Much has been written about insurers’ transition to digital in an effort to maintain business continuity as traditional sales and distribution processes were no longer an option due to the pandemic. I
In life insurance, most carriers have multi-year digital transformation roadmaps. Unfortunately, sometimes these sweeping strategies make it difficult to see what is happening in the moment. This is why so many in the life insurance industry were caught flat footed when the pandemic hit. But as the dust settles, it’s interesting to note that the vast majority of changes that carriers had to make in order to continue doing business during the pandemic were related to known points of friction in the purchasing journey.
Carriers scrambled, workarounds were deployed, point problems were patched and business continued. By tackling specific problems, carriers were able to keep the lights on during the pandemic. It wasn’t the digital transformation that you had planned for, but you made it work because you had to.
Don’t Stop Now
After overcoming big challenges in the face of crises, humans and businesses tend to skate for a while - a recovery period, if you will. This is a mistake: time is a luxury the life insurance industry doesn’t have.
Incumbent life insurers are no longer the only game in town. Several highly capitalized, digital-native InsurTechs offer consumer-friendly, digital experiences with an eye on “reimagining” the business of life insurance - and they aren’t going away. Regardless of how you sell, either directly or through advisors and agents, your digital brand experience has massive influence over consumers and their purchasing behavior.
We know this is true based on the incontrovertible success of digital-native disruptors from past decades - think Amazon and Google. And if you aren’t concerned about big tech getting into the life insurance game, think again. Amazon and Tesla are already offering auto insurance in some markets, and Apple is increasingly investing in health data collection.
When tech companies decide to disrupt a market, these markets are forever changed. Look at what Uber did to the taxi industry. Think Blockbuster and Netflix. Don’t be like Blockbuster.
Take It One Step at a Time
Odds are that you still have points of friction in the purchasing journey that you fixed with a Band-Aid when you had to. It’s time to finish what you started, and solve these problems for the long term. But don’t become overwhelmed at the thought, tackle one problem at a time.
Digital signatures are a great example. Not only was this an easy add for most, it’s a problem that has already been solved! Yes, your signature workflow may be unique to your business, but does it really need to be? Enterprise digital signature solutions already allow for customization, and it’s probably good enough to address your business requirements if you are willing to be flexible. Don’t reinvent the wheel.
This digital signature example may seem overly simplistic. My point is that for any given problem chances are that the solution already exists. These solutions may not have been designed exactly as you would have if you built it from scratch yourself, but implementing an existing solution is much faster and cheaper. Just as direct-to-consumer InsurTechs have matured, so too have InsurTechs that partner with incumbents to solve specific problems across the purchasing journey. Don’t allow perfection to become the enemy of the good -- and along with that, don’t go it alone!
Change is Hard, But Necessary
Maintaining business continuity during a global pandemic is hard but necessary. Perhaps you have a legacy solution supporting a business critical process that changed over the past year. The time is now to re-evaluate.
Instead of reverting back to your original digital transformation roadmap, think smaller, faster, and more effective. What are your top three business challenges? What is working and what isn’t? Are there existing solutions that can be implemented quickly? Make the change, and move on to the next challenge. The benefits will soon compound.
This wasn’t a realistic approach in the past because most software solutions were inflexible — this is no longer true. Modern software is more modular, delivered as a “service” and designed to solve industry specific problems.
Over the past year, your organization made more digital progress than anyone ever thought possible, because it was necessary and urgent. As we embark on 2021, don’t lose that sense of urgency that enabled the pace of change you experienced in 2020. We don’t know what the future holds, but we do know that the business of life insurance has forever changed and we must change with it.
Digital transformation is still the goal, but a slight change in approach can make these projects much more manageable. Identify and prioritize discrete business challenges and take them on one at a time. We didn’t have a choice in 2020, we had to focus on putting out the biggest fires as we encountered them. In 2021, we should be in a better position to choose the projects that will have the most strategic business impact without losing one of the most basic lessons of 2020 -- incremental changes work.
