OPINION Is insurance CX the route to improved margins?

Tim Hood, Associate VP for EMEA at Hyland, discusses how new technology can centre customer experience (CX) in customer service to create more enthusiastic customers.

It may be too early to talk about the legacy of insurtech, but more than ten years after the term first piqued the interest of the wider industry, there are commercial, technology and strategic lessons to be learned. For well-established insurers, a key question is how they can harness some of the best practice that has emerged, particularly with technologies that enable firms to align customer service more closely with customer experience (CX). Those who achieve that alignment can transform instances of brand apathy into brand enthusiasm.

A key catalyst in transforming our relationship with customers, insurtech has helped change our understanding of how the industry can deliver the digital-only experience customers are demanding.

In ten years’ time, we may view 2021 as a turning point, if Accenture’s recent predictions come true. According to the consultancy, “… significant global premiums are likely to be renewed with innovative new products and a shift in distribution towards digitachannels…insurers cannot rely on historic retention rates … [and] … innovation in both product and distribution is a must if an insurer is to defend existing revenue”.

If we’re not yet at the juncture where CX has surpassed price and product as the top brand differentiator, there’s not far to go.

However, the bottom-line implications of getting it right are considerable, with research by PwC suggesting 86 percent of buyers were prepared to pay more for great CX. The same data show that buyers would be more willing to accept a corresponding increase in the overall price if that jump meant better CX.

Against this backdrop, what does the future hold, particularly for those that haven’t yet moved beyond the first wave of digital transformation?

The latest enterprise-driven content services platforms offer improved agility and adaptability, provide a complete view of insurers’ content ecosystem, allow easier communication across departments and help users adapt to changing business and customer demands.

While steep, these challenges are by no means insurmountable for most insurers.

Digital transformation isn’t about replacing legacy systems just for the sake of replacing them. It’s about delivering tangible, immediate benefits to customers.

Once you know the task ahead, you can start making some core IT changes. Content services is a credible starting point, as it helps create a strong foundation for the next stages of your digital transformation. A cloud-based content services platform will help firms avoid having data trapped in silos, created by vertical business lines or departments.

Harnessing tech for a seamless experience

Consumers expect fast and frictionless interactions, from whoever they do business with and robotic process automation, artificial intelligence and machine learning can be the next steps. Such solutions are making business processes more efficient and streamlined across the entire enterprise and, as a result, insurers are empowered to create processes that are comparable with the playbook of any mainstream consumer brand.

Take for example ERGO Group AG, a Munich Re subsidiary, and one of the largest primary insurers in Europe.

Faced with the challenge of creating and managing more than 30 million documents every year, ERGO not only recognised the importance of being able to deliver content digitally, but improving the efficiency, productivity and consistency of its communications efforts.

The introduction of Content Composer, a customer communications management solution that can manage high-output volumes and complex document formats across multiple channels, has automated ERGO’s creation and management of personalised documents and communication, with high flexibility and without losing time.

One such process, where the tool is used in batch mode, enables staff to add variables and modules to letters or create documents for the digital customer file, before being filtered, sorted and coded, with different print batches being created. Overnight, hard copies are printed and distributed to customers, with the automation capabilities streamlining the batch process and, in turn, creating significant efficiency gains.

While productivity improvements are always welcome, it is equally important that customers can obtain information related to their insurance directly from their preferred digital platform. This means that customers, for example, can update the product features required, before receiving a completed PDF with the insurance offer, terms and conditions and all other necessary documents, within a few seconds.

It’s a process that today’s customers “expect … to run in real-time,” according to Benedikt Gast, head of ERGO’s IT-AE Docuservice.

Digital transformation is not a one-off, time-defined event. It’s an ongoing process that requires close monitoring and commitment, to ensure close alignment with the expectations of the marketplace. Customer experience is already separating those insurers that have recognised the opportunity and those that are yet to acknowledge that the industry is in the middle of transformational change. Those that fail to pick up the challenge may not be here to mark the 20th anniversary of insurtech, one of the most significant drivers for change.