Editor's note: Steve Wiser is CEO ofSpecialized Business Software

The Industrial Revolution marked a technological and economicalturning point for manual labor, which made history by foreverchanging 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 byautomated software processes has enabled successful insuranceproviders to do more with less. Here are five key reasonsprogressive insurers turn to automation technology:

Self-Service

Automated software allows insurancecompanies to offer customers enhanced self-service capabilities.The prevalence of the Internet and mobile devices has created astrong profusion for all things online, so it is not surprisingthat self-service capabilities accessed via the web continue togrow in popularity. These automated systems provide consumers theopportunity to make claims, review policies or make billingpayments online without prompting from an agent or company. Withself-service, insurance agencies may also review theircustomer-service interactions and engagement if the automatedsoftware allows for feedback.

In addition, insurers want to be able to provide theirpolicyholders with self-service technology to streamline operationsand increase efficiency. Ineffectual processes such as distributingdocuments back and forth via email and entering information intointernal systems manually are eliminated, decreasing human errorand time to completion. This solution also eliminates duplicatedata entry, providing one universal document and tracking whatchanges are made and who makes them.

Increasing Regulations

Automated technology is better able toshoulder the compliance burden. Insurers must deal with increasingand ever-evolving regulations. For example, many agencies havereceived SOC 2 financial audits, which examine the risks of thegeneral controls, policies and procedures related to the agency'stechnology and information systems.

An automated technology system creates an audit trail throughlogging when an agent changes any rates or when customers viewinsurance policies. Should an unauthorized user attempt to makechanges to documents, the system recognizes and notes the attemptor blocks it altogether. The system keeps an immutable log ofrevisions that can be used by auditors, risk managers andcompliance officers to determine who accessed the system and whatif 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 usethe wrong version altogether. Rating calculations need to bereviewed for accuracy and should require authorization to gainaccess to change algorithms. When the information is controlled byan automated software system, there is no 100 percent manualverification needed. Quality-control samples can be takenautomatically to allow users to spot check the system. All thisreduces the risk of failing an audit and having to pay anyassociated fines.

Web Access

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

Big Data and Analytics

In order to be competitive, insurancecompanies need access to their data for analysis and can only do soefficiently with software systems that gather this information.Automated data processes make it possible to provide better riskmanagement because they can create the data records needed to getan idea of how the business is operating through big data andassociated analytics. Many insurance companies have random dataspread across different technology platforms or missing key dataelements because of offline work processes, making it difficult toaccurately predict the true values of pools of insurance policies.The ability to assemble and synthesize all information in onewarehouse is a benefit of automation. With a customized automatedsystem, data can be collected and recorded in one single system andaccessed 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 thatallows insurers to access immediate, up-to-the-minute analytics tobetter view their risks, clients and products.

Increased Scalability

Automated systems are more scalable and enableinsurance companies to expand business without having to increasethe number of employees, which increases net income and profits.Insurers need to be able to grow their business without internalprocesses or systems holding them back. New business should not beturned down or lost because of an inefficient system and increasedworkload. In the same way, a scalable system can help insurers toscale down without losing its hard-to-replace staff. Complexprocessing such as specialty lines rating and out-of-sequenceendorsements need to be automated as they are difficult to performcorrectly when handled manually. Automated insurance-companysystems can even enable agencies to react to demand withoutaffecting its staff.