Core Insurance, Risk Management
Article | September 22, 2022
Since 2010, as countries waded out of the recession of 2008, they enjoyed economic growth. Coupled with technological innovation, the global economy really got a boost. But, mirroring Nature’s cycles, it seems it is now time to hit a plateau and slow down. In this article, we explore why the slowdown could be happening and more importantly, what it means for us in the insurance industry.
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Insurance Technology
Article | July 15, 2022
Despite ongoing concerns about COVID-19 variants, most insurers anticipate a faster economic recovery and increased investments in digital technology in 2022. One-third of those polled expect revenues to be "significantly higher" next year. The global demand for insurance is expected to rise further.
Insurers face a variety of challenges, including economic hurdles such as the possibility of sustained inflation; sustainability concerns such as climate risk, diversity, and financial inclusion; and rapidly changing consumer product and purchase preferences.
Attracting (and Retaining) Talent Will Be Critical in a Hybrid Work Environment
Future of work considerations have also grown in importance as carriers strive to develop flexible return-to-office strategies while also struggling to retain and recruit high-level talent in a highly competitive job market, particularly for those with advanced technology and data analytics skills.
Insurers Must Find a Way to Balance Technological Adoption with the Preservation of the Human Touch
Insurers are becoming more reliant on emerging technologies and data sources to increase efficiency, improve cybersecurity, and expand capabilities across the organization. Most, however, should focus on improving the customer experience by streamlining processes with automation and providing customized service where needed and preferred.
Opportunities to Increase Stakeholder Trust Have Arisen as a Result of the Pandemic
On a more fundamental level, many carriers should consider taking steps to increase stakeholder trust in order to increase retention and profitability. This could be accomplished in part by increasing transparency in how insurers collect and use personal data. They can also become more proactive in seeking comprehensive solutions to large-scale societal issues, such as reducing the financial impact of future pandemics and closing coverage gaps for natural disasters.
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Insurance Technology
Article | July 19, 2022
The worldwide marketplace is undergoing a host of structural changes and insurance companies are consistently working to capitalize on them. The past few years posed a number of new challenges. For an industry whose primary promise is to “be there when customers need us,” delivering top-notch timely services is not only crucial for business continuity but the most urgent goal. Inspiring trust through every process of the policy lifecycle is a significant factor for insurers to be able to maintain goodwill in the market. Recent pressures proved that the industry needs a systemic metamorphosis and digital solutions may be able to provide them.
This is also why many industries are jumping on the bandwagon of digital transformation and insurance is no different. With a barrage of new technologies, solutions and software, it has become easier to automate processes and eliminate inefficiencies that hamper day-to-day-operations. One such area of transformation is insurance policy management. Forward-looking insurers today, can start by rethinking their policy management framework.
The Importance of Automated Policy Management
Simplifying all internal processes is a priority for many insurance providers worldwide. Much of the insurer’s business outcome hinges on streamlined workflows, seamless document management and effective use of different tools. In policy management, mitigating risk is another significant aspect that impacts the bottom line. Today, insurers are heavily investing in new technologies like artificial intelligence and machine learning, robotic process automation, data analytics and much more.
Policy management entails the comprehensive process of administering policies. From pre-sale to renewal to claims, at every stage of the policy lifecycle, insurers must ensure a smooth process at every stage. Some of the stages of policy management that can be enhanced by using automated policy management tools which include:
Member services
Loss mitigation
Risk assessment
Claims processing
Policy issuance
Policy renewal
Policy cancellation
Compliance
It’s clear that insurance policy administration system (pas) encompasses all the main business processes of an insurance company and the importance of policy management is enough to invest in high-quality solutions that span the policy lifecycle.
