 By Richard Clark, Head of Business Development at Xuber
Like it or not, automation has crept into our personal lives like smoke drifts under a closed door.
We fire up the sat nav from the warmth of our bed. We pretend we’re at home when we’re not. We feed our cats and fish automatically when we’re on the other side of the world. Hey, if it saves us money in house-sitters, and a few seconds of time each day, then high-five to automation.
But where will it stop? Would you automate a phone call to your best friend on their birthday with a recorded voice? Would you let an app choose which school your children go to? Surely not.
The insurance industry is awash with talk of automation, and COOs are being lured with promises of time-savings and improved business efficiencies. Yes, automation does have the power to achieve positive benefits in many ways, but how far can decisions actually be automated in commercial insurance? Can we automate the decision itself, or should we be automating the decision making process to improve the quality of our decisions?
Maybe it’s not the panacea we thought
From when a customer enquires about cover, through to when they submit a claim, not only do they now expect us to make decisions quickly, they assume that we have real-time visibility of who they are and what they want, no matter which department they are speaking to.
In a tough market with ever-changing regulations, and often complex layers of intermediaries, commercial insurers are clamoring to automate and reduce the steps in their business processes to satisfy such customers more quickly and cost effectively. But therein lays the rub. The very essence of the London insurance market is that it’s non-standard, and in our unique environment is it realistic to expect that many – if any – decisions can be automated to achieve this?
The answer lies in looking beyond efficiency savings, and asking yourself exactly where automation is going to add real value to your customers and your own people.
How far can decisions be automated in commercial insurance?
Personal insurers have the luxury of customers and products that create near carbon-copy processes and transactions, and any activity that is repeatable in volume can be automated. Auto-underwriting is an example - personal insurers isolate actions that abide by a set of rules and apply tightly defined decision paths and algorithms to automate their underwriting decisions.
Unfortunately, this kind of replication just isn’t possible in the complex commercial field because the London market deals with multiple stakeholders, which, more often than not, have unique and specific requirements. Pricing risk that doesn’t have a statistical base is simply impossible to automate.
The price of over-efficiency
Albeit essential to our success, the London market is built around people and not computers or software. People buy from people, and it’s these personal relationships that hold the greatest value which you can’t squander. Complex customers require complex policies, and that requires personal engagement – fact.
So before diving headlong into automating everything, consider the impact of failing to offer your customers enough choice. They are unique, and really deserve to be treated as such, and insurers that remember that will be regarded highly. Take time to fully understand your customer journey and put yourself firmly in their shoes when you do. The last thing you want – in your efforts to be more efficient – is to end up with frustrated and annoyed customers just because you aren’t as flexible as you used to be. You’ll also run the risk of missing opportunities that only the good old art of conversation can uncover.
Analytics gets savvy
Gone are the days that only management and analysts could access and analyse data to improve decision making. Tools that put the power of real-time business intelligence in the hands of anyone you desire within your organisation are now a reality.
Analytics, suffice to say, when deployed with your customer still firmly in mind, can give your people an immediate snapshot of exactly what is happening, enabling them to analyse business information whilst on the go and make better informed and timely decisions.
Like trying to build a house on quicksand - even the best tools in the world will fall short of the mark if the foundation of data they are asked to work with not correct or consistent. Data plays a pivotal role in any kind of automation or analytics, and workflow and process management time are only going to be enhanced when built around accurate and consistent data.
Analytics represents a useful level of automation that serves commercial insurers well in trend tracking and improving service through greater customer insight. Remember though, whilst analytics will provide your people with enhanced and more consumable feeds of information to help aid the decision making process, it won’t miraculously replace decision making itself. So don’t expect it to.
Shiny, happy, people
Don’t get me wrong, automation on the commercial side of the fence certainly has a valuable role to play when applied to tasks such as inter-department collaboration, case management and claims handling, but don’t ever lose sight of your customer just for the sake of performance.
You still need to put your best people firmly at the front-of-house to finesse your customer service with the personal touch. And, in an age of faceless companies in our personal lives, that surely isn’t such a bad thing.
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