Four ways independent insurers can improve technology

CEO and Co-Founder at COVU.

Even in our self-service world, many consumers still prefer face-to-face interactions with the people who help them manage risk, including health care providers, financial advisors and insurance agents.

In the insurance space, major carriers have made significant strides in technology, offering apps for consumers to file claims and creating online portals to manage policies. However, independent dealers are often slow to develop tools that help consumers or better manage their own operations.

Often, as these independent agencies grow, administrative tasks begin to become more complex and begin to pile up. Owners and agents may find themselves spending too much time managing back-office tasks and not enough time proactively with customers. In fact, McKinsey reported that companies are struggling to manage back-office workloads, which has led to a drop in customer satisfaction and financial performance.

Automating common dealership tasks can streamline day-to-day operations, giving reps more time to focus on serving customers, cross-selling and helping customers more effectively mitigate risk. Using the right technology can speed up service delivery and save significant man-hours every year.

The successful implementation of automation technology and artificial intelligence (AI) tools in insurance business operations can have an impact on quality and efficiency, helping agents build stronger, more personal relationships with customers. But it is difficult to know where and how to apply these tools.

For insurance organizations considering modernizing their business practices, here are four areas where technology can benefit both the business and its customers.

1. Accurate data collection

Data is at the forefront of how organizations learn, grow and develop customer relationships. Companies generate the most leads from their website, but it’s not always easy to get those leads to provide the necessary information up front. Incomplete applications mean staff can spend hours tracking down potential clients, gathering missing information and recommending suitable coverage options. By modernizing the data collection process, agencies can refocus on what matters most—the consumer.

Solutions such as implementing a reliable online customer relationship management system, sales database or lead funnel can reduce manual inputs and reduce human error, resulting in a clearer picture of the customer’s needs at the beginning of the relationship.

Gartner research found that “organizations believe that poor data quality is responsible for an average of $15 million in annual losses.” This inability to manage data has negative consequences leading to low-quality or unsatisfactory customer experiences. It can cause agents to recommend the wrong policy or miss important opportunities to increase sales. With better management of data collection, services control what parameters they measure, who manages it and how to use it, all without the worry of human error.

2. Personalized Marketing Communications

Effective personalized communication with customers and prospects can strengthen customer relationships and increase team productivity. Instead of relying on agents to manually send information about new services to all customers, send reminders, or schedule meetings, marketing automation technology can help categorize customers, automatically send outbound marketing emails, and alert agents for tasks they need to complete. Better data collection can also work with marketing to ensure agents are always communicating with customers to build stronger relationships.

To effectively use personalized communication to attract customers or sell new services, agents must understand customer needs, have access to the right tools and platforms to manage outbound email campaigns, and have the resources to an effective follow-up.

3. Cross-selling to reduce customer risk

With millions of dollars in policies under management, it’s difficult for agents to know which customers may lack significant coverage or who may be ready to update their policies due to changes they’ve made in their personal lives. However, today’s variety of AI tools can help automatically review customer data and policies and proactively flag customers who may present an opportunity.

For example, an insured who recently purchased and insured lakefront property may also be in the market for boat insurance. Or customers living in a hurricane-prone area may need to consider flood insurance as climate changes and new areas face natural disasters.

Automation and artificial intelligence can take the burden off agents to seize every possible opportunity. It can be used to automatically find sales opportunities, identify underutilized policies that could benefit the customer, or even proactively share new service information with policyholders to fill gaps in their risk profile.

When agents don’t have to dig through extensive data, they have more time to work one-on-one with customers to explain new personalized insurance products and demonstrate their value by reducing customer risk. This heightened approach to customer service creates more loyal and protected customers. Before implementing automation or AI tools, make sure you have your customer data organized and talk to industry peers to see what tools they’re using.

4. Improved fraud detection

Artificial intelligence and machine learning-based tools can also help insurers spot unusual patterns in data. For example, by comparing new claims with existing customer data, the software can help automatically detect claims that appear to be unusually high and potentially fraudulent. Using this technology, companies can spot unusual data patterns that the human eye might miss and reduce the likelihood of fraudulent claims that can affect a company’s reputation and revenue.

Modernizing your independent insurance agency doesn’t have to be complicated. There are now many cloud-based tools that are easy to install and learn. Companies that automate back-office processes typically see overall growth productivity and profitability—unveiling easier ways to streamline claims processing, rapidly digitize documents, manage faster underwriting, and free up time to create more personalized relationships with policyholders that can reduce risk—both for the company and and for customers.


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