The Must-Haves of Policy Management Software
A smart insurance policy management simplifies the process for both the insurer and the insured. For insurers, it should be able to optimize resources and save time in administering policies. For example, life insurance policy management system can help a provider scale their operation, introduce flexibility and administrative simplicity. Here are the components of a policy management solution that is a must-have for every insurance provider. For the insured, the solution can help organizations not only provide a smooth experience
Policy Issuance, Update and Cancellation
The most significant must have that an effective policy management solution should have, is the ability to digitalize every aspect of policy administration. This includes being able to generate documentation, centralize records and oversee all operations across the policy lifecycle.
For instance, everything should be synced so that any updates are made universally across all documents. This eliminates doing manual changes to all the records. In addition, with technologies like robotic process automation (RPA), repetitive tasks can be automated and reduce the time it takes to process documentation.
Underwriting
Underwriting is a process where individuals or firms take financial risk for a fee. In insurance, underwriters are responsible for evaluating the degree of risk to the insurer’s business. It is in essence a manual process that comprises extensive research and assessment of the prospective policy holder. For instance, medical underwriting consisted of ascertaining the charges to levy or even whether to provider coverage to them based on an applicant’s health condition.
Even though underwriting is a time-consuming process, it doesn’t have to be tedious. Underwriters need to access data that is spread across a range of different platforms and sources. Automated policy management enables organizations to accelerate the process of data collection and collation. This is why, automation in underwriting functionalities is one of the most important features of a policy management software that is a must-have.
Estimates and Quotes
Holistic policy management tools are incomplete without quote estimate capabilities. Quoting allows insurers to generate leads. With automated quoting features, insurers can provide estimates without having to directly contact customers, saving time and money in cold calling. In addition, it helps insurers to gather the information they need to then target their leads and tailor solutions that meet consumer expectations.
Quality policy management systems include these capabilities. They work by letting customer input their information and receive a quote estimate based on it. For insurers, in addition to providing leads, it lets them engage customers from the start itself.
Policy Renewal
Renewals is a critical stage in the policy lifecycle. Overseeing renewals and reducing customer churn is something every insurer must prioritize. Renewals handling amplifies the importance of policy management software that offer renewals management tools.
Renewals management features allow insurers to alert policy holders about the ending of their coverage and provides a timely reminder to renew it. Since renewals management tools offer ready information for insurers to access, customers need to update fewer fields. It not only reduces customer churn but contributes to an easy, fast, and customer-friendly process.
Claims Processing
Claims processing is when an insurer reviews a claim process to verify and authenticate the claim made by the policy holder. As a core business process, claims management and processing needs intelligent systemization. Insurance policy management tools that integrate claims processing will enable insurers to automate the settlement process.
Modern policy management tools sync different systems so insurers have a centralized database and can simplify tasks like assigning claims, detecting fraud, record payments issued and automatically generate reports.
Regulations and Compliance
Insurance is a heavily regulated industry and insurers must keep up with the many compliance and location-specific regulations to avoid hefty fines. Regulatory policies are also subject to change and can often realign processes to protect consumers. This may sometimes cause insurers financially. However, complying with new regulations is a business necessity and policy compliance management solutions help immensely.
Insurers must be able to monitor any changes in global and local policies or keep an eye out for announcements regarding the change in rates or regulations. Many insurers have a team to do this but maintaining a team is costly and causes operational complexities.
Modern policy management tools offer the automation capabilities that eliminate the need for extensive overhaul or insurers to keep up with new regulations. These policy compliance management tools help in detecting breach and minimizing it. They also enable better resource allocation as teams no longer need to monitor new and upcoming regulations and plan for implementing the change.
Customer Support
Customer support is one of the most critical aspects of policy management. Beyond software and applications, being able to meet your customers’ demands, address their concerns throughout the customer lifecycle is vital in order to meet business objectives on time.
With digitalization transcending platforms and devices, policy management tools today need to be able to keep up to meet customer demands. This is why mobile-ready policy management solutions are a must. They allow insurers to respond to customers quickly and keep channels of communication open and flowing. In addition, features like quoting estimates and claims processing that accelerate policy administration and management in a streamlined manner are bound to keep customers happy and reduce churn.
