Accelerate Underwriting with Data-Driven Process Improvement

Insurers must move beyond the traditional approach of automation supplemented by manual processes to one of digitization and the integration of alternative data into core underwriting processes.

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Prior to the pandemic, digital transformation was well underway in the insurance industry, but the last year has further changed the way insurers must approach underwriting. The traditional approach of automation supplemented by manual processes is not going to drive the level of profitable premium growth that insurers need to thrive in a hardening market. Insurers must digitize and expand their capabilities while looking to integrate alternative data into core underwriting processes.

The last 12 months has certainly exposed more gaps along the way, even for companies who were already working in the modern era of automated underwriting. Insurers have had to pivot to manage virtual interactions and exchanges of information between all stakeholders in the process. Deloitte forecasted that, depending on how the pandemic plays out, historical data may be less valuable to the underwriting process, insurers might face unexpected spikes in claims, and insurers who take an agile approach to risk assessment might be more resilient than those who do not.

As the insurance industry, known for its heavy use of paperwork, continues to ramp up automation at a rapid pace, carriers must ask themselves how they are optimizing the processes where gaps exist.

The Amount of Unstructured Data is Only Growing Faster  

While automated underwriting is a step in the right direction and can evaluate a lot of data at once, there is still a large amount of data that is creating a massive area of vulnerability. This can allow cracks to form in the system and, since the pandemic, several examples of gaps and broken processes have emerged. One insurance carrier, for example, focused process automation on improving the customer experience, while gearing up for automation at scale. However, when employees began working from home, operational processes supporting critical outcomes became difficult and many were simply broken.

Every day, insurers have to deal with massive amounts of data in various paper forms. As soon as data enters automated underwriting—whether for personal lines, commercial, or life—it feeds into many manual processes, often resulting in a delay in the process, an incorrect decision, or both. In today’s digital age, companies may have automated systems in place for their structured data, but they lack digital solutions capable of addressing the volume of data from documents.

Additionally, with more and more consumers preferring to transact digitally, there is now an even greater emphasis to accelerate the digitization of business and operating models across the front, middle, and back office. The significant gap between customer expectations and insurer’s abilities is driving insurers to push for better connections, including their people, processes, and customers. Those who move fastest will reap the competitive advantage.

Optimizing Processes with Process and Content Intelligence

Digital transformation has changed the way things are done in insurance, revolutionizing customer relationships with new technology experiences. Yet, insurers are struggling with identifying the best opportunities for automation for ultimate customer experience. To overcome this, they need a better understanding of current document-driven processes.

Process automation is seen as playing a critical role in driving digital transformation, but often falls short in part because carriers see digitization as the route to solve specific business problems without realizing that it must be the core of a holistic framework.

Process intelligence can help you see your processes as living in real-time and discover where bottlenecks occur, where repetition happens, where data is missing, and where automation is working or not. It can also see the flow of documents and their data through your processes, identifying exactly where automation—additional technologies like Artificial Intelligence (AI), Robotic Process Automation (RPA), and Machine Learning (ML)—can make the biggest impact. Too often, business leaders simply guess which processes would be best to automate without leveraging real data.

Successful digital transformation initiatives that have the highest impact require more than just RPA tools; this includes content intelligence to improve process bottlenecks, strengthen operational efficiencies, enhance the customer journey, and free employees to focus on engaging and meaningful responsibilities. Content intelligence solutions are now enabling enterprises to make unstructured content more valuable and equip digital workforces with the necessary skills and understanding to make intelligent business decisions.

Strategic, Holistic Approach

This powerful combination of technologies can process a wider variety of documents more precisely, and can automate insurance processes end-to-end – from downloading, classifying, and compiling data from external sources to extracting and analyzing similar data from multiple sources to determine and mitigate the risks associated with the chosen policy. Implementation of intelligent solutions to underwriting can significantly speed up functions such as data collection from both external and internal sites, assessment of loss runs and engineering reports, reviewing the history of customers’ claims and producing recommendations based on previous losses.

With a strategic, holistic approach to implementing transformation and leveraging digital technology, insurers that commit to this approach will reap near-term rewards across the board and set the pace for the industry for years to come. Overall, the potential for automation in the industry is limitless and can transform your operations, completely elevate your employee satisfaction, and improve the customer journey.

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Eileen Potter // Eileen Potter is Head of Insurance at ABBYY, a digital intelligence company. She has more than 25 years of insurance and insurance technology experience with extensive knowledge of commercial, personal, and specialty lines, including insurance operations on both the agency and company levels. She has worked in independent agencies and MGA operations in a variety of roles, including commercial marketing and underwriting. Her software background includes systems marketing, sales support, and implementation roles with organizations such as Appian, One, Inc., Duck Creek Technologies, and Fiserv, among others.

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