Editor's note: Steve Wiser is CEO of Specialized Business Software

The Industrial Revolution marked a technological and economical turning point for manual labor, which made history by forever changing the way business processes and methods were implemented. Machinery reduced the risk of human error and ushered in a new, more efficient era. In the same way, new technology driven by automated software processes has enabled successful insurance providers to do more with less. Here are five key reasons progressive insurers turn to automation technology:

Self-Service

Automated software allows insurance companies to offer customers enhanced self-service capabilities. The prevalence of the Internet and mobile devices has created a strong profusion for all things online, so it is not surprising that self-service capabilities accessed via the web continue to grow in popularity. These automated systems provide consumers the opportunity to make claims, review policies or make billing payments online without prompting from an agent or company. With self-service, insurance agencies may also review their customer-service interactions and engagement if the automated software allows for feedback.

In addition, insurers want to be able to provide their policyholders with self-service technology to streamline operations and increase efficiency. Ineffectual processes such as distributing documents back and forth via email and entering information into internal systems manually are eliminated, decreasing human error and time to completion. This solution also eliminates duplicate data entry, providing one universal document and tracking what changes are made and who makes them.

Increasing Regulations

Automated technology is better able to shoulder the compliance burden. Insurers must deal with increasing and ever-evolving regulations. For example, many agencies have received SOC 2 financial audits, which examine the risks of the general controls, policies and procedures related to the agency's technology and information systems.

An automated technology system creates an audit trail through logging when an agent changes any rates or when customers view insurance policies. Should an unauthorized user attempt to make changes to documents, the system recognizes and notes the attempt or blocks it altogether. The system keeps an immutable log of revisions that can be used by auditors, risk managers and compliance officers to determine who accessed the system and what if any changes were affected by any illicit use.

The rating of premiums should also require an automated process. When using simple spreadsheets, it is easy to mistype data, accidentally change a rate, make an incorrect calculation or use the wrong version altogether. Rating calculations need to be reviewed for accuracy and should require authorization to gain access to change algorithms. When the information is controlled by an automated software system, there is no 100 percent manual verification needed. Quality-control samples can be taken automatically to allow users to spot check the system. All this reduces the risk of failing an audit and having to pay any associated fines.

Web Access

Automated technology offers the ability to access documents anywhere with a web connection. Digital applications are in greater demand now more than ever; in fact, there is often an expectation that all documents will be available online. However, there are still some agencies operating their policy administration systems on paper, non-real time systems and spreadsheets, each of which have no document management functionality at all. In order to keep with up with today's technology, agencies need to use online administrative systems. When a customer's insurance information is securely placed online and made available to the insured, all parties have real time access to the system of record and changes can be immediately made to an account from anywhere.

Big Data and Analytics

In order to be competitive, insurance companies need access to their data for analysis and can only do so efficiently with software systems that gather this information. Automated data processes make it possible to provide better risk management because they can create the data records needed to get an idea of how the business is operating through big data and associated analytics. Many insurance companies have random data spread across different technology platforms or missing key data elements because of offline work processes, making it difficult to accurately predict the true values of pools of insurance policies. The ability to assemble and synthesize all information in one warehouse is a benefit of automation. With a customized automated system, data can be collected and recorded in one single system and accessed in real time. These systems are reliable and efficient, cutting out time-consuming maintenance and the risk of error. Automated data-management systems provide the infrastructure that allows insurers to access immediate, up-to-the-minute analytics to better view their risks, clients and products.

Increased Scalability

Automated systems are more scalable and enable insurance companies to expand business without having to increase the number of employees, which increases net income and profits. Insurers need to be able to grow their business without internal processes or systems holding them back. New business should not be turned down or lost because of an inefficient system and increased workload. In the same way, a scalable system can help insurers to scale down without losing its hard-to-replace staff. Complex processing such as specialty lines rating and out-of-sequence endorsements need to be automated as they are difficult to perform correctly when handled manually. Automated insurance-company systems can even enable agencies to react to demand without affecting its staff.

Special Reports /

Top 5 Reasons for Insurers to Embrace Automated Processes

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