Demystifying automation in insurance

4 min read

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How to make the most of the automation ecosystem

5 min read

 

Spixii’s extensive experience in the insurtech space has clearly shown that, for the vast majority of insurance use cases, chatbots alone are not enough.

It is exactly this realisation that urged our team to redefine the role of insurance chatbots (which became 2016’s talk of the town), and to include them within the wider world of Conversational Process Automation.

Parallelly, we observed a substantial increase in the area of process automation over the last decade, thanks to the support of more sophisticated technologies and the advent of insurtech. The insurers that invested in process automation reaped enormous benefits.

Yet, unfortunately, we still see difficulties for the majority of insurance companies in embracing new technology due to high reliance on legacy systems.

The prospect of making huge efforts in transforming business through automation with a plethora of available options might be discouraging. However, we’ve happily witnessed our clients attaining success through their beachhead strategy of starting with simple use cases, generating value and expanding sustainably.

In this blog, we are going to distinguish among the different automation solutions and give a vision of how it could be implemented within an insurance business.

The status of insurance core systems

The majority of insurers set up their core systems during the 90s, leveraging new communication and information sharing possibilities unlocked by the internet. Although core systems such as policy, claims and billing systems gradually expanded in their capabilities, the technology underneath hasn't evolved or kept pace like it did in the finance industry. As a result, insurers suffer from the legacy systems syndrome that obstructs further digitisation.

On top of this, the notoriously strict regulation of insurance looks with suspicion at any cloud-based service and in extreme cases demands every new technology or application to be built on-premises.

But all is not as lost as it seems. There are solutions that can enhance insurance operations and make the industry technologically competent.

Backend solutions

The first type of backend solution is automation platforms. At their core, these platforms are built to automate and streamline day-to-day processes.

Robotic Process Automation (RPA) focuses on the automation of small and repetitive back-office tasks through the employment of digital workers. It drastically reduces the chance of human errors and reduces record-keeping burdens on the employees. Due to its powerful capability in saving resources long-term, the global RPA market is expanding rapidly as per a 2020 Forbes prediction. By 2023, it is projected to reach $12 billion.

Another form of automation is low-code platforms that allow the design and handling of processes through an intuitive graphical user interface instead of traditional hand-coded computer programming.

Basically, a low-code platform cuts the hassle of expensive, customised applications and allows both developers and non-tech profiles to create something unique for the company. There is no heavy-handed code to be tweaked which saves the developers’ time and creates a responsive customer experience.

The second type of backend solution is insurance-specific platforms. Parallelly to the setting up of insurance core systems, some new insurance platforms started to appear in the market as direct alternatives for insurers looking to upgrade their software. These include policy, billing and claims systems.

Frontend solutions

The previous solutions are improving the performance of internal processes, resulting in great reduction of operational costs. However, an interaction between an individual and an insurance business that relies uniquely on such solutions still remains “mechanical.”

This is where CPA comes into play. CPA, at its core, aims to reconcile insurance processes with humans. This obviously implies a great emphasis on a simple and personal end-customer experience while ensuring efficiency through automation.

To make this possible CPA embraces chatbots to translate robotic insurance processes into fluid human interactions. With chatbots, insurance becomes a conversational experience, personal and contextual at the same time with structured output that’s “digestible” by core systems or automation layers.

Putting the pieces together

RPA, low-code and insurance platforms are great at automating backend processes. Their efficiency highly depends on the initial input. Insurance processes start with customer-facing interactions, which often translate into unstructured data that RPA and insurance platforms are not able to handle.

CPA bridges this gap by ensuring that the frontend experience or the interaction with the customer is optimal and the conversational output is directly linked with core systems or middle integration layers.

As a specific example, let’s see how Spixii CPA is linked to the wider automation ecosystem:

Spixii CPA integration strategy

  • Customers engage in insurance conversational experiences powered by chatbots. Every conversational experience is tailored to a specific process (claims, customer service, quote & buy).
  • The same conversational experience can be enhanced through embedded insurance handled by affinity partners. For example, an airline company that offers travel insurance as an option can have a chatbot mirroring their own brand but running the same (or a variation of) conversational process of the insurance provider.
  • Chatbots are linked to the insurer’s CPA platform where the conversational process is designed, managed and monitored with data insights to nudge continuous improvement.
  • Within the CPA platform, the Function Manager allows any integration with core insurance systems (even legacy systems!) either via direct API or via low-code, automation and RPA platforms.
  • All data collected by chatbots, and meaningfully organised through dashboards is available in the CPA platform and can potentially be exported in excel format if insurers rely on internal dashboards.

Although quite advanced, the above automation scenario is not a dream. As proof of this, Spixii already partnered with some of the key automation players, packaging off-the-shelf insurance solutions with pre-built integrations.

We partnered with Blue Prism to augment their RPA with our CPA solution to expand the level of automation from back and middle office to the front part, directly in interaction with the end customers. You can find more about it here.

We also worked with Appian to connect both platforms resulting in an embedded solution that enables straight-through-processing (STP) and no-touch claims automation for P&C, Health and Life insurance.

Lastly, we created a solution in collaboration with Duck Creek, a leading core insurance provider. It enables insurance customers to submit loss information in a personal, immediate and 24/7/365 available channel while allowing insurers to scale their claims processes through further automation, creating a win-win for both parties.

Conclusion

The only thing worse than being blind is having sight but no vision

- Helen Keller

While many businesses recognize the importance of the newly ramping up technology, they are still hesitant to fully embrace innovation. This creates an unconscious blindspot for insurers that prevents their businesses from truly expanding. As an insurtech provider, it is our deepest ambition that insurers recognize the value that technology solutions bring - not for the present solely but also for the future.

Many have sight. All they need is to craft their vision.

Illustration of robot with light beam

Discover Conversational Process Automation

CPA allows end-to-end processing through chatbots and leverages advanced analytics to continuously improve both the underlying process and the conversation with the end-user.

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