What does “omnichannel” stand for in life insurance sector?
Omnichannel is an approach that enables life insurers to provide integrated seamless experience to their users across the value chain starting from engagement to claims. The user, both internal and external, could use different mediums to derive value through smooth and seamless experiences.
Life insurance sector has undergone significant transformations
Long time ago, they believed that low-frequency interactions regarding policy renewals were sufficient to sustain customer relationships and serve customers. Yet, over the years it became clear that this industry has been shaped by other industries too, including retail industry and omnichannel servicing.
Omnichannel data servicing integrates and synchronizes all channels through seamlessly shared information, highly automated processes, well- designed technology environments, unified data, as well as advanced tools for analytics.
It’s worth mentioning that demographic changes are triggering this shift too. Millennials are the face of the future life insurance, and they are accustomed to the brand new world that allows them both to purchase and obtain service digitally via any channel or device. Thus, such a close relationship results in stronger customer engagement, increased process efficiency, and lower costs.
Although there are certain challenges: life insurers face substantial challenges in modernizing their technology infrastructure, reworking processes and aligning the entire organization to operationalize the omnichannel vision.
What are the elements of the newly defined consumer expectations?
Omnichannel servicing is turning into a common practice in retail. Customers can track orders online, return or exchange online purchases at a store, etc. In banking, customers can easily change their address, view balances and pay bills online.
As for property and casualty insurance, carriers use telematics data to personalize communications and service and to provide safe driving benefits. Using mobile apps to streamline the claims process with intuitive tools for submitting information enable them to receive status notifications and perform other tasks.
To illustrate, one insurer has developed a platform that gathered all customer transactional information into a single historical record (data from multiple product lines and all touch points, in-person interactions with agents, claims and policy updates). Moreover, due to the visibility improvement, it became much easier to serve customers in the most efficient way possible.
There’s no doubt, integrated omnichannel experiences are more efficient when they feature well-designed technology environments, specific advanced tools, integrated data and effective data management capabilities.
When one think about the future innovative tendencies in the sector, it’s of vital importance to consider the following top areas for investment:- Process and workflow automation;
- - Management and governance of information assets to help maintain accuracy and integrity;
- - Tracking, mining and reporting capabilities;
- - Ability to rapidly and securely make the right data available anywhere and anytime.
To preserve the competitive edge, insurance carriers must overcome their traditional reluctance to change and adopt broad-based transformation. More mature omnichannel service capabilities will provide clear differentiation for insurers that can develop them.
The journey starts with investigating current capabilities and identifying and prioritizing opportunities to build new capabilities for omnichannel data servicing. The good news is that insurers already enjoy the opportunity to leverage multiple data sources to create deeper customer relationships and to become more efficient.
Hence, the future of insurance will be determined by the wide range of factors, including, but not limited to:
- - Integrated ecosystems to create new risk pools and monetization opportunities;
- - Digital adoption to enhance access to data and raise process efficiency through RPA/AI
- blockchain to cut down cycle times and improve reliability of processes and transaction;
- - Big data and analytics to make sense of the vast amount of generated data.
The pace of digital acceleration is set to continue in the insurance industry in the years to come
The changes in the insurance sector are inevitable. Autonomous vehicles, wearables, IoT are among the numerous upcoming changes. No wonder that technology is changing the nature of risk and is introducing new products, services and channels to the sector in general. To succeed in the newly shaped environment, both experiences insurers and newcomers will have to convert into the driving force behind the creation of digital ecosystems.
The final objective of combination of disruption and digital adoption is that cross-sector convergence is becoming increasingly important, leading to a substantial transformation of traditional value chains, as well as triggering the necessity to enter in new types of partnerships.
In this environment, insurers need to respond quickly by shifting from short-term contractual relationships to long-term collaborative relationships, as well as by defining their role in future ecosystems by assessing role of emerging technologies.
At the same time, to be in line with the emerging ecosystems, insurers need to improve their advanced analytics and predictive capabilities, which, in their turn, enable dynamic pricing, risk mitigation and product innovation.
Major technology shifts: IoT improves access to data and enhance operational efficiency
Greater proliferation of sensor-based technology, increased automation and AI are allowing insurers to develop a much stronger understanding of the overall insurable landscape.
It goes without saying that IoT and automation are no longer considered as an innovation but have now emerged as the core components of an insurer’s survival and growth toolkit.
With original equipment manufacturers using embedded telematics devices in recent years, insurers dependency on OEMs and solution providers has grown. Also, strong focus is seen on improving data quality as several leading insurers, auto players and technology start-ups already have a wealth of data at their disposal.
Among other categories, connected health is witnessing a major interest with major technology, pharma and retail players announcing plans to enter this space in a big way, while several insurers are also investing heavily.
Omnichannel data experience is essential for it not only increases customer satisfaction, but also improves distribution relationships.
Achieving customer delight will make the customer loyal to the insurer, whereas, achieving advisor loyalty will certainly help insurer to build a strong distribution network. The need to offer enhanced service experience to intermediaries will increase as the ageing distribution workforce will retire and a younger, tech-savvy generation will replace them.