Insurance Digital Transformation: 7 Reasons It Fails

digital transformation for the insurance industry

In the United States alone, the insurance industry writes more than $1 trillion in a single calendar year. This industry is booming because it’s a universal need.

If you provide insurance to customers, you need to stay ahead of the curve with the way that technology is evolving. Going digital to the fullest extent should be your course of action.

However, knowing and doing are two different things. Several professionals in the insurance business make mistakes when trying to go digital.

So, what mistakes should you look out for on your journey?

When you’re looking to make the insurance digital transformation, consider the points below.

1. Insurers Don’t Automate Enough or as Effectively

Today, small business automation is improving companies more than almost any other technology. Automation and digital transformation let you do more with less, cut costs, and make your insurance business more profitable.

Most companies don’t have their digital goals laid out. As a result, their automation is haphazard or ineffective.

Many companies look into document automation so that they can streamline their workflow. Other forms of automation include e-mail automation, product sales, and policy issuance.

Many companies also incorporate automated user provisioning and file transfers.

You’re leaving a lot on the table when you fail to automate the tasks that your insurance company handles regularly.

Automation lets you fill jobs around the clock that would otherwise require you to hire a team of professionals.

2. Customer Service Doesn’t Get Upgraded

Without question, the digital upgrade should benefit the customer more than anyone else. If you’re going digital but your customers are being shortchanged, you can never call it a successful transformation.

You can upgrade your customer service by using chatbots to help your customers. Chatbots are digital tools that are becoming more popular, especially in the insurance sector, because of their convenience and usefulness.

Customers can have questions answered about their claims and won’t have to sit on the phone for several minutes waiting for an agent.

Your agents can still tackle problems that are too big or specialized for artificial intelligence (AI) and will be more energized and available since they won’t have to address every single call.

Discover 15 Tips for Better Customer Service Communication

3. Place Real Value Over Arbitrary Tech Upgrades

The first thing most insurers do is geek out over technology. They start breaking out the algorithms, designing apps, and considering things like code and processes.

These matters have their place, but always put providing value over your customers above all. All of the tech upgrades in the world don’t mean anything if you don’t have any substance behind it.

Know who you are as an insurance company and what you do best, and use digital technology as a tool to make it happen.

4. The Experience Level Wasn’t High Enough

It can’t be overstated how important it is to have professionals on board who can help your insurance company through the digital transformation.

Without them, you run the risk of painting yourself in a corner with misguided goals.

Professionals can also assist you with risk management and will forecast the situation to let you know exactly what you’re dealing with. The last thing you’d want is to lose business because you didn’t take these matters into account when you set out on your transformation mission.

5. Companies Never Commit Upfront

Commitment seems like such a small matter, but it’s one that insurance companies gloss over.

Without an honest commitment, your digital transformation plans will always be half-baked. Change brings about resistance no matter what, but there’s more resistance when everyone isn’t on board.

This transformation starts at the top, so make sure that your leader believes in it more than anyone else. When your leaders see the vision, they can pass the message down with the right information and an understanding of what the future looks like.

There are obstacles you’ll have to deal with no matter what, so cultivating a belief in the process will carry you through these tough times.

6. The Company Internally Wasn’t Ready for Change

You must have every department moving in the right direction. When there is resistance among the ranks, it will bring the process to a screeching halt.

Many companies making this upgrade find themselves dealing with inexplicable problems that hold things up.

Resistance often shows up in the form of small mistakes, which is inadmissible in the insurance industry.

These small mistakes will multiply and have you spinning in circles. Embrace change and you’re more likely to follow the proper steps and avoid resistance.

7. Too Much, Too Soon

Digital transformation doesn’t mean that you need to overhaul your entire system all at once. Start with your most pressing needs and scale it up little by little.

So many insurance providers also get tunnel vision with their project and never study the competition. If you study your competitors, you will see that they likely didn’t do everything all at once.

Instead, they started small, corrected their mistakes, and then progressively moved forward with their digital changes.

Discover the Digital Transformation Myths for 2020

Undergo an Insurance Digital Transformation

Making the insurance digital transformation will take your company to the next level. Regardless of what kind of insurance you sell or to which demographics, going digital is the wave of the future.

We’ve been around for years and help companies like yours make this a reality. Whether you need one-on-one help with creating a digital experience or want to build your developer toolkit, we’d be glad to assist you.

Reach out to us to get to know the customer experience and the tools we can offer.

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