If you didn’t know this already but things are changing across the whole insurance sector, therefore time is of the essence for insurers to start adopting technologies to help overcome key challenges in the sector and to keep up with the competition.
In our latest blog article, we take you through some of the key challenges facing the insurance sector in 2023 and how the use of digital technologies can provide game changing solutions through the power of Microsoft technologies.
Increasingly competitive markets
It is becoming increasingly apparent that a number of insurance companies are sinking in heavily siloed and outdated systems which is limiting their ability to adapt and react to changes in digital technologies. Put simply, this shows that insurance provider start-ups, who are already on board with Insurtech are causing havoc across the sector through the use of innovations in technology and modelling risk in modern ways.
In order to continue to remain competitive in the marketplace, insurance companies need to incorporate digital transformation into their overall business strategy. The use of data, automation and artificial intelligence can improve processes to modernise broker management, speed up claims processes as well as allow insight-led engagement. Straight away the overall customer experience is improved as well as this it also allows employees to harness the power of Insurtech to bring about positive business change.
As well as the above, insurers for years have been looking for better ways to collate data in one place instead of across multiple systems. A more comprehensive view of data can give firms a more rounded understanding of the journey from start to finish, which given the more competitive nature of the market is absolutely essential.
Ineffective & outdated systems
Ineffective & outdated systems are one of the main reasons for insurance companies failing to keep up with the competition. In order to meet the demands of the market, insurance companies need to look to convert paper-based information into a digital format and update their main insurance systems.
Moving to the Cloud should be used by insurers to make use of real-time data to build usage and behaviour-based packages to consolidate their positions in the market. In practice, this isn’t so straightforward as moving to the cloud brings with it a whole host of security and regulatory concerns, however these can be resolved by cloud technology which is far more secure and cost-effective than on-premise servers. Microsoft Azure is a real game changing platform that gives full cloud capabilities on Windows and Linux providing platform-as-a-service capabilities. Better still, risk and compliance can be assessed in Azure through the use of the following resources:
- Penetration testing and vulnerability investigations are regularly done by Microsoft and anything that comes out of these investigations is resolved straight away.
- Auditing reports: Microsoft regularly carries out both self and third-party audits of the implementation and effectiveness of security, compliance and privacy controls.
- Compliance manager is used to allow your firm to manage compliance activities effectively and efficiently.
As well as this, the use of Power Automate which is part of the Microsoft Power Platform can enable users to create automated workflows to enable the streamlining of processes. To apply this to the insurance sector, this can lead to much more streamlined underwriting and claims processes which in turn will result in time savings as well as improvements in overall customer satisfaction. Added to which, the use of Power BI’s analytical tools can drill down on data and provide greater insights for the business. This will make it easier for insurers to make better, more data-driven decisions by using real-time data.
Indebted from a technology perspective
Another of the main challenges facing insurers is technical debt. For those that don’t know about this, it means that shortcuts were used in the past (to comply with deadlines) rather than making use of best practices to get these tasks done leading to longer term problems.
It is common knowledge both in and outside of the insurance sector that the industry is often referred to as ‘tech laggard’ which means that companies are slow to adopt new technologies and when it does, they are only regarded as helping to solve current problems and nothing more. To put this into context, technical debt can be created through the use of siloed technologies that can't easily be upgraded or streamlined. This can hold back insurance companies at a time when competition is at its highest in particular from Insurtech start-ups.
This requires more forward thinking so rather than wasting money on maintaining costly machines with ineffective code why not take this opportunity to invest in innovation instead. Advantage is dedicated to an innovation-based strategy that is based on meeting the specific requirements of companies, understanding what they wish to achieve and ensuring that any systems developed are fully aligned with their overall business strategy. This helps to showcase the fact that these systems are futureproof and can help to support any future development.
This is where upgrading to a platform such as Microsoft Power Apps can help businesses to both extend as well as customise apps that they already have in place. Through this Microsoft Power Platform powered solution, no previous developer experience is required to create business focused apps, whereby low code is extremely easy to update as and when needed. Better still, this helps to create a solution that will enable insurers to have a comprehensive and dynamic IT infrastructure in place to adapt to the changing environment.
Changing customer demands
It goes without saying but with a digital first world, it is crucial that insurers are able to both meet and exceed customer expectations. The future generations of insurance customers are digitally led and therefore expect both online and in-person experiences. Therefore, to stay aligned to this, insurers need to adopt a digital-first approach to safeguard their business now and into the future.
Next Steps?
If you are a business operating within the insurance sector and are looking to find out more about the latest technologies that are available from Microsoft please don’t hesitate to get in touch with one of our industry experts who will be more than happy to help.
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