By Ratika Gupta
The modern insurance business faces multiple new and unique challenges, from keeping up with regulatory reforms and rapidly evolving customer needs to facing increased market competition from new, digital-first entrants, all while searching for the next generation of talent in an ultra-competitive labor market.
The good news: Managing risks and facing new market challenges are core competencies for insurance businesses, and most have established systems and approaches in place to identify, prepare for, and mitigate risks when they happen. This concept of “business agility” regularly leads to a re-analysis of business needs, leading insurance CXOs to find new and streamlined ways to manage investments, people, and technology. One approach helping organizations and business leaders adapt to new operational realities is the growing slate of on-demand services tailored to the insurance industry.
On-demand services make business agility easier
Imaging an insurance business is looking to expand into a new geographic market. Under the traditional, non-agile, approach company management would have to locate and hire new people in that market, set up an infrastructure, procure technology (and people who can support it), and complete many other critical, foundational tasks. If each step is handled internally the expansion would require significant capital and time.
By leveraging an agile method for market expansion, insurance CXO’s can future proof their approach. Utilizing on-demand services for critical business support functions helps insurance professionals launch with minimal ramp-up time and improved ROI. On-demand services are inherently low touchpoint, coming with minimal upfront infrastructure costs and an easy pay-per-use model. This approach reduces demands on internal resources, freeing them to focus on high-value tasks that will grow the business.
On-demand catastrophe modeling enables an alternative view of risk for insurers and reinsurers
Recently the world has witnessed a surge in natural catastrophes, with increased (and increasingly severe) hurricanes, floods, wildfires, and windstorms. These events have destroyed lives and disrupted global economies, highlighting how the established catastrophe models and exposure analytics the insurance sector have relied on for years must adapt to the new landscape of catastrophic events.
As risk managers struggle to prepare for new and more severe perils, they must identify new and better ways to understand risks. There is no one-size-fits-all approach when it comes to catastrophe modeling – different models utilize distinct methodological approaches, diverse assumptions, data inputs and computational algorithms. Using a combination of advanced models gives re/insurers and brokers a better view of evolving risks by identifying new or hidden loss drivers.
On-demand cat modeling enables insurance organizations to adjust with the changing risk landscape. By working with a combination of advanced model providers, including Oasis LMF, and diverse third-party data sources, on-demand cat modeling services help organizations see a more accurate view of evolving risks without being tied to a proprietary system. It is also adaptable, allowing for seamless updates when new models or data sets become available. It can be executed quickly, and the on-demand nature means insurers only pay for the services they need, when they need it. Having multiple data sets as the foundation for decision making helps insurance organizations price key risks with greater confidence.
On-demand cat modeling services are available without any licensing requirements and allow CXOs to choose from a range of diverse disaster models. The transparency of the process and the modeling platforms allow end users to better understand the model assumptions and have greater trust in the model results.
Policy checking, COI management, document management and triage for agents and brokers
On-demand services for agents and brokers employ technology to manage and organize important administrative assignments, including certificate of insurance (COI) management, policy checking, and document management.
Typically, the performance of these essential, yet mundane, administrative tasks fall to insurance agents and brokers (or their staff) as they support their clients across the policy lifecycle. Given the detailed nature of these tasks they can frequently occupy a significant chunk of time and capacity, limiting opportunity and attention to high-value jobs focused on deepening relationships and growing revenue. These tasks are especially common, and important, during renewal periods, when work backlogs and human errors can be even more noticeable.
On-demand services can enable agents and brokers to avoid such mishaps while optimizing crucial business workflow models, expediting error-less data management, and aiding business development. Especially in the case of policy checking the elements of people, process, and solutions powered by technology all play vital roles in helping agents and brokers meet their customer expectations while reducing the risk of mistakes and E&O exposures.
On-demand services reduce work volume for claims professionals and lessen stress for policyholders
Policyholders expect their insurance carriers to be responsive and provide personalized support quickly and accurately, especially when something goes wrong and a claim is filed. Therefore, claims professionals must provide competent and client-centric support to help customers manage their claims efficiently and effectively.
Catastrophic events are stressful for everyone involved, and insurance organizations must rely on solid infrastructure for applications processing and support to reduce wait times and handle increases in volume seamlessly. On-demand claims services that provide digital-first solutions for bolstering insurers’ labor-intensive back-office and call center operations can accelerate catastrophe management and fast-track claim resolution. This enables insurers to enhance their services, speed claim settlements, manage appraisals, resolve inquiries, and ensure a positive customer experience.
Cost-effective print and distribution services
Documentation is a critical component of the insurance sector, but managing and maintaining volumes of documents requires time, patience, and a staff of professionals willing to handle often mundane tasks. Although print and documentation are crucial to the smooth functioning of business, resource management plays an even greater role. This is why on-demand services to automate printing and distribution serve an important and cost-effective role. These on-demand services ensure that high-quality printed documents are created and delivered on time, freeing up the CXO’s time to provide personalized customer services.
In the modern insurance industry finding a way to implement business agility is vital. Such an approach positions organizations and CXOs to adopt new technology and business approaches, providing an opportunity to innovate, personalize, and implement value-added services to renew existing clients and attract new ones. Leveraging on-demand services can help insurers become business agile and focus on product innovation, relationship building, and developing an improved customer experience.
Ratika Gupta is associate vice president, insurance business solutions for Xceedance.