Get Ready for the Future: How Insurance Companies Use These 3 Digital Capabilities to Outperform the Competition
Blog: The Tibco Blog
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2020 showed companies that connected, data-driven insurance is here to stay. To lead in the industry, insurers have to exploit the power of data and advanced analytics to deliver personalized, contextual products for best-in-class services. Digital capabilities help companies respond quickly to changing customer preferences and effectively block inroads from nimble, non-traditional competitors such as insurtechs.
A recent IDC InfoBrief, sponsored by TIBCO, Connected Intelligence in Insurance, states that “By 2023, 40% of insurers will automate claims processes with AI technologies and conversational interfaces to improve speed of response, efficiency, and personalization.” Insurance companies that fail to recognize these trends and respond quickly will lose customers to digital competitors.
So how can a traditional insurance company rise to face current data challenges? Read on to learn about the new digital capabilities that are revolutionizing the insurance industry.
Customer Capabilities: Increase Relevancy
It’s time to move from basic offerings to the best possible experiences for customers. Rather than have your customers talk over the phone, wait in line, or search through your website for help–offer them digital options that meet their schedules and needs.
Capabilities like facial recognition software, chatbots, or ML-algorithms can reduce friction in claims processing, increase claims accuracy, and improve risk selection. Not to mention these capabilities make your experience easier for customers–with reduced wait times and easy access, they can get the support and response they need whenever and however they want.
Sara Assicurazioni, a leading insurer in Italy, launched a mobile app and chatbot so customers could have access to vital information 24/7. Renewing policies, reporting an accident, and processing claims through the app is all self-service, convenient, and saves time for both policyholder and their agent.
Sara Assicurazioni isn’t the only leading insurer using data as a competitive advantage. AA Ireland uses predictive analytics in dynamic pricing models to optimize price in real-time for customers, analyzing complex factors without lag. This software monitors fluctuating discounts with volume and profitability, allowing the company to derive insights about the total risk in specific markets and the best price for customer segments.
Intelligence-Based Automation Capabilities: Evolve and Learn
Data-powered AI, partnered with human intelligence, allows companies to transcend standard, inefficient workflows and detect unseen anomalies, filling in traditional workforce gaps. AI-based intelligence can streamline processes and, in combination with machine-learning automation, augment human processes with data-driven speed to allow for more precision in decision-making, timely outcomes, and data-intensive processes.
This Reinsurance Company automated parametric insurance, which insures against situations where certain parameter values are exceeded. If the stated parameter values are met, the algorithm sets up the claim payout–without any employees’ needed intervention. This algorithm allows for faster and more accurate payouts, improving customer experiences.
Risk Mitigation Capabilities: Reduce Potential Fraud
Human errors mean companies spend more time resolving claim issues, payout mistakes, fraudulent concerns, and more. Predictive analytics uses advanced techniques to spot anomalies in data and investigate potential fraud, reducing overall risk and fraudulent claims.
Asurion uses two main analytics tools to help detect and prevent fraud: rules-based evaluations and event-based correlations. The company collects information across all customer channels and then evaluates the risks associated with individual claims. Asurion reports, after deploying analytics, it expects to reduce the fraud dispute ratio by 10 to 20 percent the first year, and about 30 to 50 percent over the next three years.
Rise to the Data Challenge
Other leading insurance companies—some of whom may be your competitors—are making the transformation and are succeeding. Advanced analytics and integrated data management capabilities are the top solutions for digital insurers and the top barriers for traditional insurers.
Advanced analytics and integrated data management capabilities are the top solutions for digital insurers and the top barriers for traditional insurers.
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Don’t let a lack of insights from data be a barrier to your success. Read this IDC Infobrief, sponsored by TIBCO, Connected Intelligence in Insurance, to learn how insurers can become more personalized, more predictive, and more real-time than ever.