msg life ag - Logo
Underwriting processes

Optimize underwriting and customer experience

by msg life / 31. October 2021

Consumers have become accustomed to self-service. We go to the gas station and refuel ourselves. Later, we go to the supermarket and not only fill our cart but we even pay for the purchase in self-checkout boxes. And if we have time to spare, perhaps we will go to a famous furniture chain, where we will buy a closet that we will pick up directly from the warehouse and then assemble at home with our own hands.

Self-service society

The do-it-yourself concept has been installed in all planes of our life, even in financial services. More and more procedures are being carried out from the entities’ websites or through mobile apps. In addition, the consumer perceives as an added value that his bank offers him the possibility of solving these questions himself. As long as you also have the option of solving it in another way, if you prefer or a problem arises.
Even for a matter as delicate as investment, more and more users rely on robo-advisors, who make use of artificial intelligence to offer the products that best suit their risk profile.

Digitization and automation are the keys

The customer of the gas station, the supermarket, the furniture store or the bank is the same as that of the insurance company or the brokerage. And if you rely on self-service for all these things, why not for insurance?
Entities are aware of this trend and are investing in its digitization. According to IDC and Liferay¹, 55% of insurers already have or plan to develop an online portal dedicated to their clients. Additionally, 45% of Western European entities are using or testing conversational voice technologies for customer service or interaction applications. And 66% of insurers use or plan to deploy communication with personalized information for their consumers.
Likewise, a study by Capgemini and Efma² details that 89% of Spanish insurers – compared to 82% of the total sample – have a website or application and invest in its improvement. In addition, the managers of the entities especially value the 24/7 availability of digital channels, as well as the ease of updating the information and the search capabilities they offer. However, only 32% of those surveyed —37% in Spain— consider that digital channels are effective in sales.
The key to turning this situation around is underwriting optimization, taking advantage of the opportunities that technology provides for automation. Only 28% of the insurers consulted by Capgemini and Efma have robo-advisors that allow them to make personalized product recommendations. In addition, less than 40% of entities believe that their digital channel is robust enough for customers to change channels without problems during the purchase process. And only 41% of agents and brokers consider the automated data capture and pre-filling tools they use to be efficient and consumer-friendly.
Along with the integration of self-service tools, the automation of the sector goes through the predictive analysis of data from multiple sources and the application of artificial intelligence, essential technologies to know the preferences of the clients, answer their questions and offer the most appropriate product. Not only do they allow you to better assess risks, but they also speed up the underwriting process, help optimize costs and simplify the purchasing process.
In addition, automation reduces the time spent on tasks with little added value, allowing this time to be allocated to personalized customer service, thus supporting the role of agents and brokers as trusted advisers. And this results in a better customer experience, an area in which there is a lot of room for improvement.
According to Accenture³, only 15% of consumers are satisfied with the digital experience offered by their insurer. The consultancy advises that an attractive design of portals and applications works very well to attract clients, but it is useless if the underwriting process is invasive, slow and arduous. In addition, it believes that technology will make us stop talking about “mass markets” to address a “mass customization” market, where insurers must be able to predict customer needs before he realizes that he has them.

References:
(1) ‘How to Accelerate Consumer Experience Transformation in Insurance’. IDC y Liferay.
(2) ‘World Insurance Report 2021’. Capgemini y Efma.
(3) ‘Automated underwriting. Breaking the rules to spark an underwriting revolution’. Accenture.

Article in collaboration with Inese (WILMINGTON INESE S.L.U.). In collaboration:

Blog Overview