This insights article is by Sanjay Radia, chief solutions architect at NETSCOUT
In the digital age, insurance policyholders are constantly seeking streamlined experiences and fast solutions, such as instant quotes, efficient claims handling and ongoing customer support. To meet these demands, insurance companies are increasingly capitalising on data analytics and other technologies to offer customers personalised and optimised digital services. For insurers, delivering satisfactory customer experience begins with ensuring the quality of their applications. This requires maximum visibility into their network, which allows for constant monitoring of customer-facing applications.
In order to keep up with developing customer and business needs, many insurers are accelerating their migration to the cloud – a trend highlighted in the Capgemini Research Institute’s World Cloud Report on Financial Services. Although 91 percent of banks and insurance providers began migrating to the cloud in 2020, full and effective adoption remains a challenge, with over half of businesses having migrated only a small portion of their essential business applications. Yet, this transition is key to maximising the benefits of artificial intelligence (AI), which is now being used to improve customer experience and internal processes. Against this backdrop, it is imperative to consider how these technologies are transforming the insurance sector to better meet customer expectations.
Data analysis for personalised services
The strategic use of data has already begun to revolutionise the insurance industry by providing an in-depth understanding of individual customer behaviours, preferences and risks. Insurers can tap into a variety of sources to deliver highly personalised services, such as customer interactions on social networks, data from IoT devices, and mobile information. In this way, they can ensure consistency between digital and physical interactions, which is essential for a seamless customer experience.
Usage-based insurance (UBI) applications are a prime example of this smart data usage. Looking at car insurance for example, UBI applications analyse parameters such as speed, distance travelled, and location to automatically and accurately adjust insurance policies. This technique allows for a more precise and personalised risk assessment, offering pricing that truly reflects the driving behaviour of customers. Safe drivers may receive more favourable rates than riskier ones, enhancing their loyalty and promoting safer driving habits.
In addition, the ability to integrate and analyse different types of data gives insurers the flexibility to respond quickly to customer expectations. For instance, during the pandemic, changes in travel patterns enabled insurers to adapt their service offerings. This resulted in more appropriate and often less expensive policies for their clients, demonstrating the industry’s ability to respond to the changing times thanks to the insights available.
AI and the cloud: close allies
According to a McKinsey report, the integration of AI and the rise of IoT-connected devices are at the heart of transforming customer experience in the insurance sector. By 2025, the number of these devices could reach a trillion, generating a vast amount of data that will enable enhanced personalisation and real-time pricing adjustments. McKinsey also notes that deep learning models, such as convolutional neural networks (CNNs) which classify and recognise images, will optimise underwriting and claims management, reducing decision times to just a few seconds.
Migration to the cloud and use of modern microservices architecture are revolutionising applications and infrastructure, enhancing both the flexibility and scalability of systems. These adjustments, coupled with cloud services such as serverless computing, strengthen the accuracy of predictive models and customer satisfaction, which are crucial in a market that values customisation and responsiveness.
However, challenges such as network latency can affect the accuracy and speed of services, inhibiting the customer experience and translating to potential delays in adjusting insurance rates. For this reason, insurers must have complete visibility into their network in order to identify traffic bottlenecks and instances of poor bandwidth, which will in turn help minimise network latency.
The importance of network visibility in digital insurance
Even with robust strategies and advanced technology, insurers can still face challenges with application performance and service disruptions. This is why it is vital that insurers know when their applications are available, how they are performing, and how quickly their IT team can troubleshoot issues. Developing an awareness of how effectively applications function is the most important element in improving customer experience, ensuring it is seamless and secure.
To enhance this awareness, insurance companies must turn their attention to the quality of their network visibility. Having optimum visibility into their network allows them to monitor network traffic and data at packet level in real time. This allows IT teams to not only detect and respond quickly to network performance issues, but also to anticipate and mitigate potential security risks.
This ability to accurately monitor and analyse network data enables insurance companies to maintain high-performance online services, which are crucial to customer satisfaction. For example, increased network visibility can prevent service interruptions by detecting behavioural anomalies that could indicate potential network failures, slowdowns and even malicious activity. Enhancing this monitoring with continuous, round-the-clock active testing of services from various global locations can guarantee consistent availability and performance, thereby safeguarding a company’s reputation and revenue.
Furthermore, data obtained through network traffic analysis is indispensable for ensuring smooth operations and improving real-time decision-making. This is particularly important in scenarios where network performance can directly affect critical processes, such as claims processing or live risk assessment.
Ultimately, success in the insurance sector is increasingly reliant on the strategic integration of solutions that enhance internal operations management while also enriching the customer experience. A continuous commitment to digital innovation is necessary not only to meet current customer needs but also to proactively anticipate them.
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