The insurance industry is witnessing waves of innovation and disruption unlocking new business opportunities and customer-centric service relationships. Drones are flying overhead and collecting data; our homes are becoming models of internet-connected devices; and, of course, our trusty smartphones are increasingly integrated into every minute of our professional, personal, and social lives. It’s fair to say the age of intelligent technology is well upon us – and its influence is apparent everywhere.
In a recent article, Amit Ranjan, Xceedance EVP of Global Managed Services and Delivery, discussed the implications of emerging and intelligent technologies for the insurance industry. As innovations in automated technology increase, the trajectory of the fourth industrial revolution (4IR) is introducing and intensifying a world in which machines can talk to machines (M2M) to continuously refine complex sets of operational requirements without human input. Today’s technologies represent the nascent stages of smart technology transformations. As Amit explains, “It’s possible that future generations will point to virtual personal assistants such as Siri or Alexa, self-driving cars, virtual reality gaming and voice recognition software as among the early developments of the fourth industrial revolution.”
As with earlier industrial revolutions, today’s innovations will bring changes we can barely conceive today. Amit describes this period as both “a prime challenge and an opportunity” for insurers. As data sciences, intelligent technology and InsurTech business models increasingly push the boundaries of what is possible, creating more efficient and comprehensive systems for the insurance industry, these changes also create new challenges as stakeholders must learn to adapt.
While emerging technologies unfold, insurers face the uphill task of bridging the knowledge gap and instilling the talent and processes to leverage the likes of robotic process automation (RPA) and intelligence augmented (IA) and artificial intelligence (AI) solutions. Currently, the insurance industry is on a whirlwind learning curve. As a result, Amit explains, “The fast and transformative pace of 4IR is driving a shift in how insurers utilize and integrate service providers.” Whereas earlier, insurers had used service providers to handle menial, day-to-day responsibilities to lower costs, today’s managed services partners have become vital to bridge the gap between the promises of technology and the capacity of the insurer’s operations and IT capabilities to compete and succeed in the next phase of technology-enabled business and service environment. Amit’s observations are reflected in a Novarica IT Services Market Navigator report which highlights a propensity for blended models of internal and external resources used by insurers to meet the challenges of the InsurTech phenomenon.
As InsurTech and the next industrial revolution gains momentum across the industry, Amit offers insights on what insurers should look for in managed services providers. He suggests insurers should essentially try to replicate the same calibre of expert talent they would hire internally, instead of relying on generalist consultants in technology and platforms. Managed services providers with deep industry knowledge can help identify operational strengths and weaknesses and accelerate business optimization methodologies specific to the needs of insurers. “Service partners must understand exactly how core systems support business priorities and how new, 4IR-driven data and technology strategies can mesh with all types of legacy systems in the front and back offices,” says Amit. Insurers also need partners who are insurance data scientists so their skillset embodies a refined understanding of the magnitude and implications of vast and growing structured and unstructured datasets.
Beyond efficiency, hiring managed service providers with industry knowledge is also cost-effective. Rather than having to spend time and money training outside consultants on the nature of the insurance market, insurers can get started on the projects that matter most to them on day one. Moreover, they can ensure they are getting the support and the guidance they need to adapt to today’s changing environment and ensure they are well-prepared for the future. As Amit explains, this new relationship will come with “savings based on business and technology improvements that drive measurable transformation.”
Another feature of the relationship between insurers and managed service providers is the nature of engagements. Rather than hiring on the basis of one-off projects, insurers are increasingly viewing managed service providers as long-term partners. According to Amit, “Up until recently, many initiatives were conceived and designed to solve specific needs. But data ubiquity, IoT (internet of things) considerations, and digital customer demands are radically changing the business and transactional landscape of insurance. In blending internal and external resources, the relationship of insurers with service providers needs to focus well beyond specific, one-off projects.” Key to facilitating this longer-term relationship, Amit advises is outlining a “comprehensive plan” to effectively communicate both day-to-day logistics as well as strategic goals.
Leading the way in this evolving relationship between insurers and managed service providers, Xceedance provides comprehensive analytic and IT support across all aspects of the insurance lifecycle. The seasoned team of insurance experts at Xceedance help to navigate the evolving elements of emerging technology. In fact, Amit adds: “the relationship between insurers and managed services partners can also be seen as a vital cog in InsurTech initiatives—where experimental projects in digitization and the use of intelligent technologies can be incubated and accelerated to fruition with flexibility and agility.”
Read the full article here.