As an industry, we still use too much paper. But what digital tools do we really need, and where are the real changes in insurance innovation? Is it all buzzwords?
The truth is that no one is as automated as they say they are. No one is as data-savvy as they could be, and no one is certain of the best way to collaborate with insurers, brokers and legal partners. What is certain is the potential for digital solutions to help our industry, our employees, our broker partners and the businesses we support. So as digital insurance leaders, how do we develop systems that complement one another?
Near-term changes
The digital future of insurance is a plane being built as it’s flying. Somehow it’s working, but we’ve got to catch up to other industries. At Argo, we started our transformation by looking at ‘buy over build.’ This means taking a look critically at our internal knowledge and experience and determining where it makes sense to invest in the tools that would accelerate our strategy. As far as internal knowledge, we worked with our partners to expedite this transformation and reduce cost. From the investment standpoint, we began by looking at our intake and customer submission process, workflow, policy and claims management needs, and the broker relationship experience. Through this assessment process, we began to align our digital strategy to develop an enterprise-wide solution to meet the business’ requirements going forward.
Automation
As an industry, automation is still a problem. Late last year, we began to focus on implementing automated systems. These systems will generate much better data and allow Argo to look for more ways to collaborate with our partners and customers, as well as develop our in-house underwriting capability.
Submission management still needs a consistent workable digital solution. Insurers get very different types of information, and we are all looking for tools that help to automate and streamline the intake process. For example, at Argo we invested in tools like Salesforce for customer management and we partnered with Acord to create an automation and intake solution that aligns our upstream and downstream data flow and reduces costs.
The goal with automation is finding enterprise solutions that can work across business lines. As an example, we implemented a workflow solution along with our intake tool, that helps us automate how we prioritize, decline, and rate the submissions we receive. We were able to implement it in eight weeks for our Construction and Casualty teams. It’s not enough to simply apply automation solutions. We also need to make sure that systems are used properly and integrate with existing and upcoming needs. Yes, you can create and agree upon multiple solutions in one year, but you need to make sure they work well together and engage all the key stakeholders to promote collaboration and alignment every step of the way.
From a producer perspective, the time, effort and expense required to manage the submission process across many carriers is a key part of the ‘knock-on effect,’ or secondary cost to a carrier’s acquisition expense. Submission automation and real-time data capability helps reduce both producer and carrier expense, and increases service levels for the end client. By analyzing that data, Argo can better plan for future submissions and renewals, and understand an underwriter’s data requirements to automate this information. Because we are making long-term investments with these tools, we want these solutions to work across teams and business lines. The return on investment should not only cover the development costs, but ultimately bring cost savings and premium growth as we digitize more of our operations.
Using data science
To say industry historical data is not good is an understatement. While it is robust, it is completely unorganized. We all have data, but we have not figured out how best to partner in using it. At Argo, as an example, we are enlisting external partners, our data scientists, and actuaries to take past data and real-time incoming data to analyze it so that we can solve problems in Casualty claims before they happen. By understanding the data, we can train the claims team on what to look for and what warning signs to flag, before and during claims. By having a robust data science value proposition tied to a data and analytics strategy we can begin to solve the data problem and share the output with our partners and clients.
Industry opportunities
In commercial insurance when one of our partners solves a difficult problem, if no one is around to hear it, do they hold that secret alone? It shouldn’t be that way, but it is. The next frontier for digital solutions in insurance is finding out how we share data across the industry. How do we do that safely and securely? Can we automate that? Yes, we can.
Coming up with these solutions is time-consuming, but if we share data with brokers and other carriers, we can uncover huge opportunities to better insure risks and mitigate claims. As an industry, we should get together more to solve broader issues that impact us all. We could save ourselves and our clients a lot of time and capital. This is already happening in personal insurance, and as we get more digital tools in commercial insurance, I hope we will do the same. For example, a broker might have to go to 10 different underwriters to find what they need, which can take 10 days or more. That process should be automated and only take one day, but we must work together to make that happen.
Conclusion: The next phase
The next phase of the digitization of insurance will answer the following questions: How do we share data across the industry? How do we share this confidentially? How do we create solutions that help both the client and the broker?
Both brokers and underwriters want to get the best and most efficient data to one another. Brokers should not have to go to multiple insurers asking for the same information by using different systems and formats. Instead, we need better solutions and easier ways to share information. Imagine a standardized platform that allows us all to work together to better serve our customers. That’s what digital innovation can deliver to our industry if we ever decide to combine forces toward a common goal.
