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What does investing in digital mean for the insurance industry?



This post is part of a series sponsored by AgentSync.

The insurance industry is notoriously behind in terms of digital record.

But research suggests that nearly nine out of ten insurance executives (87) after covid-19 pandemic percent) plans to invest in digital improvements. Nine out of ten . It's an almost unanimous agreement from an industry known for counterterrorism – remember that each state (and territory) has its own set of regulatory rules and requirements.

This refreshing turn to unity should not come as a surprise after 2020 The stay-at-home mandate forced people to come to terms with the reality of working from home and made companies creative when it came to avoiding business disruptions. One constant for almost every person and business was the reliance on digital technology to maintain every semblance of normality.

Digital improvements are equal to more than online shopping

The digital improvements desperately needed by the insurance industry differ slightly from those in other industries.

A key example of this is the distribution channel directly to the consumer. Many industries have gone all-in on online shopping. No surprise there. By 2021

, more than 2.14 billion people are expected to buy goods and services online.

It therefore seems logical that companies should invest in a digital framework to encourage consumers to buy insurance directly from their websites. And some are.

Amazon announced its digital insurance network, Amazon Insurance Accelerator, which helps small businesses selling products on Amazon secure product liability protection. By relying on digital distribution channels, Amazon Insurance Accelerator seeks to make it easier for small businesses to compare insurances and quotes between insurers, thus landing on the insurance that is best suited to meet their needs.

While some companies pave the way for one directly to the consumer's future for insurance, many believe that the ease of buying at the touch of a button does not really translate into most insurance products.

Although 87 percent of insurance executives say they plan to invest in digital technology, only 32 percent believe that Investing in digital distribution channels is an effective sales strategy. This is because consumers like to work with people when making insurance-related decisions.

Producers are No. 1

Producers are the key to the insurance distribution network, largely due to the large amount of insurance available to consumers and the complexity of these policies. This makes it difficult to navigate the insurance industry as an insurance professional, let alone a consumer. such as annuities and commercial products. So the role of the producer in the insurance distribution network really goes nowhere.

However, this does not mean that there is no place for digital improvements in the insurance industry. In fact, consumers tend to look for multiple points of contact when contacting insurers throughout the customer's life cycle. Whether via chatbots, websites or call centers, consumers want access to their insurer around the clock and the flexibility to choose their preferred method of communication.

Transforming the customer experience

Consumers need insurance – and communicate with their insurers. – in the face of accidents, natural disasters and new risks. The coronavirus pandemic, for example, led to a 30 percent increase in insurance-related consumer demand. And yet, nearly 40 percent of insurers say covid-19 affected customer base.

How come?

Until the pandemic made it literally impossible, the insurance industry relied heavily on personal meetings and communication. Slowly embracing the sweeping digital changes that are revolutionizing other industries, many in the insurance world just kept going. But when closures forced people to need remote access to their insurance companies, those who invested in digital opportunities – including technology and tech-savvy staff – were the ones consumers turned to.

A June 2020 survey found that 41 percent of policyholders considering changing supplier notices poor digital capacity as the reason for the change. Digital technology is no longer optional when it comes to customer engagement and insurance companies are taking the step and noticing it.

With the help of innovations such as automation, artificial intelligence and virtual document signing, insurance companies are now taking steps to renew the customer experience. While previous digital improvements largely focused on digitizing manual processes – important in themselves – new technologies open up opportunities to reshape the consumer experience and create a customer-first approach to engagement.

Increase industry efficiency

Digital improvements also have the potential to drive efficiencies and streamline processes and workflows. At present, the insurance industry is full of manual processes that consume the time of manufacturers, which becomes expensive for insurance companies. An analysis of car insurance companies found that those who fail to invest in digital enhancements to increase efficiency should expect an annual profit reduction of between 0.5 and 1 percent.

Think of a company that invests in technology to save time for producers and let them focus on consumers. Manufacturers can not only sell more products, but they can also focus on promoting relationships with existing customers and thus reduce customer loss. The consequence of pursuing internal efficiency is an improved customer experience.

A look to the future

It is clear that the status quo is no longer good enough for insurance consumers. With more companies investing in technology that allows them to go beyond that for their customers, the bar has finally been raised.

This is good for the insurance industry. We now have the tools to go further, think harder and revolutionize the insurance industry for a technical future.

Check out a demo to learn more about how AgentSync revolutionizes the insurance licensing process for insurance companies.

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