The insurance business is considered one of the most entrenched industries, even in an era of sweeping ground-up reconfiguration. It is nonetheless experiencing increasing demands and new forms of competition, as well as challenges to its industry-wide culture. To stay dominant in a changing industry, insurance providers must adopt new methods of operations more suited to an increasingly digital landscape.
Seismic industry shifts
Due to overhauls in online offerings and customer service techniques across the business spectrum, customers have become accustomed to the non-stop presence of digital services, 24-hour customer service, and rapid issue resolution. For the insurance industry, new boutique insurance providers are popping up everywhere. These startups are light, quick and entirely digital. Plus, they are easy to work with.
Even without new competitors in the field, expanded regulatory standards and documentation requirements have led to increased workloads for the entire insurance industry.
Insurance providers are aware that these developments have created a situation where the adoption of new technologies is critical, and are going to great lengths to locate and integrate new solutions which will help them maintain their competitive edge.
With the vast and entrenched operational systems of large insurance companies, however, digital overhaul does seem like a daunting prospect. Enter robotic process automation (RPA).
What is robotic process automation?
RPA, which has already demonstrated its value for many industries, is highly suited for insurance as it is most effective when employed in sectors combining technology with the skill and knowledge of employees — exactly like the insurance business. Supplementing the professional human workforce by providing a digital workforce on which employees can offload time-intensive repetitive processes, not only frees up the human workforce for more engaging and productive tasks but keeps them from getting bored and making costly mistakes.
RPA is becoming a necessity for businesses in the insurance industry and is capable of reducing the time spent on a task by automating entire processes — some by up to 60%, according to PwC — all while effectively eliminating opportunities for human error. As more insurers implement RPA solutions, several clear advantages have emerged. Here are some of the most significant.
Streamlining claims-processing, underwriting
Tasks within the insurance industry are data-intensive and characterized by a large number of repetitive tasks. Typical examples of this are underwriting and initial claims processing, both of which require substantial amounts of largely manually executed data entry and retrieval — tedious, costly, labor-intensive, and error-prone work.
The rules-based nature of these processes makes them an ideal task to be offloaded to a digital employee, which can rapidly complete the task with no errors. Implementation of RPA solutions for the optimization of processes in similarly rules-based tasks such as billing, document management, and data entry has led to increased accuracy, reduced turnaround time, and improved customer relations across the business and financial services spectrum. There's no reason why this shouldn't be the same for insurance, too.
Business analytics and regulatory compliance
Insurance providers, along with all enterprises operating in increasingly digitalized fields, are actively seeking improved methods of internal review, not only to increase efficiency but to reduce cases of regulatory noncompliance due to human error as well. As governmental oversight increases putting additional strain on already busy employees, along with the rise small but effective upstart competitors, increased internal optimization is becoming increasingly vital — and here too, automation systems can help. RPA provides easily analyzed review and feedback on actions taken, with every step recorded, meaning that process efficiency can be easily assessed, and extraneous steps removed. This also allows for internal restructuring to increase efficiency. For example, if the need arises for intensified focus and manpower in one particular department or field, the digital workforce can easily be shifted accordingly to focus on more crucial tasks.
Scalability
For insurers, workload surges which can occur following certain events such as in the aftermath of natural disasters, or in the medical insurance sector towards the end of the fiscal year, are facts of life for the industry. Nonetheless, sudden increases in claims can create a workflow backlog keeping human staff overworked, overstressed, and can cost the company substantial resources both in terms of overtime pay and the potential for an increase in errors. RPA provides the ability to immediately increase the workforce without lengthy additional training periods as well as ensure continued high levels of accuracy despite drastic rises in work demand, and best of all — digital employees work non-stop.
Members of the insurance industry stand to benefit substantially — existentially, even — from adopting RPA solutions. A tool which offers unquestionable increases in efficiency for numerous internal functions is not one that can be ignored. Providers that fail to capitalize on digital tools as a way of staying relevant in the insurance industry will, eventually and inevitably, find themselves replaced by those who have.
Harel Tayeb is CEO of Kryon Systems, a provider of robotic process automation.
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