The past year saw the insurance industry respond to a pandemic, increased cyber risks and several natural disasters. As 2021 draws to a close, all eyes are on insurers to protect customers, so insurers must increase their flexibility and agility. But how?
With exciting developments in SaaS-based technologies now facilitating much easier underwriting, the next focus in insurance innovation needs to be the product itself. The traditional approach to product creation, using an almost universal contract base and only altering small sections or refiling certain aspects, will slowly fade into disuse.
Because of all the technology and data now available, each separate market niche can contain products with unique contracts. SaaS-based systems allow companies to manage a plethora of distinct contracts, responding to changing needs in real-time and customizing combinations according to specific requirements. Companies that are unable to keep up, and continue to rely on ISOs and traditional product manufacturing methods, will become dinosaurs as new insurtechs leapfrog them in the market. The quicker that organizations embrace modern product management and design methods, the faster they can bring these new lines to market, another key to staying ahead of the curve.
Time to market is essential, and the clock is ticking
Now that the product manufacturing process is much easier to conduct, with capabilities to subdivide product lines, build niche products and customize products to different customer needs, the insurance world can move much faster. Of course, harnessing the power of technology will make for better products -- that is a no-brainer -- but the early birds in insurance in 2022 and onward will catch the worm.
Insurers must move quickly: designing, testing and bringing to market products in a matter of weeks or months, not years, if they want to capitalize on new areas of coverage. This will convert more clients and generate new revenue streams at speed, but it will also respond effectively and intuitively to customer’s needs. Despite widespread advances in new technology, some insurers still see speed as a stumbling block if they are hampered by legacy policy administration systems and cumbersome internal processes. No insurer can afford to take a long time to innovate in today’s market, and when speed is the resting pulse of success, transformation is key to achieving it.
See also: 2022 Will Challenge Health Insurers
The top priority must be the customer
From making product creation more agile to moving more quickly and efficiently, a modern insurer must always refer back to one thing: the customer. There is still so much to be done to innovate the purchasing process for the customer’s benefit: from customization of product offerings to improving customer-facing communication. Intelligent insurers will invest in perfecting the human element of their entire service, thinking deeply about the customer journey and ensuring that the process is as seamless as possible.
Consumers today have the digital world at their fingertips and, in most instances, can be highly demanding and selective when it comes to the quality of experiences. Consumers already receive immediate results in many industries – swift food delivery, instant book downloads and information within seconds. However, in insurance, consumers still must wait several days or weeks to receive a quote. Yet again, technology is the silver bullet to solve the troubling issues of traditional purchasing methods for insurance customers. With more agile, rapid systems, the back and front office of a company can work in harmony to design and deliver the products their clients require, without long lead times aggravating the customer in their time of need.
When setting out priorities for 2022 and beyond, a quick-thinking insurer will look to innovate the products they create and how they are creating them, always with the customer at the forefront of their mind. It will be this speed and agility that sets companies apart, as coverages continue to evolve and needs continue to change. The insurance revolution is already underway, and innovation is no longer a choice: It is a necessity.