Insurance carriers have to adapt to continue to appeal to their current and new customers. We look at a few ways the insurance industry can use digital innovation to keep up with expectations.

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Innovation has become the key to success for commercial insurance companies. Traditionally, commercial insurance carriers have been slow adapters to new technologies and trends. Most significantly, digital transformation has seen slow adoption due to highly regulated and complex products as well as an agent and broker-dominated sales model.

As the expectations and demands of both agents, brokers and insureds change, the pace of progress has accelerated in the commercial insurance space. Additionally, the accessibility of digital solutions tailored for commercial products has increased. What was once considered experimental innovation has become table stakes. Insurance carriers are racing to adopt digital solutions and striving to simplify how agents and brokers engage with them while seeking to improve efficiency and profitability. In part one of our two-part series on embracing digital innovation due to changing customer expectations, we’ll cover these dynamics from the perspective of the carrier and explain why digital has become a point of emphasis for the industry, and how carriers can embrace it.

Rising Digital Expectations

We’ve seen for some time that Personal Lines Insurance customers are used to getting everything they want in a few clicks or taps. More recently, we’ve seen those same expectations carry over to Commercial Lines. Both Agents and Brokers and insureds have higher expectations for working digitally. The seamless digital experience they expect now includes on-demand products and services, accessibility, product diversity and ease of use. Digital transformation has become critical to staying competitive as well as retaining and acquiring customers. As a result, insurance carriers have been working to transform their digital space by creating self-service tools and customer portals, mapping out customer journeys, and expanding their digital options and offerings at unprecedented rates.

Increasing Process Efficiency

Along with engaging customers and agents, carriers are feeling the pressure to be more efficient. Insureds find the long cycle times and slow claims processes in the insurance industry to be unacceptable – they have grown accustomed to completing tasks digitally and seamlessly in so many other aspects of their lives. Carriers who struggle with the complexity of their legacy systems and time-consuming process are taking this opportunity to incorporate the latest digital-focused technologies into key areas of the insurance value chain. Digital innovations that are primed for insurance use cases are allowing carriers to accelerate their claims and underwriting efficiency, compliance and productivity. Here are some innovations carriers are embracing to reduce complexity and increase speed:

• Improved claims documentation and submission applications that minimize the “back and forth,” saving employees and customers time and frustration.
• Enhanced data analytics that provide insights on customer inputs and identify actionable opportunities.
• Easy-to-use AI software that can free up insurance workers, cut costs and drive growth by automating many aspects of the insurance process, including risks assessment, fraud identification, and underwriting
• CRM and digital vendors that embrace insurance use-cases, enabling carriers to implement customer-focused digital imperatives and streamline their customer journeys.

Partnering with InsurTechs

To embrace the customer-fueled digital shift and stay competitive, many carriers are turning to InsurTech partners to achieve their goals. These partnerships are often seen as a “win-win proposition” for both sides as established carriers can harness their customer data and relationships while InsurTechs provide the technology and support to solve problems specific to one area in the value chain. The biggest challenge for insurance carriers is that they need to prioritize what areas they need to evolve first for their customers, figure out the best InsurTech partners, pinpoint solutions and incorporate them into their overall business processes.

Focus on Providing Tailored Services

On top of improving their digital services, carriers are feeling pressure from their customers to provide well-priced, custom-tailored policies that cover expanding and emerging risks – which has been the case with business interruption coverages such as cybersecurity and COVID risks. Carriers are racing to provide new products that cover these risks and do it profitably. As a result, they will need to have a strong digital foundation that allows them to track and monitor these products and quickly adjust pricing, ratings and filings as needed. Small and large businesses are now hyperaware of what they package in their business interruption policies, so insurance carriers must market themselves appropriately, go to market with their new products and price them right to stand out to new and existing customers.

Conclusion

Insurance customer expectations have always changed over time. Today’s agents and insureds are digital natives who expect fast, on-demand and personalized service. Innovation and digital transformation continue to evolve, and the pace is only accelerating. Embracing the digital shift, optimizing process efficiency and prioritizing operational agility should be top of mind for insurance carriers as they aim to improve customer experience and prevent themselves from slipping behind. Key digital imperatives that focus on agent engagement through portals and sophisticated marketing techniques targeted at agents, combined with an emphasis on CRM tooling that leverages InsurTech solutions will be the path forward. Insurance carriers that adopt these solutions will both increase market share with their desired customer base and improve efficiency. This will result in more meaningful agent interactions that will position them as the carrier of choice for agents. In the final blog of this two-part series on embracing digital innovation in insurance, we’ll cover these dynamics from the perspective of the agents and brokers and provide insight into what agents and brokers can do to best navigate these industry trends.