A while back, our CEO Arun Balakrishnan shared his thoughts with the Insurance Technology Association (ITA) on changing business and workplace trends in the insurance industry. It’s a timely topic, so we wanted to revisit it in our blog.
Arun was featured as a guest commentator on ITA’s website. He spoke about the “new world of work” as well as the ways insurers will need to adapt in order to stay competitive in the future. He observed that in today’s business environment, insurance companies are faced with the task of providing round-the-clock service, flexible products and billing options and better accessibility to information and service — all without increasing costs. He outlined how insurers will need to mobilize their employees, create self-service opportunities and externalize back office operations.
Arun explained that in order to grow their existing business, launch new lines of business, or simply increase efficiency, insurance organizations must consider a more distributed work environment, including a combination of full-time, part-time, mobile and contract employees.
“By allowing employees to work remotely, insurers can begin to reduce an expensive physical footprint and measurably decrease operational costs,” he wrote. He added that the flexible work environment will also be attractive to younger workers who are now replacing the baby boomer generation in insurance operations.
He also said that consumers, conditioned by experiences offered in other industries, are demanding more accessibility and increased self-service options, and insurers are struggling to adapt legacy systems to meet immediate needs. Many insurers today are choosing to implement direct-to-consumer capabilities, such as portals as a kind of quick fix in lieu of replacing or upgrading existing legacy systems.
“The important thing to consider in any new initiative is what it may add to the bottom line, or how it impacts the company’s ability to be more customer-centric,” he advised.
Finally, Arun highlighted how insurers are increasingly turning to third-party providers for at least some functions, such as policy servicing, accounting, finance or claims. Externalizing back office operations can allow insurers to better allocate full-time employees to tasks more focused on the company’s core competencies, such as developing insurance products, providing coverage and protection for policyholders, and servicing in-force policies.
“While outsourcing has always been something of a dirty word in the insurance industry,” he said, “when done in a responsible, measured way, it can further enable an organization’s ability to scale rapidly.”
A full transcript of Arun’s article is available here.
For an interesting perspective on human capital trends in the insurance industry, click here.