Last month, the Insurance Times published an article: ‘More UK claims handlers ‘increasingly frustrated’ by delays and communication,’ exploring the disparity between stated turnaround times and the struggles claim handlers face reviewing claims documents promptly. Excessive insurance paperwork creates a frustrating bottleneck for claims handlers and customers, leading to delays in resolving claims.
Around a year earlier, the Insurance Times addressed manager burnout in the article ‘Insurance managers trying to do more with less as workloads rise’. Undoubtedly, there is a correlation between handling excessive paperwork, an increased workload and, ultimately, manager burnout.
The insurance industry already struggles with value chain inefficiencies, from claims processing to policy changes (and more). An Insurance Times study substantiates the industry’s reputation, reporting that insurance workers waste 2.5 hours daily – more than other industries like education and the public sector. Shackled by mountains of administrative tasks, insurance managers, for instance, struggle to make key decisions that would enhance customer experience (e.g., improving self-service portals or developing and implementing an omnichannel communication strategy).
The result? Stressed out employees. Tons of paperwork. Hours down the drain.
The solution to this problem is not to adopt a technological gimmick that promises end-to-end functionality. Case in point – buying an automated underwriting system will not eliminate the time employees waste daily. Rather, it will transfer that time to learning and managing the new system while the time-wasting operational procedures persist.
When working with our clients in financial services, we’ve found the best strategy for saving time is to take a specific and considered approach to automation. An ideal starting point involves identifying which repetitive processes can be automated and proceeding from there.
Several immediate contenders for automation exist – marketing, website chatbots and even decision-making. This article focuses on one in particular – the insurance document lifecycle. From initial engagement and underwriting to renewal or cancellation, let’s examine which repetitive document-intensive processes you can automate with insurance technology (insurtech).
An insurance document automation project can be lengthy and complex yet ultimately rewarding. Let’s break down this process into three distinct stages.
The insurance document automation market is highly competitive. Selecting the right solution involves prioritising factors like speed, accuracy, usability and other relevant features. Requesting a Proof of Concept (PoC) can be highly beneficial when deciding among multiple strong contenders.
Instead of diving into the deep end with a contract, consider a time-limited PoC. A PoC will validate the automation project's feasibility, ensuring smooth integration, efficient workflows and usability.
Once implemented, automation technology is not a ‘sit back and forget about it’ investment. To reap the benefits of document automation continually, insurers and vendors must work closely to improve the technology’s performance. For instance, vendors may add extra features at the insurer’s request and improve the technology’s speed and accuracy.
Third-party automation tools can be more effective and cost-friendly than internally developed solutions. Here’s why – building a document system from scratch tends to be a black hole for time and resources. Yet insecure APIs, outdated protocols or vulnerabilities in automation tools can provide hackers with a backdoor into the insurance company's network – including sensitive customer data. The best way to mitigate cybersecurity risks is to choose a provider with robust security protocols, as evidenced by relevant certifications, such as ISO 27001.
The ABI estimates that £1.1 billion of insurance fraud goes undetected annually. Automation technology should actively combat fraud rather than usher in new opportunities for it to occur. For instance, if an automated data extraction tool has poor data validation mechanisms, it will make it much easier for fraudsters to submit synthetic data for better coverage or claims.
Managing the relationship between employees and automation technology will likely require a short- and long-term commitment. Over the last few years, the insurance industry has experienced massive staff shortages, and employees might worry that their employers will resort to automation technologies and, subsequently, eliminate the need for human labour. Employees may even become anxious or hostile when confronted with intelligent automation technologies.
However, successfully operating automation technology calls for more than a welcoming attitude – it requires expertise. Combined with the insurance industry’s staff shortage, it might seem challenging from a talent perspective. In particular, the skills needed to work alongside these technologies include process improvement, data literacy and understanding the fundamentals of automation technology (e.g. user interfaces, configuration options and basic functionalities).
Though hiring new talent is an option, instilling these skills in existing employees may seem daunting to managers. Yet, it’s a necessary investment when future-proofing a company. Moreover, fostering a culture of innovation and improvement may seem challenging in a time-pressed, understaffed environment. But if staff understand that insurance document automation technology can improve their working lives, it will be easier to get them on board.
Automating insurance document management processes can conserve time in a notoriously time-poor industry. As insurtech gathers traction, it’s best to take a component-based approach, where companies deploy technology to automate individual processes rather than wholly replacing employees.
Evolution AI offers multi-award-winning automated data extraction from insurance documents. Book a demo to discuss your business’s use case with our financial data team today.
