by Bethan Moorcraft 11
Aug 2020
The COVID-19 pandemic is a “defining moment” for the insurance
industry in that it has illuminated insurers’ inefficiencies in both their
inward and outward facing digital capabilities. It has forced innovation on the
industry more or less overnight, and has triggered a steady flow of changes
revolving around remote work capabilities, low-touch automation opportunities,
and the golden ticket – the customer experience.
These are not new themes. Insurers have been discussing technology
and innovation like machine learning and artificial intelligence (AI) for a
number of years – all with an eye to improving operational efficiencies,
reducing complexity in high-touch areas like claims, and providing the slick
and easy customer experience that people have grown to expect in the digital
age. The COVID-19 pandemic has merely injected a sense of urgency and a call to
action for those yet to progress beyond the ideas stage.
One roadblock getting in the way of many insurers’ digital
transformations is their “lack of focus,” according to Colleen Wells
(pictured), vice president of product strategy at Sapiens International
Corporation – a global insurance software solutions provider. Too often, firms
are trying to find the magic solution that will fix all of their pain points in
one go, but Wells believes insurers need to approach innovation with more of a
laser focus.
“Some companies really struggle to pinpoint what they want to
achieve; it’s so scattered in terms of what their business strategy is and what
they’re trying to solve,” Wells told Insurance Business. “I’ve seen it so
disparate in terms of insurers trying to focus on too many areas, and
therefore, not making big enough strides in innovation to make a significant
impact. Instead of being really laser-focused, striving for things like being
the best possible insurance provider for agents, or processing 100% of auto
claims in an automated fashion, some companies are trying to solve everything
in one go - and that actually slows things down.
“We are so risk averse as an industry that we don’t want to fail -
and I think that’s a mistake because we’re not embracing the power of what
digital can really provide. If you really look through a true digital lens,
you’re going fail all the time, and it’s going to be OK because you’ll learn
from that failure, and your processes will be much more improved because of it.
But at the end of the day, you have to have a goal in mind and it needs to be a
business strategy […] with a sole focus.”
One thing that Sapiens has been focused on, which Wells says might
help insurers fine-tune their focus, is really helping companies understand
what they mean by the word ‘digital’. In this day and age, the word ‘digital’
is used so generically that every insurer means something different by it. To
help form their digital strategy, Sapiens has launched a business consultancy
program with the core focus of helping insurers to understand exactly what they’re
trying to achieve through digital innovation from a business perspective.
“At Sapiens, we’ve been very focused on ensuring that from a core
offering perspective, we’re very open and we have the tool set and the
capabilities to help carriers achieve [digital] self-sufficiency,” Wells added.
“People often talk about how slow-moving the insurance industry is and how risk
averse it is, but the truth is, there are pockets of innovation happening
throughout the industry, and that was pre-COVID, during COVID, and it will
continue after COVID. It’s everywhere, and all these adjustments that we’re
making are really leading towards significant innovation. As an industry, I
think insurance is poised to make some huge changes.”
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