How insurance firms can come out of the pandemic stronger

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Wednesday 04 August 2021 09:58
How insurance firms can come out of the pandemic stronger

James Harrison, Head of Insurance UK & Ireland, Dun & Bradstreet

Insurance, like almost every industry, has suffered from the disruption caused by Covid-19. But for all the irreversible changes to our lives and livelihoods, there have also been invaluable lessons learned – and insurers have an opportunity to emerge stronger from the pandemic than they were before it.

By investing in and embracing the right technologies – and successfully implementing them in firms – insurers can enhance operational efficiencies and re-establish their value proposition. And leveraging the capabilities of digital and data insurers can also lead to a better understanding of the needs and desires of customers.

Continued digital transformation of the insurance industry

Covid-19 quickly made it apparent that firms that had embraced digital technologies were better placed to navigate the pandemic’s prolonged challenges. But the onus is now on the whole industry to invest in digital technology, enhance operational efficiency and move forward as one.

For insurers, digital can remove significant cost and reduce time-consuming manual work. Increased focus on the suitability of smart contracts can also offer significant benefits to policyholders by streamlining the overall claims process, cutting down on delays and reducing uncertainty in the event of a loss.

By embracing emerging technologies such as blockchain, firms can also reduce unnecessary paperwork. Automation and artificial intelligence (AI) will also play a pivotal role in the development of smart contracts to prevent fraud, as well as freeing up staff to focus on more fulfilling and business-critical tasks.

Insurance firms to take on a more advisory role

There’s an opportunity now for insurers to demonstrate their added value to customers. One such way is by taking on an educational, advisory role, whereby if a claim doesn’t occur in a policy lifecycle, customers can still expect to feel that they’ll get what they paid for.

Cyber-security insurance is one area where this is already happening, with firms advising clients on preventative measures to avoid a breach in the first instance and then, where needed, responding to individual incidents. Ultimately, it’s about being proactive rather than reactive and informing behavioural change in an organisation to help prevent loss of products.

Operating in this way means firms can build better relationships with customers and meet their evolving needs. Advising customers also supports loss prevention rather than loss indemnity, which is beneficial because not only does it give customers more control to reduce premiums, crucially, it also helps to improve claim ratios and insurer profits.

Data must be used in a more structured way

Data is central to the running of any successful insurance firm, from helping to better understand customers, to risk assessment and analysing the full extent of a claim. If insurers hope to improve their value proposition to attract new customers (and retain old ones), leveraging insights from enhanced data analytics will be the key to becoming more customer-centric.

To achieve this, however, first-party data alone is no longer enough. Insurers, like banks, have valuable information on their customers, but most of it is their own internal data – and that’s just half of the picture. In response, insurers should be looking to combine this with external data sources to develop a complete view of customers.

Once you have this high-resolution view of consumers, it can breed operational efficiencies across the value chain, from onboarding quicker and enriching experiences with fewer questions for customers to answer, to understanding their wants and needs and knowing exactly what innovative products and services are required to meet them.

Become more data-driven and customer-centric with D&B

The insurance sector today has a unique opportunity to leverage the capabilities of digital and data, to drive innovation and become more customer-centric.

Get in touch today to learn more about how D&B’s world-leading business decisioning data and insights can help you to proactively meet customer demands, seize the digital opportunity and emerge stronger from the pandemic.

Originally published on Business Reporter

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