Whether insurers like it or not, digital transformation is coming to the industry. It's all thanks to insurance consumers.
The insurance industry is traditional and highly-regulated. It's found the digital tools and processes that have worked for its workforce. Much of that technology is now antiquated. The employees who put those processes into place are on the verge of retiring, leading to a potential insurance industry talent crisis.
Customer experiences (cx) in many other industries have quickly digitized. It's what is now expected in any customer-facing interactions with any business. If you don't provide customers with the experience they've come to expect, they'll turn to your competition.
The push for digital transformation has now accelerated in the insurance industry. Processes are moving faster and customer interactions are more automated and personalized. AgentSync says the industry has begun with digitizing existing processes. Now, the industry has started to find use cases for new innovative insurance products.
Insurance companies are still figuring out their digital transformation and CX strategy in this phase. But no matter what their business models are, there’s a connective tissue. Digitizing the industry is driven by how businesses can improve and streamline the insurance customer experience.
If you want to know how insurtech is reshaping insurance, just look at the change in customer expectations. Digital technology has given customers control over their interactions with businesses. As Voxco writes, a good customer experience is what paves the path for the growth and success of a business. That's because people have come to expect the Amazon experience with every organization.
They want their product or service quickly and efficiently. In fact, Birlasoft reports that 88% of insurance consumers now want a personalized offering. If insurers don't rise to their level of expectation, they'll lose their customer base.
It goes to show that a positive customer experience is what sets businesses apart from their competitors. With insurtech startups posing a rising threat to traditional insurance companies, those agencies need digital to keep up. It's likely why Birlasoft states that insurers' investment in technology is expected to grow at 16% CAGR by 2023.
With legacy systems and highly-regulated processes, the industry is slower to adapt to new technology from insurtech companies. But the window to jump on the digital bandwagon is closing. If you miss out on the opportunity to embrace change, your customers will pay the price. But with the right mindset, you can leverage your digital transformation strategy to improve and accurately measure your customer experience strategies.
Source: Robosoft Technologies
Only 29% of insurance consumers are satisfied with their providers, due to poor customer service experiences. Needless to say, the industry's reputation is in need of a facelift. Digital transformation can help in the following ways.
Not can technological initiatives improve your digital customer experience, but they can also improve your business revenue. Businesses can increase revenue by 20% - 50% just by undergoing digital transformation.
Insurance’s slower-moving digital transformation isn't because the industry doesn't want to embrace digital. As Insurtech Insights writes, it's because the insurance workforce simply has more hoops to jump through in the digital transformation journey.
For one, larger insurers may be left with a layered infrastructure of software that is difficult to integrate with newer insurtech solutions. On top of that, insurance companies have to prioritize staying up to date with regulatory requirements. Finally, many members of the insurance workforce don't have the digital skills to help propel digital transformation within their organization.
But there are ways to move forward at a steady pace.
No one’s expecting the industry to change overnight — it's going to take time. But starting to incorporate small and meaningful changes will show your customers that you’re willing to meet their digital expectations.
This will prove to your customer base that you’re more in tune with their needs than your competitors. You’ll see the benefits of digital transformation in no time.