Digitisation cannot be reactive

To truly unlock the digital potential, insurers need sustained investment in innovation and new-age technologies like machine learning, data modelling, and artificial intelligence

If you have recently purchased an insurance product, you might have been pleasantly surprised by how much smoother and quicker the process is now, compared to how it was a few years back.

It is now possible to purchase an insurance policy over your mobile phone in a few minutes, without ever talking to anyone. Right from seamless customer on-boarding to filing claims online, to using big data to understand the customer and the risk better, technology is now embedded in all stages of an insurance policy lifecycle. User-interfaces are getting more intuitive, be it a website, mobile app or chatbot, and access to information is getting much easier.

For instance, in auto insurance, the buyer just needs to feed in the vehicle registration number and insurers are able to assess the risk and issue a quote without the buyer having to enter any other details; all these get fetched via integration with various third-party databases. Customers can also instantly make changes to their policy details, using the self-service functionality on the insurer’s website or mobile app. Real-time surveys of vehicle damage, by customers using the mobile app, and backed by automated claim adjudication data models, are enabling instant claim settlement.

The new-age customer demands omni-channel access to policy information and it is imperative for insurers to enable journeys that provide similar unbroken experience to the customer across all their touch points — branches, call centres, websites, mobile apps and intermediaries — by digitising processes that drive these interfaces.

The purchase decision journeys of customers have also undergone a significant change, and social media platforms have started playing an increasing role in decision making. Organisations have also recognised the importance of customer reviews on such platforms, and have accordingly started building their presence out here.

The digital quotient of the insurance industry has moved up over the last decade. And this journey has been accelerated in the last year after the outbreak of the Covid-19 pandemic.

However, digitisation cannot be reactive, and neither can it be done in silos, if one wants to impact the customer’s experience across the complete policy cycle. Insurers need to take a long-term strategic view if they want to truly unlock the digital potential. This means sustained investment in innovation and new-age technologies like machine learning, data modelling, and artificial intelligence. Often, it calls for rebuilding experiences and journeys from scratch, instead of incremental improvements to existing processes and applications.

For the customer to experience the complete impact of digitisation, insurers will also need to work with their other stakeholders — intermediaries, hospitals, garages and various service providers — to ensure that each of them are well-enabled digitally to facilitate seamless coordination between them.

Insurers who want to be at the forefront of this digital revolution will need to reimagine their operating ecosystem to support both physical and digital engagement with the customer with the same level of customer experience.

A word of caution, though. It is easy to get carried away with technology and the problems one expects it to solve. While there is no doubt that the insurance industry is heading towards increasing levels of digitisation, each insurer will need to decide the degree of digitisation that works for them and their customers. Technology and the human touch need not be mutually exclusive, and in the finality of things, customer expectations will dictate technology strategy.

Data-driven strategies can ensure that the business delivers the most compelling message, addressing the right buyers, their deepest pain points, at the right time, through the right platform, while establishing a clear call-to-action to close the feedback loop. That said, even in a digital world, the customer will remain king.

The writer is Managing Director and CEO, Tata AIG General Insurance