Exploring the Impact of Automation on Insurance
An interview with Duck Creek Sales Director, David Neville
TCG Process Australia invited Duck Creek Sales Director, David Neville, to discuss the importance of digital innovation for insurance providers, strategies for enhancing customer experience and the challenges insurers face in digital transformation efforts.
How important is digital transformation to the future of providers in the insurance industry?
There are varying views on what digital transformation is, but overall digital transformation is extremely important for the entire insurance industry as it will lead to significant improvements in customer acquisition, satisfaction and retention.
Digital transformation includes things like the automation of manual processes, the enhancement of self-service via digital channels and improved access to data leading to more insights and better decision-making.
Customers are increasingly wanting personalized insurance products and services from the brands they buy from, as well as convenient and fast experiences on their terms. Digital transformation is one of the key drivers that will help insurers and other providers deliver this, at scale and at a lower cost.
Where do you think the industry is /what is the state of digital transformation?
Whilst insurers understand the value of digital transformation and are making great strides to achieve being truly digital, the insurance industry still has a long journey ahead of it when compared to other industries such as retail banking.
One of the restrictions hindering progress is the legacy technology that many providers are persisting with. These systems are often decades old and are brought up to standard with add-ons. But at their heart, they’re more analogue than digital. This also creates a Frankenstein’s Monster situation where these systems become a mash of odd parts, are complex and prone to breaking. Not only is this expensive to operate, but also expensive to maintain.
Newer, start-up insurers tend to be un-shackled by these issues and able to build true digital customer and operational staff journeys from the outset. Argyle Insurance is a great example of this.
The technology to achieve a true digital transformation is available and the benefits are very attainable, it is more of a question of how insurers transition away from their legacy technology. There are solutions out there that make this a less difficult journey.
What do you feel is required to deliver a winning customer experience?
A winning customer experience involves allowing the customer to interact with their insurer when and how they want. Enriching self-service channels with digital capabilities is critical and has been for some time now, yet it is also imperative to maintain the human touch, particularly during claims time, such as being proactive with claims process updates via the communications channel of their choice.
Secondly, if considering digitisation, freeing up staff to spend more time on customer value-added activities instead of tedious manual processes, thanks to the automation of processes and tasks, also has a direct correlation to a winning customer experience and staff retention.
What are some key challenges faced by insurers in their digital transformation journey?
Insurers are under immense pressure at the moment on multiple fronts including increased regulation, more costly claims events and inflation. It’s an extremely challenging environment and they’re under a lot of pressure to respond fast. In their pursuit of speed, there often becomes a misalignment between the business and IT, resulting in no clear and resolute digital transformation vision from the outset.
With no clear vision, there’s little direction and this results in insurers making a series of disparate tactical decisions, rather than a unifying strategic decision that would lead to a true digital transformation and the desired business and customer outcomes.
This is clear when we look at those insurers who continue to maintain and upgrade their legacy systems, despite the consistently poor customer outcomes they’re producing. Companies that work with both IT and operations to provide automation that takes into account the internal systems and the customer goals are experiencing considerable success.
We’re seeing that there is a trend toward more incremental value delivery drivers as opposed to large-scale big-bang digital transformation projects. The incremental or phased approach has a lower perceived risk profile and is a lot easier to get approval from the board. Automation solutions are playing a big role in this approach and phased maturation.
What are the essential digital transformation initiatives/processes that you believe will have the greatest impact on the industry?
There are two distinct areas that I believe will have the greatest impact. As mentioned earlier, improved digital self-service and proactive communication across policy, billing and claims are extremely impactful and there is a tremendous opportunity for insurers to enhance their offering in this area.
Where this will have the greatest immediate impact is the automation of document ingestion as part of the business process. This has far-reaching benefits, positively impacting customer experiences, employee satisfaction and OPEX. The accuracies in this area also allow for greater efficiencies in scale and adherence to regulatory standards.
What role do you see the partnership with TCG Process benefiting customers over the next five years?
We partner with best-in-breed providers to further enhance the value we deliver to our insurer customers, so it’s no mistake that Duck Creek has partnered with TCG Process. We view a solution such as DocProStar as having a significant impact on processes and the management of file volume with speed and accuracy.
The opportunity to automate a significant volume of manual processes by integrating Duck Creek’s core policy and claims platforms with TCG Process’ DocProStar means the OPEX saving potential is astounding and it will be exciting to see what we can achieve together in the coming five years.
For more information on Duck Creek visit: https://www.duckcreek.com/
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