Insurance Will Soon Say Farewell to These 3 Tedious Tasks

Full Insurance Automation for 3 Tedious Tasks

Ever since we figured out how to make wheels, we've been all about automating stuff to make life easier. The cost of automation and digital technology has declined globally in recent years. Insurance carriers, irrespective of size are realizing that the barrier to new investment in digital technology and automation is lower than ever before. 

Insurance industry consultants have estimated that there is approximately 30% wastage involved in existing insurance processes. This inefficiency can show up in different ways, tasks that get done over and over again, workflows that just don't flow smoothly, delays that make you want to pull your hair out, and resources that aren't used as efficiently as they could be.

To remain competitive, insurers will have to improve operational efficiency, reduce costs, and enhance overall performance. This is why specific tasks will become fully automated down the line.

Insurance Automation Brings High Returns 

In the 1970s, UPS initiated a strategy to enhance delivery efficiency by reducing left-hand turns, ultimately implementing the "loop dispatch" system. This innovation aimed to minimize risks associated with crossing traffic and idle time at intersections. They developed ORION ((On-Road Integrated Optimization and Navigation), a heuristic algorithm, to optimize routes.  Since ORION's initial deployment, it has saved UPS about 100 million miles and 10 million gallons of fuel per year by paying attention to a seemingly minor issue. Now every logistics organization uses a route optimization system.

Examining insurance internal processes reveals potential inefficiencies akin to left-hand turns and idle time. While less visible than UPS's trucks, these inefficiencies impact cost, service quality, and competitiveness.

McKinsey predicts that by 2025, investments in automation will constitute approximately 50% to 60% of back-office functions.

Let's talk about Risk Managers and those extra tasks that take up their time - like collecting premium checks, dealing with financing agreements, and managing account payables after collecting premiums. These are all things that could be automated but having to handle them manually just adds to the inefficiency we're already dealing with. 

It takes employees away from what they're good at – selling and caring for customers. And in a competitive market, that's where insurers need to shine. The same goes for underwriting. If we automate the manual stuff, your team can spend more time focusing on assessing risks and making smarter decisions.

These Insurance Back-office Operations Will Get Fully Automated

The Bureau of Labor Statistics says half of the insurance workforce will retire in 15 years, leaving 400,000+ positions empty. And get this – only 4% of millennials are interested in insurance careers, even though they're set to dominate 75% of the workforce by 2025. Digital technology and insurance automation in repetitive processes are vital in such a scenario. 

These are the tasks that are expected to get fully automated:

1. Automating Data Entry to Speed Up Operations

One significant time-saver in insurance process automation lies in data entry. Rather than manually rekeying information from documents into downstream systems, data entry automation solutions step in to handle the heavy lifting.

Intelligent intake solutions excel in accuracy as they don't succumb to fatigue. Moreover, data entry automation solutions leverage staggered loop learning, continuously improving accuracy over time based on employee feedback. Furthermore, after analyzing documents, intelligent intake solutions can automatically populate up to 80% of the required fields. This accelerates the process and enhances accuracy, ensuring smoother operations overall.

According to McKinsey, about 40% of property and casualty (P&C) carrier expenses are tied up in their top 20 to 30 core processes, such as underwriting. Insurance automation of repetitive tasks has the potential to cut down, and sometimes even wipe out these costs.

Freed from the burden of manual data entry tasks, underwriting and claims professionals can expedite their work and allocate more time to providing exceptional customer experiences.

automated data entry viability for insurance

2. Automated Document Processing 

Insurance firms are often inundated with documentation, some of which is crucial for effective risk management but can be intricate and time-consuming to review manually. Automation offers a solution by handling bulk document reviews, allowing employees to concentrate on more intricate issues. Additionally, it ensures that high-priority tasks are promptly directed to the appropriate personnel for human intervention, enhancing both productivity and accuracy in document processing.

Advanced technologies like context-aware optical character recognition (OCR) can scan and interpret human messages, intelligently classifying attached documents and even automating responses or routing emails to the relevant departments. 

Automated document processing can be integrated into processes such as policy issuance, claims processing, underwriting, policy renewals, and customer correspondence to enhance efficiency and accuracy.

Also Read:  Everything You Wanted to Know About AI for Your Insurance Business

3. Automating Policy Renewal Workflows

Here's something to consider: A recent study found that businesses utilizing automated insurance renewal processes boast an impressive 93% success rate in renewing their policies on time. In contrast, those without automated systems, dependent on complex spreadsheets, only had a 60% chance of successfully renewing their policies.

Automating policy renewal can be implemented universally across all policy types or selectively targeted for specific policy categories. The extent of automation in the renewal workflow can cover some or all of these phases:

  • Automated Renewal Reminders: Timely prompts before policy expiration.

  • Pre-filled Renewal Forms: Automatically populated with existing policy details.

  • Dynamic Pricing Algorithms: Accurate renewal premium calculations.

  • Instant Renewal Approvals: Quick approval of straightforward renewals.

  • Automated Communication Channels: Chatbots handle renewal inquiries.

  • Integration with Payment Gateways: Seamless online premium payments.

According to a study by Gartner, over half (51%) of insurance companies larger than $10 billion are actively utilizing AI, in contrast to just 34% of smaller insurers. While implementing insurance automation may seem daunting, it's important to remember that Rome wasn't built in a day, and neither will your automation program. It demands careful planning, execution, and ongoing refinement. However, with the right approach and a modern core insurance platform, this is an attainable goal. The time to automate is now—so why wait? Talk to the insurance experts at SimpleSolve and kickstart your automation journey today!

Topics: Intelligent Automation

Chandra Mouli

About The Author

Chandra Mouli

Chandra Mouli “Mouli" has over 30yrs experience working with Global technology providers in senior technology & management roles. Over the last 2 decades, he has led transformation programs by building leading-edge systems for P&C, Enterprise Risk Management solutions & Life Insurance-related sectors and delivered solutions to Global insurers in around 65 countries. As Head of Innovation at SimpleSolve, Mouli envisioned and crafted SimpleINSPIRE and evolved it into the next-generation digital ecosystem for the insurance enterprise. The author of SimpleSolve’s PEAR methodology, Mouli is on a mission to “automate the routine and humanize the exceptional” which is giving the thrust to SimpleINSPIRE product leadership that very few competitors can challenge.

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