Modernization is on the agenda for the vast majority of insurers today amid changing consumer expectations and a shifting definition of what a competitive advantage now looks like. A new report from Earnix – which partnered with the Market Strategy Group LLC to survey almost 300 insurance executives in North America, Europe and Australia – has now revealed that while insurers are prioritizing modernization they are struggling with its implementation.
Earnix revealed that while operations modernization was listed as one of the top five priorities of 87% of the insurance executives surveyed, nearly 90% of insurance carriers have not fully developed or executed their operations modernization strategy. Additionally, none of the respondents had fully executed it.
On a 10-point scale, insurers ranked the need for modernization at 7.6 – and this figure is expected to grow to 8.0 in the next 12 months. The report also revealed that while all insurance processes have important automation and efficiency needs, the pressing pain points are those of dynamic pricing, fraud analytics, and personalized add-on offerings. According to the report, investment will increase most in product personalization and telematics-based products.
Earnix noted that while insurers realize that many internal processes could benefit from modernization, rating, pricing and product personalization were ranked at the top. Meanwhile, advanced simulation, real time monitoring, AI with machine learning at the point of interaction, and automation are all key for carriers to provide the personalized offers that their customers crave.
“Carriers have realized that they must prioritize insurance operations modernization,” said Dror Pockard, chief strategy officer, Earnix. “Technology partners with interoperable, connected, and easy to deploy solutions that offer fast return on investment can leverage carriers’ existing investment. Adopting new technology is critical to help insurers to improve customer experience. The time for modernization is now; any delay will harm carriers’ ability to achieve their business goals.”