How Insurers Can Emerge Strengthened from the COVID-19 Crisis

As insurers assess and address challenges within their organizations, they are not only solving today’s issues, they are building a more resilient operating model for the future.

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The current global COVID-19 pandemic has tested the limits of so many industries, and insurance is no exception. Customer inquiries have spiked. Servicing operations are struggling to keep up. Unemployment rates have reached levels not seen since the Great Depression, and customers are having trouble paying their premiums. To make matters worse, pandemics are not covered by most policies.

The insurance industry was built to protect people from loss due to unforeseen circumstances and today, policyholders need to know insurers have their backs. But with complex inquiries on the rise, many insurers are struggling to keep up with the demand.

In the midst of this chaos, what can the industry do to respond in the most appropriate and timely way? What about customers who are unable to pay their premiums? And how do organizations ensure their reps are adhering to emerging industry regulations related to COVID-19?

For the insurance industry, customers are always a top business priority, but so is business continuity – especially during unpredictable times. Insurers need to balance empathy for policyholders with the fundamentals of keeping the business afloat.

Here are some thoughts on what insurance providers can do not only to survive this pandemic, but to come out stronger on the other side.

Accelerate query response times

Policyholders are reaching out with time-sensitive questions, and they want immediate answers. Can they defer payments because they’ve lost their job? Can they withdraw funds due to recent hardships? Can they recoup any of the value from their struggling business or indemnify some of the losses they’ve had from COVID-19?

Keeping up with these requests is challenging, especially when insurers have a distributed workforce who may have previously relied on manual, disjointed processes to do their jobs. Companies like Nationwide Insurance just announced their employees will continue working from home indefinitely, and many other insurance companies are likely to follow suit. Remote frontline employees need access to customer data and automated tools to do their jobs effectively, since they can’t just shout across the call center with a question the way they used to.

Redirecting some inbound queries to other channels can help. For instance, by using email bots that incorporate natural language processing, emails can be automatically read, classified, and assigned to cases to help agents provide more timely answers. This means fewer phone calls, less burden on staff, and more satisfied customers.

Proactively retain policyholders

During economic downturns, policyholders may be struggling to pay their premiums. Given the rising unemployment rates, things are likely going to get worse. Instead of waiting for inbound requests from customers, insurance providers can get ahead of the issue by proactively addressing the problem head on. To do that, they need insight into each policyholders’ situation. It costs far more to replace a customer than to retain a current one, and even if a customer is struggling now, it doesn’t make them less valuable in the long run. In addition, not everyone will be affected equally by the crisis and there will be times when it may be appropriate to personalize sales offers based on a policyholder’s unique needs.

This is the time to empathize with customers and determine what can be done to maintain continuity of coverage. It might mean restructuring billing processes to consider temporary deferments, or other preemptive measures to alleviate some of the burden on policyholders. But unless insurers know each customer’s individual situation—by having a holistic view of their payment and purchase history and an in-depth profile of interactions with the organization—insurers are making decisions about them without any context.

Stay resilient in a crisis and beyond

While the volume of customer queries has surged, not all queries are as urgent as others. Companies need an automated way to triage and prioritize these crisis-driven requests regardless of channel to restore order and improve customer service overall. It’s also important to be able to expedite special exceptions that agents have never dealt with before and track those queries with a full audit trail to maintain regulatory compliance. But to do this successfully, agents must have access to digitized customer data that can be shared in real-time.

While it may seem like COVID-19 has created new problems for insurance companies, it has actually shined a spotlight on the issues that already existed. As insurers assess and address challenges within their organizations, they are not only solving today’s issues, they are building a more resilient operating model for the future.

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Tom Harrington // Tom Harrington supports Pega’s global strategy for the insurance market and has more than 20 years of insurance industry experience. He works with leading carriers on innovation, profitable growth, digital transformation and policyholder engagement initiatives. Prior to joining Pegasystems, Harrington led product development, distribution strategy and technology initiatives at Liberty Mutual, and was a commercial lines insurance broker at Aon.  

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