Optimising insurance business process management
The insurance businesses have to deal with piles of customer forms, claims applications, KYCs, and compliances, most of which are still hard copies. Even though insurance companies understand the need to digitise their processes, strict industry regulations and legacy systems hold them back.
A leading general management publication says that insurance companies can use a well-designed digitisation program to achieve up to 65% cost and 90% turnout reduction.
Despite the roadblocks, the insurance industry is rapidly adopting business process management (BPM) into its operations. The market, which was at $3.38 bn in 2020, is set to grow at a CAGR of 6.25% to reach $4.78 bn by 2026.
This article will explore the benefits of having business process management in the insurance industry for better efficiency and claims experience.
Current challenges in the insurance industry
The insurance sector faces fundamental challenges in its structure, be it the sales network, commissions system, agent management, and lack of productivity. The top challenges facing the insurance industry are –
- Lack of a unified platform that can cross-sell or upsell different products.
- Customers from the same household could end up providing the same information multiple times.
- Unstructured communication and work processes for agents, claim adjusters, and call centre executives.
- Administrative overhead and lower customer satisfaction and productivity.
- Lack of transparent customer intimation system at every level of new policy or claim application.
Through BPM, the insurance industry can bring standardisation, speed, accuracy, and consistency to process workflows.
Why should you introduce BPM in the insurance industry?
Factors that drive the success of the insurance business are competitive products, customised service, efficient marketing campaigns, significant market reach, and an effective agent network.
Structured business processes lead to the optimisation of complex data-driven operations. BPM in the insurance business increases customer satisfaction through faster response. You can reduce operating costs, improve the efficiency of your agents and systems, and have a better risk management process in place.
Benefits of BPM in the insurance industry
The insurance industry has multiple customer touchpoints. Here is why you should consider introducing BPM in the insurance business –
- Manage workflows better through unique models for process scenarios.
- Introduce transparency at every step for faster validation of processes.
- Automate data transfer into systems to reduce the execution time.
- Optimise the processes and identify tasks that you can remove.
- Achieve greater financial savings, operational performance, and profitability.
- Automate repetitive tasks to boost efficiency.
- Provide better customer experience through customised products and services.
A simple example would be an efficient agent management system that tracks all commissions and issues the payments on time. Similarly, vet a new agent or institutional broker for its competency and authority before signing a contract.
What should you consider automating in insurance?
When you design an automation strategy, remember that even the most streamlined processes may need some human intervention. Processes, wherein you can bring BPM, are –
- Insurance claims processing.
- Sales and distribution.
- Forms filling and registration.
- Billing and collection.
- Regulatory compliances.
- Policy management.
- Complaints and appeals.
- Automatic insurance offers through emails or on the website.
BPM applications in insurance
BPM makes your internal and external processes agile, streamlined, and flexible. Some of the practical applications are –
BPM for front office
- Carrier management
- Introduce several insurance policies to prospective customers.
- Monitor the different distribution channels.
- Manage and update agent commissions.
- Multi-distribution channel management
- Utilise and blend present channels with new ones.
- Rapidly renew rules for new channels.
- Consistent flow of data between channels.
- Better workflow management
- Automatic intimation of policy renewals.
- Business intelligence for automatic quote generation.
BPM for underwriting
- Lower operating expense
- Straight-through processing and rule-driven implementation.
- Regulation to compliances.
- Better customer experience.
- Custom and automated underwriting systems.
- Higher-income through premiums
- Ability to issue policies for a better agent and customer experience.
BPM for claims settlement
- Route claims automatically to adjustors.
- Automated work assignment.
- Risk management
- Predictive analysis for better fraud management.
- Smooth flow of information across departments.
- Third-party management
- Integrate real-time data with vendor and regulatory authority systems.
- Customer acquisition and retention
- Flexible payment of claims and equitable settlements.
- Effective decision-making for underwriters.
- Competitive pricing models.
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How can Infosys BPM help?
Infosys BPM has helped over 45 insurers significantly reduce their OPEX and exceed market demands and customer expectations. From property insurance to life insurance, Infosys BPM holds expertise in 33+ LOBs.
Read more about the business process management for insurance at Infosys BPM.