How Are Insurtechs Driving the Biggest Insurance Industry Changes?
Check out how insurtechs are bridging the pixelated gap for the industry.
Digital-first, full-stack Insurtechs are leading the way in online strategy, but Insurtechs that offer software and customer support to agencies are helping bridge the pixelated gap to the online world, says Jason Keck, founder and CEO of Broker Buddha.
Digital transformation is a hot topic throughout the insurance industry at every level. Online-only Insurtechs have platforms optimized for digital-first encounters and provide a seamless web experience for the user that can be hard to keep up with for their brick-and-mortar competition.
And the competition is real. Highly-digital insurance agencies grew 70% faster than their counterparts last year, demonstrating the favorable customer response to digital adoption.
According to Fintech Futures, the Insurtech market is set to grow 46.1% by 2030, reaching a total market size of around $114 billion. While the insurance industry, like many others, faces challenges related to inflation, global conflicts, climate change, the COVID-19 aftermath, and data security, these challenges also represent opportunities.
For incumbent agencies to stay competitive, adapting and thriving online is the first step in unlocking future possibilities. So, let’s explore how Insurtechs are driving the most significant changes in the insurance industry’s digital transformation.
Keeping Up the Momentum
While customers may be used to automated forms and personalized services in other industries, the insurance industry needs to catch up in many places. There’s a saying: “If it isn’t broke, don’t fix it,” For many, the insurance industry was just that.
However, the pandemic sparked investment in digital transformation across industries, and the insurance industry, in particular, benefited from a premiums surge that contributed some extra cash to the endeavor.
For many agencies, the move to revamp websites and online processes had been a long time coming. With digital transformation rife elsewhere, customers have come to expect high-quality web experiences from their service providers. Unfortunately for the insurance industry, common pain points can still include manually transferring data, incorrectly completed forms, and lengthy processes requiring much back and forth between agents and their clients.
It’s the sparking of change for this reduction in lengthy procedures that Insurtechs have been invaluable. For more traditional incumbent agencies nervous about adopting, Insurtechs are there to hold their hand and lead the way into digital transformation. After all, even if a company is keen to embrace digital transformation and can afford the tools to make it happen, the value is lost without proper guidance and training on how to use them.
To build on the momentum of adoption and upgrades generated over the past few years, Deloitte’s 2023 insurance outlook suggests setting strategic plans, budgets, and investment priorities. What reputable Insurtechs do is provide the software for revamping online processes and the meticulous and comprehensive service needed to implement change effectively.
See More: How to Ensure Successful Digital Transformation
Navigating Change
Insurtechs aid incumbent agencies to stay competitive and get ahead of digital natives. Unlike newcomers, traditional agencies can utilize their reputation as trusted brands and lean on their experience in the field as unique selling points. Combining these elements with a high-quality online experience is the not-so-secret recipe for customer acquisition and retention in the digital age. But how can traditional brands successfully navigate their move online?
Change management continues to be a challenge in the industry, and mobilizing teams to use what new technologies are available is essential to drive momentum. The most productive digital adoption comes from having formal change management processes in place. Technology is only useful when people know how to use it, so supporting teams to ensure they are well-versed in new tools and techniques is one-way Insurtechs are helping to drive digital transformation.
Migrating submissions to a digital experience is lengthy, as renewals come annually. Attention to detail is vital when migrating data, and Insurtechs can be invaluable when providing support in the transfer. A company’s full transformation to digital submissions can take months, with initial training and post-implementation check-ins included.
The difference between buying software and using it effectively depends on the people involved. When adopting new software, Insurtechs should provide a training period where they identify key team members for senior roles in the change management process. Selecting these people early on means they can help oversee a frictionless transformation, support and train others, and empower them to lead in the future.
Upgrading Customer Experience (CX)
How can you know when a digital transformation with the help of Insurtechs has been successful? Often it’s the customer behavior that speaks the loudest.
Customers are now used to high-quality online interactions with brands and service providers; 88% of online shoppers say they wouldn’t return to a site with a poor user experience. The insurance industry needs to embrace technology to stay competitive. But creating a seamless CX is about more than just looking good. Personalizing online interactions is now essential, with fast-growing companies in one McKinsey report citing more than 40% of their revenue coming from personalization techniques.
Upgrading the CX journey through an enhanced online process and design is another way Insurtechs drive change in the insurance industry. Website design contributes significantly to a company’s credibility, as does the level of customer personalization. Insurtech provides incumbent agencies with the tools and guidance to get ahead of their online-only competitors.
See More: Does Customer Service Improve Customer Experience?
The rapid growth experienced by highly-digital agencies demonstrates customer demand for improved online processes. Being asked to repeat information multiple times is a common pain point in the customer experience. Automating and having forms follow conditional logic – where they show the next question based on the previous answer – solves this problem and many others. Companies need to develop more customer-centric practices to excel in the future, and removing CX friction is an excellent place to start.
For many traditional insurance agencies, this transition to online is easier said than done. Offering comprehensive support for teams when it comes to digital transformation is where Insurtechs are driving the most significant changes in the industry. After all, technology only works well if the people using it know how to use it. So educating teams on how to use newly available tools is vital to ensure the value of digital transformations is truly realized.
What transitions can the insurance industry expect as an impact of using immersive tech? Share your thoughts with us on Facebook, Twitter, and LinkedIn. We’d love to hear from you!
Image Source: Shutterstock
MORE ON INSURANCE TECH
