The Benefits of Digital Insurance

The financial services industry is espousing digital in order to offer the innovative services and convenience that the digital age customer has come to expect. In an earlier post, we have looked at how digital insurance enhances consumer experience, which has been both a defining force as well as a major advantage.

Besides enriching customer connections, there are other inherent advantages to insurers going digital. In this article, we look at a some of the other positive outcomes of their digital journeys that insurers can leverage.

Increased efficiencies

Digital technology, data mining and data analysis give insurers the opportunity to know their customers better in order to price and underwrite policies more accurately and better identify fraudulent claims. In the traditional insurance universe, insurers are mostly unaware of the particulars of their customers. In today’s hyper-connected world, if an existing customer sells a house, insurers can use this easily available information to sell home insurance to the next owner, perhaps also cross-sell auto and life cover.

Technology offers efficiencies in multiple other ways. Teams increasingly use mobile devices from the field for routine house-keeping tasks that’d earlier require them to go back to the office to file paperwork. This also allows managers a real-time view of numbers and agent activity. Integration of CRM solutions with communication channels and ERP allows for further efficiency as agents do not have to update records manually after every interaction.

Enhanced safety, reduced fraud

Digital transactions inherently create a trail that is a deterrent to fraud. The data created for every transaction in a digital environment lends itself to easier and more efficient analysis, which in turn reduces the chances of fraud and mis-selling going undetected. Another advantage is that as proposal forms are filled by customers directly through self-service options, mistakes that lead to loss of time, money and create complications during claims can be circumvented. As further networks are built with government agencies to verify customer identities, a fall in unscrupulous practices is imminent. Similarly, better data analytics will lend the ability to flag practices like premium theft, sliding and policy churn for earning benefits, making it easier to identify and prevent them.

Shorter sales cycles

Innovate services and products

Insurers are driven to keep pace with customer expectations that are mainly being set outside the domain of financial services. Experiences as disjoint from insurance as ride hailing and space sharing influence insurance customers. On the flip side, as insurers adopt data-driven practices and go social, they know far more about their individual customers that was possible ever before and to pitch the right offering at the right time. Technologies like artificial intelligence, telematics and machine learning help insurers to marry products and services to the expectation trends. Instead of generic offerings and outdated data, products and services can be precisely designed for the target demographic by leveraging the customer insights available to ubiquitous social media.

Improved management decisions

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