Digital Transformation in Insurance – A Paradigm Shift
Dec 3, 2021
The world is changing into a digital globe. We are advancing towards an era of reduced human intervention. Digital transformation is gradually and steadily penetrating different industries. Companies from all sectors are trying to re-invent their processes using modern technological solutions, and the insurance sector is no different. The industry is embracing transformation in the digital field to mitigate complicated challenges.
Digital Transformation in Insurance
Previously, the insurance sector did not seamlessly adopt new technologies. The ideas of enhancing workflows, processing claims the same day, or even migrating to an online interface seemed unimaginable until the digital transformation occurred in the industry. Consumers, nowadays, demand speed and instant claims processing which implies prompt and swift policy quotations, bill payments, and communication. There are innumerable instances of how the insurance division has changed due to digital transformation. For example, Underwriting and claims processing are powered by AI and IoT; customer interactions are done via chatbots, streamlined operations, automated claims processing, etc. These are a few boons of digital transformation.
Benefits of Digital Transformation in Insurance
- Cost Reduction: Traditionally, the marketing method was investing a considerable amount in infrastructure and advertising. With the advent of digital marketing, this high cost has decreased considerably. The insurance companies are being able to pass on benefits to the consumers due to this cost savings.
- Convenient Transactions: Modern customers require instant and swift solutions to their needs. Online transactions enable easy working of different insurance-related processes. Also, the entire process is simplified by digitizing the procedures associated with purchasing, renewing, and claims.
- Provides Safety: The electronic form of the insurance eliminates the risk of loss or damage to a policy, unlike paper insurance policies. Also, digital insurance reduces fraudulent activities.
- Brand Awareness: Insurance companies can use their applications, social media handles, text messages, and email marketing to enhance brand awareness among probable consumers.
- Increased Efficiency: Automation of claims management and underwriting increases the efficiency of the overall insurance procedures.
- Post Sales Service: While the customers might get the proper attention in the initial purchase, there is a general notion that consumers are forgotten once the policy is sold. With the rise in digital insurance, post-sales service such as raising a claim is hassle-free. Insurance companies are receiving feedback through their social media handles and acting promptly to resolve these issues. This way they are being able to furnish with a faster and better post-sales service.
The insurance sector must embrace digital change and discover innovative ways to optimize its operations to embrace a digitally advanced future. The insurance companies who will espouse early to the dynamic digital era will survive, those who will arrive late to the party will see their competitors escalate expeditiously.