- 15 June 2018 12:11
Three ways insurers can compete against new market entrants
Every industry experiences the threat of competition. The insurance industry certainly isn’t excluded from that threat, which brings trepidation to the established carriers who have experienced competitive pressures in this highly competitive and regulated industry. The likelihood of new entrants urges established insurers to determine the best way to differentiate themselves and their services.
Evolution becomes imperative when competing with these new entrants in the market. When evaluating whether an organisation needs to embrace change to compete with more nimble and modern competitors, ask the following questions:
- Has the organisation embraced digital transformation?
- Is the organisation able to evaluate risks, underwrite new business and deliver policies in an efficient way?
- Is the organisation able to deliver fast and accurate decisions on claims?
- Is the organisation meeting customers’ needs in a timely and accurate manner?
If the answer any of these questions was no, it is time to evaluate the current business tools and processes utilised, and strategise about how to improve those processes to become more efficient, deliver higher quality interactions with customers and compete with new entrants. Often insurers find that by implementing the right technology strategy, they can embrace the changes needed to thrive against new competition.
The Tech Evolution
Not long ago, technologies such as image capture and document management were disrupting the way insurance organisations did business. Today those technologies are assumed for most organisations, and have continued to evolve as newer technologies like cloud, mobile and even drones are becoming more appealing for insurers looking to attract a new generation of customers.
Some of the most advanced and ambitious insurers have chosen to leverage a reliable, secure and flexible content services solution, utilising an enterprise content management (ECM) platform, because they see the agility it brings to their business strategy. What they may not have realised at the time was the on-going benefits they would achieve, even as the market changed, to help them prepare to compete against new entrants within the market.
There’s no need to panic if your organisation wasn’t at the forefront of selecting these types of technology applications years ago. Now is the perfect time to focus on developing a strategy that will carry the organisation into the next wave of technology innovations.
Here are three tips to help strategise and implement change to combat the threat that new entrants pose. 1- Embrace a true digital environment
It seems rudimentary to state this, but paper is expensive. Many organisations embraced technologies that eliminate paper long ago. However, those products may be antiquated and not provide the capabilities necessary to promote faster digital processes. Increasing expectations from customers for instant access to information require insurers to evaluate their technology stack to ensure that they have the tools necessary to meet and exceed customers’ expectations. This is the first step in the processes to give your customers what they want it, when they want it. 2- Look into processes that can be standardised through digital means
Embracing a digital environment is a critical first step, but only the beginning of the evolution needed to stay competitive. Once an organisation has achieved digitisation they should set the next goal of automating and standardising processes. More insurers are doing this by integrating best-of-breed solutions, including ECM, with claims and policy administration applications, to add functionality such as workflow, business process management, case management and records management.
By connecting systems where documents and data live to transactional processes, insurers create a true end-to-end digital environment with unified processes. This type of integration ensures faster processing, accurate information sharing between systems and comprehensive reporting capabilities to ensure they are meeting customers’ service standards and decreasing the chance of a competitor attracting those customers.
More recently, automation of many manual tasks has improved efficiencies and cut down on the chance of human error. Moving to an automated system allows an organisation to collate many disparate elements of a task in the one workflow, which reduces keystrokes, cuts the time taken to source information, and allows better collaboration on a job.
3- Improve Margins
There are a lot of complexities and added overheads that arise within insurance operations. By providing intuitive access to content and automating non-value add process steps, the time it takes to complete a process and come to a decision is greatly reduced. Thus, insurers are reducing the cost of performing those business functions while improving customer satisfaction. This gives their employees and agents the ability to focus on higher value tasks.
The added value of ECM is its flexibility to grow and expand to other departments to gain additional ROI. After an insurance organisation has achieved digitisation within one department, it can evaluate how to leverage similar results with other processes or departments to stop software sprawl.
Beating the competition New market entrants see the insurance market as an opportunity to bring innovation by building new product offerings. This revelation is leading insurers to re-evaluate their IT strategies because they see the direct correlation between strategic use of technology and better customer service. By leveraging best-of-breed systems, insurers can complete work in the most efficient way, leveraging integrated solutions that digitise and streamline processes.
The ability to provide great customer service on a consistent basis appeals to every generation, in every market. In such a competitive environment, insurers looking for an advantage need to focus on leveraging technology to eliminate paper, streamline and standardise processes, drive down costs and deliver exceptional service. True differentiation comes when the established players focus on what matters to their customers and couple their greater knowledge of the market with the right technology to outperform challengers, improve margins and create customer-centric offerings.