As the insurance industry moves further into the digital age, it has become increasingly important for insurers to invest in their digital transformation efforts to remain competitive.
By embracing digital transformation and leveraging modern technology, insurers can improve their processes, enhance the policyholder experience, and unlock new revenue streams and opportunities. However, knowing where to begin and which tasks will add the most value can be challenging.
Below, we’ll discuss how insurers can determine priorities for digital transformation and provide solutions to the challenges they may encounter.
The Current State of Digital Insurance Transformation
The insurance industry is often slow to adopt new technology and further market digitization. So while the industry has undergone a digital transformation over recent years, some insurers have yet to embrace the full potential of advanced technology.
Either way, the ongoing trends in the macro economy and policyholder expectations mean that insurers won’t have a choice when it comes to modernizing their operations in the coming years–it will be imperative to their long-term vitality.
41% of policyholders claim to be likely to switch providers due to a lack of digital capabilities. At the same time, 67% of insurance CIOs believe that SaaS will transform the industry in five years or less, and 85% of insurance CEOs say that the COVID-19 pandemic accelerated their digital transformation efforts.
Digitization of the industry is a pertinent issue for insurers today, even if players across the industry are at varying stages of transformation. All insurers should assess their current state and determine the priorities for future initiatives to help drive better efficiency, cost savings, and an enhanced policyholder experience to fit the future marketplace.
How to Determine Priorities for Digital Transformation
The digital transformation process can be daunting, especially given the number of initiatives and technologies to consider implementing–including automation, chatbots, self-service portals, and more. Insurers should first determine their priorities and goals for their digital transformation efforts to deploy their resources efficiently and help their initiatives succeed.
Throughout this process, insurers will need to consider a wide range of factors, including:
- Policyholder needs and expectations
- Business objectives and goals
- Existing infrastructure and systems
- Competitive landscape
- With this in mind, they can go through the following steps:
1. Conduct a Needs Assessment
A needs assessment helps insurers identify areas where digital transformation will impact their organization and policyholders most. It can involve reviewing business processes, identifying pain points or bottlenecks, and determining how technology can help address these issues.
For instance, an insurer may recognize that their claims processing is an area of the business that policyholders often complain about. This could showcase an opportunity for technology to streamline the process and improve the policyholder experience through quicker and more efficient claims processing.
2. Identify Potential Solutions
Once the insurer has a clear idea of their business’s most pertinent issues, they can brainstorm potential technological solutions that fit their business objectives. They may want to research the available technology solutions, including chatbots to automate routine policyholder questions on the website, AI programs that can automate claims processing, and more.
3. Prioritize Based on Business Objectives
After identifying their most pressing issues and potential solutions, insurers can begin prioritizing projects based on their needs and objectives. For insurers focused on improving the policyholder experience, digitization projects related to customer experience should take the forefront instead of automating back-end systems.
It’s not always necessary to start with the biggest, most impactful projects first, either. For insurers just starting to invest in digital transformation, starting with smaller, more manageable projects can help them build trust with their internal team and policyholders.
It’s also important to note that the digital transformation process is ongoing and evolves as new technology emerges and policyholder needs change. Over time, insurers must continue evaluating their priorities to ensure their initiatives remain relevant and effective.
Digital Transformation that Shines
With the right approach, insurers can unlock the full power of technology to improve business processes, enhance the policyholder experience, and create new revenue streams. But they’ll also need access to the right tools and resources to help them succeed.
Powerful and cutting-edge tools like the Diamond System are expertly crafted for the insurance industry and help insurers unlock a competitive advantage and join the digital world with ease and precision.
Insuresoft understands the unique challenges that insurers face, which is why we’ve created Diamond, the only all-in-one insurance system you’ll ever need. From Policy to Claims to Billing – Diamond has been developed in-house for all P&C lines of business. It’s a natural fit for small to medium Mutual Carriers. Plus, Diamond has ZERO failed implementations and a 95% customer renewal rate. Nothing maters more to us than our clients’ success!
Contact us to learn how we can help you deliver the experience your policyholders expect in today’s digital world.
