So… Where is Technology Taking Us?
I’ve been around the Insurance industry my entire life and like all other industries, the life Insurance industry has become highly technical. Insurance technology in our industry improves consumer services, increases profitability and productivity and increases returns to the company shareholders.
It’s amazing how the life insurance industry has been transformed in the last 13 years, from the way that insurance companies record and store transactions to risk assessment and policy management. In order to understand the impact of technology, it is important to have an overview of the traditional practices of the life insurance industry.
It’s not too long that you would find a life insurance agent sitting in an office waiting for the phone to ring so that they could offer the next prospect a number of policy plans to get insured from any unforeseen event. In those days, the customers often drove to the office and listened to an insurance salesperson use sales tactics that encouraged them to buy the policy plans. At the time, without the Internet, it was difficult if not impossible to get information about life insurance or life insurance policies for that matter and Insurance agents relied on newspaper advertising, yellow page ads and referrals to attract new customers.
From the customers’ point of view, when it came time to get a life insurance policy started, it almost always required in person, physical interaction with an insurance sales person.
Most operations within the insurance company were also dealt with manually. The information of the customers was gathered physically and then stored in a manila folder, tucked away among all the other files in the file cabinet. Similarly, other aspects of underwriting also lacked automation, which increased the work burden and created problems that slowed down the decision making process.
After the advent of the Internet and other technological initiatives, the life insurance industry has transformed completely.
Here is a “Jody Humphrey” look at a few areas that I have identified that are changing the direction of the industry and will continue to influence our space for years to come.
The Impact of Insurance Technology…
Prior to the Internet, most of the Insurance industries internal processes that were separated that and had no collaboration of any kind were highly standardized. In other words, even though you kept policy guidelines in a paper document, the excel document you referenced to evaluate pricing quotes was closely associated with the paper document.
Since this was already the case, when data management evolved via the web, this existing framework reduced data redundancy and enhance the overall efficiency of most industry processes. The collaboration of data and its manual usage through the incorporation of specially designed software programs further reduced the chances of faulty information going from one location to the other. Transmitting data via the Internet securely has become the norm within the industry today and continues to transform how we access information.
Social media is shaping the way we now communicate with others and it is playing a huge role in insurance technology. Traditional sales presentations are now conducted through social media channels. Target markets are selected through customized search features and new prospects identified using targeted demographics and analytic tools. Customer can share stories with others, and shoppers can “weigh in” on experiences, trends and topics of interest. In the future, Social Media may also become a component of risk management, customer service and sales strategies.
The development of various decision-making software programs utilized by the industry has resulted in better performance related to investment and other financial decisions. This has increased the profitability of the companies dealing with life insurance products and reduced the cost to consumers for coverage.
Over time, improved technology has enhanced the means of building customer relationships. Customers now gain access to almost all of their information through online portals. From 24-7 connectivity to instant chat, communicating has become far easier than the old times.
The advent of Smart Phones and mobile technology has also made customer service more accessible from any place at any time. Customers can use mobile applications to gain access to details of the policy purchased, outstanding claims, and much more, additionally, smart algorithms and machine learning further improve and reduce the time required to resolve an Insurance Policy issue.
The development of advanced situational comparison software programs within today’s insurance technology or what is often called a “comparison quoting engine” has led to the availability of real-time insurance comparisons for prices offered by various life insurance companies. Ultimately, this capability has fueled competition within the industry and the customer is the winner. Customers receive the highest benefit, firstly, in terms of knowledge as for where to get the right product for the right situation and secondly from the competitive pricing offered by the industry players.
Technology will continue to impact our industry, from web based software to artificial intelligence, the immense use of the internet, mobile applications, and social will continue to advance our industry. In a world full of unknowns, one thing we surely know is things will continue to change.
Here’s to Your Success – Jody Humphrey