The Covid-19 pandemic presented major logistical challenges to the insurance industry, with many organisations scrambling to activate business continuity plans and support the sudden shift to remote operations. Insurers largely maintained service levels and avoided disruption in the move to digital channels, but the shake-up presents an opportunity for greater digital transformation.
Many in the C-suite understand the need and value of digital transformation. KPMG surveys of executives found the majority have increased their digital transformation budgets and accelerated project timelines.
As a leading provider of digital solutions and services for insurers, Verisk’s claims portfolio features advanced technologies and data to improve claims management, tackle fraud, and better engage policyholders. We understand the industry’s appetite and focus areas for digital transformation in 2021 and beyond.
Three key areas will shape the digital transformation agenda for insurers:
1. There will be no return to ‘business as usual’
There’s been a great deal of discussion around what the ‘new normal’ will look like and to what extent organisations will return to pre-pandemic operations. Many have realised the opportunity to digitise existing processes and services, delivering convenience for customers and efficiencies for employees and operations.
In the insurance and financial services industries, digital transformation is on course to accelerate. Business leaders are realising the long-term benefits of embracing digital-driven operations. We’ve seen, for example, Lloyd’s of London exploring a blend of physical and digital workplaces, with a limited re-opening of the trading floor and the announcement of a virtual underwriting room.
But businesses looking to embrace this long-term shift will need to put in place systems that allow employees and customers to enjoy the same – or greater – level of service and convenience they enjoyed pre-pandemic. That means supporting working from home through cloud-based collaborative platforms, de-siloed data, and self-serve solutions across multiple platforms.
2. Counter-fraud efforts present challenges and opportunities
The latest data shows that fraud continued and even evolved during the pandemic. Insurance Fraud Bureau data identified some 170,000 claims between October 2019 and the end of 2020 linked to “crash for cash” schemes.
A key part of my role focuses on strategic development of new anti-fraud projects and services to tackle these issues, and emerging technologies are at the heart of these projects and services. Digital transformation is likely to be most prominent in the counter-fraud space. Many major UK insurers still use legacy in-house systems and manual processes such as spreadsheets to identify known fraudsters and blacklisted individuals.
Replacing these outdated methods with advanced technology allows insurers to modernise their IT footprint and introduce powerful new counter-fraud capabilities and process efficiencies. Opportunities range from greater platform and database integration—which would enable real-time ‘data washing’ of all claims and policies—to AI and automation deployments for processes such as damage analysis and triage.
3. The technology is ready and able to provide fully remote claims operations
Remote technology has been valuable during the pandemic for claims adjusters, with remote sensing, aerial imaging, and AI providing an effective alternative to physical inspections. Yet, there are far more opportunities for remote services to benefit insurers and policyholders alike.
For example, Verisk’s ClaimXperience allows property claimants to use remote video capabilities to provide an early assessment of damage and collaborate directly with a dedicated claim handler. The success of this technology speaks for itself, with a high degree of accuracy in estimating repair costs and the ability to settle a claim in just 13 minutes. On the motor front, IVI helps policyholders provide vehicle damage photos from the scene of an accident using a self-service app, streamlining assessment and settlement timeframes.
It is vital that counter-fraud efforts are not side-lined or weakened by any renewed focus on automated and self-serve solutions. Further digitisation of fraud detection is enhancing fraud identification across multiple channels, whether extracting metadata from claim evidence to check for consistency, identifying photo manipulation, or extracting and analysing document contents.
No need to ease off the digital transformation pedal
Now is a prime opportunity for insurers to better connect people, processes, and policyholders. Many businesses are already making solid progress in delivering digital transformation initiatives, but technology and process innovation are continuously pushing the boundaries for more digitisation.
Insurers need flexible, scalable platforms to support mass remote operations and collaboration. Linking front- and back-office operations with powerful cloud-based solutions provides a solid digital foundation to serve policyholders effectively, tackle the ever-present threat of fraud, and unlock the full value of both in-house and third-party data.
To learn more about how InsurTech, innovation, and data analytics are shaping the insurance industry, sign up for free access to Verisk Vision 2021 – weekly expert sessions exploring the hottest topics affecting insurers.