August 25, 2017
The insurance industry is a conservative one. Conservative being code for outdated and not serving the agents and brokers at all. Most agencies are built on paper-and-ink processes or siloed computer systems that have trouble keeping up with the way consumers want to do business today.
While most agencies are focused on not rocking the boat, others are realizing that pushing the limits and adopting various forms of insurance technology, or InsurTech, is what will ultimately result in long-term success. So, if you’re one of the agencies that is ready to embrace change, here are 5 InsurTech trends you’ll want to be aware of:
Getting away from wet signatures and overnight FedEx packages should be the goal of all insurance agencies, but sadly, most are still committed to this old-school method of doing business. The digital revolution will leave these kinds of agencies in the dust.
Everything is going digital - from online digital policy applications, to policy servicing, and claims processing. Not only does this make it easier to run an agency, it makes it cheaper and more convenient for the customer.
You can probably guess that insurance technology that allows for such convenience in everyday processes would be majorly disruptive, and you’d be right. Who’s going to want to do business with someone who doesn’t respond immediately?
Another trend coming to an insurance agency near you is artificial intelligence (AI). AI systems are allowing agencies to experiment with more advanced and accurate underwriting. These systems promise to be more predictive of future claims and risks than current systems.
AI has other applications, as well. Since AI is capable of deep learning it is great when used in chatbots. Intelligent chatbots use natural language processing and sentiment analysis that make them useful as the first line of communication with clients. They can automatically process customer concerns and wishes, and address them in a personalized way, thus freeing up time for agents and setting the stage for them to give the next step in service.
In the old days, agents used to walk door-to-door to sell insurance. Today, they can make phone calls. But, really, the approach hasn’t changed much. They’re still pushing information to consumers. Problem is, consumers don’t prefer to do business that way anymore. They are out there, on the Internet, digging for information, actively shopping on search engines, and making comparisons. They’re asking questions on forums and getting recommendations from friends, family, and even strangers.
The insurance broker is left out of the conversation until the consumer gets to the point where they want to buy. Obviously, this creates a problem. Consumers aren’t perfect information-gathering machines. They may get biased or incomplete data. They may not understand the nuances of how various insurance policies work, or the long-term consequences of making one choice over another.
This is why brokers and agents need to move ahead of the consumer crowd. They must adopt new contextual pull platforms that allow brokers to meet consumers, where they’re at right now in life. Instead of pushing products, brokers become problem solvers or expert advisors, only speaking to the essential issues at hand with a solution that makes sense for the customer’s unique situation.
The banking industry is ahead of the insurance industry on this one. Think Simple Bank, Ally, and Moven. These banks are built on an open architecture, and use their parent bank’s platform to build their own consumer-centric applications and banking environment.
Result? Consumers love them.
This needs to happen in the insurance industry (and is happening, to some extent). Insurers and brokerages that build on an open architecture, and open up their own platforms for development with 3rd parties, are going to find themselves way ahead of the curve.
A cloud-based platform can give you a 360-degree view of your business and connect your front and back office in one central place. Also, this type of technology can give your insurance agents more flexibility in how they sell and interact with customers, ultimately leading to more sales.
For example, agents will be able to leave the office and talk to customers anywhere they need to. They can make presentations on tablets and even smartphones, run multiple quotes, and allow their clients to compare policies from several different insurers at the same time. They can take digital applications in the field and send them in electronically so underwriting can get to work on them. And, after the sale, the agent and customer will be able to communicate through an online self-service portal where the customer has access to policy values and information. These are all ways that make the sales and management processes as smooth and convenient as possible.