Some policy management tools come with marketing automation capabilities as well as a CRM that lets insurers deliver a great experience right from buying decision to ongoing support.
Conclusion
There is no denying that digitalization is the future and insurers need to be ready to adapt to new challenges and evolving demands from consumers. Policy management tools not only enable insurers to overhaul their core process but simplify it and eliminate operational inefficiencies.
The importance of policy management cannot be understated. Age-old challenges and bottlenecks of managing millions of policies can be mitigated with comprehensive policy management solutions. The above components are the most critical process your organization should look to simplify. These essential features ensure you are able to optimize resources, improve operational efficiencies, streamline processes and translate all these into enhanced customer experiences.
Frequently Asked Questions
How does insurance policy management differ from other policy management tools?
Insurance policy management is a specialized solution that caters to insurance companies and enables them to manage renewals, claims, underwriting and all other processes associated with managing an insurance policy for their customers. Other policy management tools help organizations frame policies and management internal policy documents.
What is an insurance policy lifecycle?
An insurance policy lifecycle starts with generating a quote for the customer, onboarding the customer’s application, and finally setting the payment of premiums and renewals. When a policyholder claims insurance, the insurer has to process the claim, verify its authenticity then accept the claim fully or partially or reject it.
What are the ways the insured can choose to pay for the insurance policy?
The insured can either pay a lump sum amount or choose to pay monthly, yearly or quarterly. These payments are called premiums and are calculated based on certain condition set by the insurer.
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Insurance Technology
Article | July 19, 2022
The pandemic pressed many businesses to go remote. While this enabled employees and their organizations to continue doing business in the face of global uncertainty, the fragility of cybersecurity infrastructure became more apparent than ever. From remote work to a more powerful online presence, cybersecurity threats are a significant challenge for many organizations. With data security, exposure to these threats meant cyber insurance needed to be amped up.
In the race to fortify cybersecurity, small businesses, which have limited resources to train their IT staff, have much catching up to do. As a matter of fact, practically all small businesses maintain sensitive data on their staff, clients, or suppliers, making them open to hacking attempts, malware attacks, digitalfraud, and other online threats. A cyberattack can force a firm to cease operations, incur significant losses, and unanticipated costs, and harm their brand. This is why cyber insurance is so critical.
Here are four things SMBs must understand about cyber insurance and what it covers.
In Case of Data Breaches
Data breaches are one of the most common types of cyberattacks on small firms. Cyber insurance coversthe cost of locating the origin of a data breachand assessing whether the information lost poses any legal obligations. It also includes the price of meeting those obligations, including sending notifications to affected clients, setting up a call center, and providing credit monitoring, as well as the price of hiring legal counsel and paying any fines or penalties.
In Case of Malware Attacks
Ransomware and malware attacks allow criminals to break into an organization’s back-end data. They use it to steal customer information or simply encrypt it which allows them to demand random from the business to reclaim access. Cyber insurance can pay for all of the expenses involved in restoring the system, including recovering data, ransomware removal, vulnerability patching, and, if required, paying the ransom itself. A ransomware attack is the most disruptive,and it may be covered if there is economic loss for the company.
In Case of Phishing and Cyber Fraud
By gaining access to a company's computer system, social engineering letscriminals trick employees intosettlingfictitious bills or diverting cash to their accounts. Businesses may be able to recoup lost funds with the use of cyberinsurance.
Third-Party Coverage
Third-party insurance can shield firms from cyber-related legal troubles, such as government responseor class-action lawsuits brought on by, for instance, unintentional malware spreador the inability to curbunauthorized access to companysystems. It covers all legal expenses, such as settlements and lawyer fees.
What’s the Bottom Line?
Cyber insurance cannot be an alternative to a robust cyber security infrastructure. And small businesses cannot afford to keep vulnerabilities in their systems. Many cyber advice solution providers offer advisory and risk assessment services that may be just what small and medium-sized businesses (SMBs) need to start improving the security of their systems.
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