The Insurers, brokers, and agencies are experiencing double whammy. They face the mammoth task of generating returns when the premiums are falling and claims are rising. The industry is witnessing newer engagement models driven by technology innovation. Fintech and underwriters are using technologies to reach out directly to clients, threatening revenue growth and sustainability. Increasing business compliance requirements and tougher regulations are hurting the margins. On an average, most intermediaries are shelling out close to about 10% of their revenue in E&O exposure and other penalties for non-compliance. Insurers realize they need to pursue a multi-pronged strategy involving focus on higher premium customers, reaching new customers, strict selling policies, robust onboarding and easy renewals to stay competitive.
To make a successful transition to a self-sustainable, affordable and profitable business, insurance agencies need to:
- Efficiently manage their cost structure.
- Develop systems and process that ensure consistent response and quality of service delivery.
- Streamline operations to reduce waste.
- Build cost-effective business continuity mechanisms.
- A delivery that can scale quickly against demand and meet customer segments requirement.
Unfortunately, insurance practices are rooted in traditional manual practices simply are not set up to move at high velocity. Many insurance activities are repetitive and prone to manual errors. Industry insiders realize renewals happen 365 days and seven days a week and most risk managers and brokers consider 30 or 60 days before renewal, termed crunch time in the industry to be critical. However missing information, poor communication, errors cause delays in renewals or rushed quote that does not provide the best results.
Insurers are aware 70% of the policies, especially small to mid-sized business accounts and BPO policies are automatically renewed each year. Insurance companies realize customers do not renew if the service is poor or payment process is cumbersome. However, annual renewal processes involve a high possibility of manual error and long wait times for customers.Slippages and renege are common. Many a time lower cost, high volume policies are missed or delayed due to manual intervention leading to lapsed coverage or customer abrasion. Initial data entry process, data integrity, and non-standard process also contribute to high TAT.
Renewals bring better margins and sustainability to the insurers. Today customers expect an omnichannel hassle-free self-managed renewal process. For many brokers, First time right (FTR) rates even for low-premium hovers around 60%, and large-scale transaction volumes witness a high rework and additional administrative costs. Automating renewal process would not only remove human burden and boredom but also drive higher productivity. Automation can also serve as another delivery channel to engage low-value low-risk policies. This would enable brokers and underwriters spend more time on higher risk and more profitable business. Automation of renewal process involving both on-demand renewals with no touch or minimum touch reduces costs and results in improved productivity. Controlling TAT has a major influence on administrative cost savings, which is key driver for transforming the broker business
Exdion Policy Checking on Demand (Exdion.PoD)
Exdion has developed an Artificial intelligence (AI) led solution to offer seamless automatic renewal policy review. Exdion Policy Checking on Demand (Exdion.PoD) involves Robotic process automation (RPA), analytics and cognitive computing to transform “manual led” renewal process to an error free intelligent process. Exdion has developed eBOTS which are software programs that automatically match the current term policy against the prior term. eBOT driven automatic approval enables code-driven continuous delivery of policy renewa eliminating the need for a dedicated FTE to manage the same.
Exdion.PoD offers insurers the flexibility to customize their automated policy renewal process and issuance to accomplish a complete end to end business-specific policy renewal. Exdion.PoD enables insurers to configure custom business process for renewal, including the capability to configure selection criteria for policy for renewal, one-time or multi-year recurring execution with comprehensive auditing and error-free capabilities.
Benefits of implementing an Exdion.PoD:
Deployment of Exdion.PoD brings three major benefits to insurers: lower costs, happy customers, and higher growth. Firstly, automatic checking gives you significant cost advantage. It costs much less compared to Full time employee (FTE) cost. Second, human errors which can range between 5 to 7% get completely eliminated. Your employee would be able to spend time on high-value high impact activities. Employee satisfaction increases and employee attrition nosedives. Importantly, you would be able to scale up your business as a flood of policies come your way without investing in resources, their training and associated costs. It is a highly scalable and a cost-effective solution – 100% of your renewal process can be rule-based and automated. Exdion.PoD can work across all agency platforms, legacy systems and custom applications.[/kc_column_text][/kc_column][/kc_row]