveys, and valuable information related to such events, such as regularly checking on climatic changes, air quality index, global warming updates, etc. This will help predict the severity and impact of such catastrophic events, further aiding in determining premiums.
Becoming Aware of Insurance Standards
There is a possibility of harmonization between insurance regulators across the globe. Creating a worldwide standard for insurance practices is likely to have a significant impact on policies and prices. Many national and international associations of insurers are working toward having a global standard of insurance to promote effective and consistent regulations in the industry to further maintain fair and stable markets for the protection of customers and the global economy. You need to stay updated about world events to be aware of insurance standardization.
Finding Possible Solutions to Deal with Staff Shortage
In recent years, the insurance industry has experienced a severe shortage of employees worldwide. One study says that 25% of the industry professionals are about to retire or have already retired, leaving a huge experience gap in a sector that is already short of the workforce. Such a significant discrepancy of professionals can limit insurers’ ability and speed to respond to claims, especially in the aftermath of a disastrous event (recent example – coronavirus outbreak) when the volume of claims suddenly rises.
Despite these challenges, many insurers use technologies such as artificial intelligence and robotic process automation to quicker the process. Those dealing with staff shortage are taking help from temp services, or insurance business process outsourcing services that offer resources on temporary or contract bases at affordable costs.
Shifting to Remote Work Options
In most countries, at least 50% of workers currently work from home or other locations provided by employers to work remotely. Yes, things have got pretty much normal, and governments worldwide have allowed reopening many business premises. However, to follow healthcare and government agencies’ guidelines for preventing the spread of the virus, many insurance companies are working remotely, and most employees are working from home.
Although it was a little difficult at the beginning, it is working well mostly. Insurance companies and agencies are equipped with sufficient computer systems, laptops, mobile devices to allow employees to continue to work from home and to connect with teams and leaders through video conferencing applications.
Still, there is an utter need to have a ‘remote work’ policy to ensure clear, effective, and uninterrupted communication between employees and specified principles to keep the work quality up to standards. Besides, communication between teams is vital to inform teammates about targets, priorities, and changes/developments in processes if there any be.
Offering More Contact Channels
Trillions of people are affected both directly and indirectly due to the COVID-19 outbreak, and this is the time to learn how to improve processes to make a stable future in insurance. Insurers understand that when a customer needs them, they call, but what if the number of queries is increasing day by day?
The quick response should be increasing the number of channels for customers to contact their insurers. Yes, amid a pandemic, none of your customers would be happy waiting hours to get connected to a support executive. With the increasing number of people of filing claims, they are calling their policy provider to enquire how to go about it, how much time it will take to complete the process, how much they will get as compensation, etc.
From late February, employment, travel, and health insurance queries have drastically increased as COVID-19 has affected these areas pretty hard. However, as customer queries increase, insurers can get more people for customer support. For instance, they can get the job done by contracting with an offshore company.
BPO and customer service expertise are plentiful in Asian countries, and these services can be acquired at affordable costs. Apart from that, the time zone difference makes it perfect for your customers to contact you around the clock. Such solutions can help you not lose a single customer that might otherwise go unattended.
Understanding Fraud & Cyber Security Risks
With the growing use of technology in insurance processes and the practice of remote working getting common in the future, there are several risks associated. The insurers’ job is not just protecting customers by providing them financial support,but also to protect their personal, confidential information that most insurers retain for an extended period.
There have been many cyber attacks in the previous years that target different sectors, but many times finance-related industries are cyber attackers/hackers’ top targets. It is high time to take all the required data security measures to protect customer information, company data, and reputation.
Suppose a business gets fobbed by online hackers. In that case, it hinders the company’s reputation in the market, further affecting customer’s trust and loyalty, leading to a reduction in customer retention rate.
Besides, customers may also file cases regarding the loss of their personal information, which can lead to costly payouts in the form of fines and penalties. Thus, to prevent this from happening in the future, insurers must take all suitable measures to make their servers and online data storage locations more secure using robust authentication protocols and tools.
Working Hard to Achieve Customer Satisfaction
It is a rough and challenging road that leads to customer satisfaction. Today’s consumers look for products online and prefer to make purchases through the internet using online payment modes. This explains most customers need convenience, firstly. Insurers can deliver their customers convenience, comfort by offering products at their doorstep (not literally), the new door is their smartphone screens.
The first stage that ensures customer satisfaction is the ease in finding a product; potential customers can visit your website and look for suitable policies. Adding to more reliability, you can add an option to compare different policies and a ‘buy now’ link through which they can make the purchase. By now, your customers are 50% satisfied; the other 50% depends upon how you handle them later on.
The two most significant factors contributing to better customer experience are transparency in claims processing and speed of claims settlement. The quicker these processes are handled, the more the customer is satisfied. By overseeing your customers’ entire journey and providing them with quality services, you can ensure business with them for longer terms.
Insurers need to focus on their end goals to retain growth in this sector. At the same time, they should be ready to face challenges coming the next few years and prepare themselves by finding opportunities out of problems. Customers invest in policies to secure their future.
Similarly, insurers need to invest time and effort in their insurance business that will pay off in the future. Where there are challenges, there are solutions too, therefore, continuously seek viable solutions to tackle any obstacle coming your way. For instance, offering self-service platforms for customers can reduce your workload and improve efficiency, productivity.
Encouraging millennials to work in insurance can solve the problem of staff shortage in the industry for decades to come. Allowing fast, secure, and easy-to-use communication channels to be in contact with policyholders can dramatically increase customer satisfaction and loyalty. All such solutions/thread can help build a new, better future of insurance.