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Insurers vs insurtechs – how do they measure up?

Insurers vs insurtechs – how do they measure up? | Insurance Business UK

Insurers vs insurtechs – how do they measure up?

There can be little doubt that COVID-19 has accelerated the move to a digital-first society, forcing many more traditional organisations to fast-track their data and digitisation journeys. According to Hugh Pelling, senior account director at the intelligent automation services provider Blue Prism, the crisis has highlighted the digital divide between traditional insurance firms and their more agile and tech-driven insurtech counterparts.

Find out more: Explore the full range of solutions available from Blue Prism today  

Offering an overview, he noted that, irrespective of the line of business they operate in, insurance organisations are having to evolve their traditional channels of contact and models of administration to keep pace. The current trend for change centres on the digitisation piece, he said, and is driven by the growing demand for insurers to serve their customers more quickly and more easily in the channel of their choice.

Read more: What does a technology-driven omnichannel experience mean for insurers and consumers?

“The companies that get left behind in this journey are going to see an impact on their bottom line,” he said. “Because end-user customers are more tech-savvy now, they don’t want to be stuck on the phone for hours trying to get to an outcome. What they want to be able to do is transact quickly, accurately, on first-contact resolution type models and I think that’s really key now. Most of the big, traditional insurers in the UK are recognising that they need to catch up with the more insurtech-type platform-based players.”

Hence, the challenge facing these organisations is not one of recognition, he said, but rather that they are finding it difficult to make the changes necessary to remain competitive internally. Pelling noted that this is a somewhat ironic concern considering that financial services giants have managed to swiftly and successfully re-engineer their businesses to adapt to remote working in a matter of weeks.

“So, their nervousness to embrace the digital journey seems to revert to their old tendencies of being very nervous of cloud, of digital, etc,” he said. “So there seems to be a recognition they must do this coupled with a reticence to do it. And ultimately, I think the key pain point is cultural, as insurance markets tend to be very traditional.”

Read more: Lloyd’s unveils next insurtechs joining innovation program

That’s not to say it can’t be done, Pelling said, and he cited the example of how Lloyd’s of London has undertaken a digital transformation journey that has seen it embrace multiple digital processes. Lloyd’s has recognised that if it is going to stay competitive as an insurance market, it has to embrace digital changes.

He noted, however, that a lot of retail insurers still face the same challenges of cultural nervousness around change, around moving to the cloud and around adopting new technologies. Their change programmes seem to be moving at a very slow rate, he said, even though COVID has shown that these organisations have the skills, technology and capabilities to make changes very quickly when they want or have to. They just need to utilise them more effectively.

“We at Blue Prism support this in a range of ways,” he said, “and perhaps the biggest area is around data lakes. Organisations have huge silos of data and, typically, have traditionally relied on very skilled people accessing that data quickly and accurately. Where Blue Prism comes in is that the digital worker can operate in that heavy-lifting data scenario, just like a human operative, but it is much, much quicker and much more accurate in how it collates that data.

“The digital worker can access that data quickly and accurately, to support a near-real-time scenario – for example, an underwriting lookup, or it could be a claims scenario. So, the ability to use our digital workers to connect silos of data quickly and accurately to deliver an outcome is a great example of how you don’t need to re-engineer all your data lakes and all your data platforms - you can typically use robotic process automation to access those disparate data sources, and then influence a process outcome.”

Now is the time for traditional organisations to act on their understanding of the fundamental role that automation, machine learning and AI are going to play in their strategic success, said Pelling. At Blue Prism, he and the team have established a best-practice process for helping firms to engage with these digital tactics  - ‘think big, start small, accelerate quickly’.

This starts with the analysis phase, he said, where Blue Prism works with an organisation to evaluate the processes which will give them the best yield once automated. This phase offers insights into where their process failings are, where they’re not meeting SLAs, where their customer experience is failing and where their customer effort is high. Understanding what those impact points are reveals which processes are associated with them, which, in turns, reveals why those failings exist.

“And then it’s a question of whether it’s a reengineering of a process that’s needed, or automation,  or a digital transformation journey around access to an omnichannel [customer experience],” he said. “And typically what we would say to organisations once that analysis has been completed and they’ve identified the initial tranche of automations and change needed within their organisation is, ‘make that change quickly, prove the point internally, bring onboard your automation and digitisation evangelists, and then really accelerate that change for your organisation’. And I’ve found that’s the best way to support organisations.”

Discover the full range of solutions available from Blue Prism here