Opinion: Insurers Can Build the Human Touch Into Automated Systems

Russ Hubbard, Chief Revenue Officer at Ephesoft looks at the impact of automation and AI within insurance and sees great potential in the time-saving element. In short, insurers and brokers can spend more time sorting out complex claims, or reaching out to consumers in other ways.

In the world of insurance, ads always seem to display great customer experience in the moment. They centre on the happy family living a comfortable, protected picket-fence life. “Look how we’ve understood the needs of this family,” these ads say. “We can understand you too!”

With these messages, insurance companies are hoping to foster feelings of loyalty among their customers by appealing to their emotions. This approach is prevalent throughout the world and corresponds to the thinking outlined in an article in the Harvard Business Review, which states that ‘on a lifetime value basis, emotionally connected customers are more than twice as valuable as highly satisfied customers’.

recent Bain & Company report has confirmed that loyalty can be the most lucrative commodity in the industry. The research found that loyal customers buy 25 per cent more insurance, consolidate almost 90 per cent of their insurance with one provider, and refer 250 per cent more clients. Based on these findings, it is not surprising that delivering good customer experience has taken a higher priority for many companies. Not to mention that one small error can cost you dearly in the public courtroom of social media, where publicity of bad customer service often spreads like wildfire.

Closing the customer experience gap

There has always been a difference in perception between companies and their customers when it comes to levels of satisfaction. Companies frequently overstate the quality of their service, and customers are quick to shatter any illusions. A separate Bain survey exposed this discrepancy. When 362 firms were asked whether they believe they deliver “superior experience” to their customers, 80 per cent said they did. Just 8 per cent of their customers agreed.

What is the disconnect? Of course, consumers have rarely taken a company’s own assessment of their customer experience particularly seriously, because they often haven’t experienced the connection themselves. In a world that is becoming increasingly tech and data driven, it’s easy to think that it is harder than ever to create authentic connections with your customers. This is, however, simply not true.

The automation paradox

It seems counter-intuitive, but rapid developments in automation technology are enhancing the ability to develop strong emotional connections between insurance companies and their customers.

Technology is achieving this in two ways. Most importantly, the automation of business processes is improving the sheer speed of service. Consumers and businesses – not just millennials – want products and services quickly; and few places more so than in the insurance sector.

Take the infamously painful claims process, for example. A claims processing department deals with huge volumes of data, frequently involving a combination of physical paper and electronic documents, such as emails or images, that are not in a structured format. Assessing them traditionally involves manual intervention from a team of people – no wonder it takes so long. Now, however, intelligent software can automatically capture all the data from claims files, recognise its differing types of forms, and then categorise and export the data to other systems. By removing the agonising wait to hear whether you’ll get a payout when your house has burned down, the insurance company also removes the stress and resentment that can destroy a decade of loyalty.

A recent study of our own customer base revealed that automation processes have decreased document preparation efforts in insurance firms by 50 per cent and indexing by 75 per cent.

Additionally, the automation of so many administrative tasks frees up employees to apply themselves to the more obvious aspects of customer service, addressing customers’ more pressing concerns and taking the time to solve their problems.

The most profitable customers you could ever have aren’t wanting to see a picture of someone a bit like them playing with a dog. They want a company that delivers what it says it will, reliably and quickly. The ability to achieve this lies in the power of automation, which enables the conditions for emotional connections and forms the framework of customer loyalty. And soon enough – when firms begin to fully understand and implement these technologies – we’ll see the customer experience gap between company and client finally start to close.

About InsuranceEdgeEditor (1730 Articles)
20 years experience as a journalist and magazine editor. I'm your contact for press releases, events, news and commercial opportunities at Insurance-Edge.Net

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