Digitalization takes place in all respective business sectors. While more and more players in industries such as banking or logistics seem to be on the rise and increasingly satisfy their customers with digital service offerings, others are still combatting the status quo and trying to persuade consumers with their traditional business models and processes. But are these traditional business models sufficient to have a competitive edge in times of enforced global competition? We will discuss this question with the example of the insurance industry and give you the three reasons why Insurance Digitalization will become a cornerstone in your value chain.
The 3 S: Simplicity, Service, Satisfaction
Often taking the path towards a digital future is not an easy one. Possibilities are many while the required costs and resulting impact can be hard to estimate in advance. Also, formulating a coherent digital strategy which aligns with the current business strategy is often an obstacle. Therefore, there is a simple question which should be the focal point of attention when designing an Insurance Digitalization strategy: What does my customer want? The answer is service. According to a study by EY, 80% of consumers expect the availability of digital services from their insurance providers. Findings like this indicate that service levels are no longer a nice-to-have but have become an important decision factor when choosing the right insurance provider.
Within traditional document handling processes, consumers often had to deal with lengthy and non-transparent verification or claim process in form of printed paper documents. As a result, customers found these processes complicated while service levels were often low. Today’s consumer desires simplicity. An Accenture study states that the majority of customers regard claim management as a key determinant of customer satisfaction. This factor can significantly influence the customer’s decision to change insurance providers as competition is fierce and options are many. Therefore, providers which manage to design efficient and user-friendly processes will enjoy a substantial advantage over their competitors as they improve their service rates and in turn increase customer retention rates substantially.
Insurance Digitalization through Mobile First Development
Mobile phones are taking a central position in our everyday lives. Therefore, we increasingly browse the web, purchase products or interact with companies via mobile applications. Companies recognize and adapt to this development through what we refer to as a Mobile First strategy. The Mobile First trend reacts to changes in consumer behavior by targeting business design and processes to mobile phones. And for sure, it offers tremendous potential for the insurance industry. A PWC study states that almost 70% of surveyed users would download and use apps provided by their insurance companies. Therefore, offering mobile applications with an integrated scanning function (Document Scanner SDK or Scanning SDK) can be the solution to eliminate previous pain points. Examples include:
Real-Time Identity Checks
Lengthy processing of verification documents becomes obsolete when a machine-readable zone (MRZ) scanning function allows direct data extraction and automatic data processing via the app. Within this process, machine learning guides the user towards perfect scanning results. Therefore, businesses will benefit from accelerated KYC Processes and higher customer satisfaction rates.
Automated Data Extraction
Automated data extraction allows us to eliminate error rates from manual data entries. Throughout the extraction process, optical character recognition (OCR technology) is utilized to automatically recognize and extract data. Then our SDK processes these data and transforms them into searchable and editable digital formats. One of the key benefits of automated data extraction are accuracy rates, time savings and improved privacy standards through offline solutions.
Digital Claim Management
Never forget that a bad link in your value chain can cost more than it saves. Thus, quality is a crucial factor for big savings when it comes to digitalization. Avoiding early mistakes in the value chain will lead to better results in all steps that follow. Let’s take claim management by scanning invoices on a smartphone as an example. At first, the task sounds simple as a good scan can be easily automatically processed in your system. But one bad picture can lead to higher efforts on both sides, as documents have to be manually processed or customers need to scan documents twice. With thousands of incoming claims, this shortfall can negatively impact satisfaction ratings or lead to higher processing costs than anticipated. This is why it can make much more sense to license a ready to use component from a specialized company. At Scanbot countless hours of a highly-skilled team went into defining how a scan is captured best and how requirements are communicated to the user to create a perfect result.
This article shows that digitalization is a focal point in future strategy design. While there are countless possibilities to digitalize your business, a mobile-centric approach can be a good starting point.