The big theme for February is automated systems and how they are streamlining and enhancing the insurance industry. This insights piece is by Louisa Pavis, Pro Global Head of Digital Services, and it looks at the rise of AI nad automation across the insurance sector. So much admin can be automated now and it’s arguably in the two sectors of pricing and claims where the big wins are.
“The revolution will not be televised” – that famous phrase coined by the poet and musician Gil Scott-Heron – is a powerful statement of fact: significant societal change won’t be captured or conveyed adequately through headlines (and yes, that irony is not lost on me). Instead, it implies that real change happens on the ground, among people, away from the public gaze. In the context of technology’s impact on society, this phrase is never far from my mind.
Robotic process automation (RPA) may not be in the headlines on a daily basis like its altogether buzzwordier cousin Artificial Intelligence, but its impact on society and industry – specifically our global re/insurance sector – is growing steadily. That’s because it’s not about flashy robots or sci-fi scenarios; rather, it’s the gradual integration of automation into various aspects of our jobs, and into the fabric of the systems we use to make decisions and shape strategies.
The automation revolution is subtle – driven by algorithms that operate invisibly in the digital realm. And to understand how this technology is transforming re/insurance today, we must look beyond the surface and pay attention to the deeper, often unseen forces shaping the fabric of the industry.
One of the key areas experiencing transformation is claims processing. Through new RPA algorithms, insurers can now expedite the evaluation and settlement of claims, reducing manual intervention and improving accuracy. This not only enhances customer satisfaction by providing quicker resolutions but also optimises operational costs for insurance companies by triaging the most complex claims for human attention.
Fraud detection is another critical aspect where RPA can play a pivotal role. By employing sophisticated models, insurers are analysing vast amounts of data to automate the identification of fraudulent patterns and anomalies, enabling proactive intervention and mitigation of risks. This not only safeguards the integrity of insurance systems but also protects legitimate policyholders from potential fraudulent activities.
Similarly, another current and evolving application is in auditing. By automating auditing processes, insurers can conduct comprehensive assessments with greater precision and efficiency, minimising the risk of non-compliance while optimising resource allocation.
However, as we progress into 2024, the most valuable current applications for insurers already lie in enhancing their own operational efficiency. Insurers are embracing process automation, often through expert third-party service providers, to streamline complex operations and adopt smarter workflows. Particularly, fronting carriers and programme management businesses are turning to digital tools and partnerships to overcome scalability challenges and drive business growth.
UK insurer iGO4, launched a transformational Robot Process Automation (RPA) programme with the Pro Digital Solutions team – creating 160+ bots in 12 months and automating 40% of its processes to deliver seven-figure cost savings. The approach enabled iGO4 to automate high-volume and small, infrequent tasks that would not otherwise have been financially viable, reducing regulatory risk. Employee job satisfaction is also increased by removing routine tasks and enabling the focus to switch to more complex and rewarding work.
Human expertise at the heart of the automation revolution
This is just one example of the real revolution taking place right now in insurance. As well as return on investment, and cost reductions, it is about how this technology frees up our industry’s experts to take action based on the deeper insights and more efficient processes that the underlying systems can now support.
And that’s the key. Automation is not about replacing humans but rather enhancing their productivity, transforming service delivery, ensuring compliance, improving decision making, and accelerating the digitisation of complex operations.
In essence, the revolution spoken of by Gil Scott-Heron remains true: significant change unfolds quietly, away from the spotlight. While the allure of sci-fi scenarios may capture imaginations, at the moment we are seeing strong demand for the transformative power of RPA across insurance processes to empower human expertise, not replace it. Through streamlined processes, enhanced decision-making capabilities, and refined risk management strategies, this increasingly sophisticated “background” tech is taking the foreground in augmenting our industry’s capabilities, driving us towards greater efficiency and innovation.
As we venture into 2024 and beyond, the path forward for insurers lies in embracing these transformative technologies while staying true to our commitment to customer-centricity. In this quiet revolution, the future of insurance is being shaped, not by what’s televised, but by what’s diligently cultivated behind the scenes.
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