Capgemini recently published their 2018 top 10 trends in property and casualty insurance and one of the trends they identified was automation of processes leveraging Robotic Process Automation and Artificial intelligence.
This trend encompasses both automating processes based on unstructured input (like a chatbot interacting with customers as they type in questions) and automating processes based on structured input (like machine underwriting of an insurance application).
For this article, we will focus on the structured input scenario. By extending reach directly to the insured, a digital channel with robotic process automation makes it possible to have complete automation of a process like the purchase of an insurance policy or submission of a claim. Lets look at an insurance application process and how it can be automated using an insurance program as an example.
Going digital does not mean just taking your current application form / rules / rating and moving it online. To be fully optimized in a digital channel, the application questions need to be examined to ensure they support a machine underwriting process. As an example, it may have been fine to ask a free form text question like: "Describe your work experience" when a human was reviewing and underwriting each application but in order to take advantage of automated underwriting rules, this question needs to be made more structured like: "Enter the number of years experience you have" so underwriting logic can be implemented based on a numerical threshold to separate out a startup vs a mature company.
Offering the insurance product online means the insured is the one that will be filling it out. By automating the underwriting and rating rules, any applications that fit the normal cases will pass all system rules and have a quote presented. Only special cases will be routed for human underwriting.
For the normal cases, the insured is instantly presented with a quote and can purchase with a credit card. Upon confirmation of payment, their documents will be bound and issued.
As a result of process automation, the insured gets what they expect in today's digital economy - for the normal cases their entire purchase interaction was done in a few minutes. The insurance provider realizes tremendous efficiency gains by only having to have their staff get involved in the special cases. Based on real world usage, we have seen 90% to 95% automation possible. This means for the book of business in the program, only 5% to 10% needed to be touched by staff - the rest were completely automated from the start of the application through to issuance of the policy. As you can see, this offers significant internal efficiency gains and scalability potential - especially for large programs with a common renewal date. It also lays the foundation for new business models such as offering insurance in other point of sale channels or basing rating/coverage on Internet of Things (IoT) device data.
Click Capital enables companies in the Property and Casualty insurance space to go digital with our cloud based digital insurance system, InsureVue. Built on the industry leading Salesforce platform, InsureVue allows insurance brokers, managing general agencies (MGAs) and insurance companies to digitally transform their businesses.
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