Tag Archives: the cloud

Data Security to Be Found in the Cloud

As the insurance industry continues down the path toward digital transformation, it is being inundated with data being generated by many different connected devices and systems. Enterprise data is growing so rapidly that analysts at IDC predict the worldwide volume of data will increase ten-fold to 163 zettabytes by 2025. 

With the rise in volume and accessibility of data, comes an increased risk of data breaches. In the first half of 2019 alone, nearly 4,000 data breaches occurred, resulting in more than 4 billion records being compromised. On top of these challenges, insurers are also subject to an ever-changing list of complex regulatory requirements and industry standards meant to strengthen data security and consumer privacy. From the EU’s General Data Protection Regulation (GDPR) to the Payment Card Industry Data Security Standard (PCI DSS), the New York Department of Financial Services’ (NYDFS) Cybersecurity Regulation to the Insurance Data Security Model Law, insurers face a complex regulatory landscape. 

Strategically moving some core business functions to the cloud can provide insurers with many benefits that can address these challenges head-on, including increased data security, business flexibility and scalability, better ease of compliance and reduced infrastructure and capital expenditure costs.

The insurance industry has been hesitant about cloud adoption, due in part to the widespread use of legacy technologies, a desire for single-handed control of data and the nature of being a highly regulated industry. Yet, when done right, moving key systems and IT functions to the cloud can benefit insurance firms in spades. Innovations in the cloud can make it easier for organizations to not only comply with industry standards but also better safeguard customer data, all while providing a great customer experience.

How the Cloud Can Help

According to Gartner, expenditures toward cloud-based enterprise IT offerings are increasing at almost triple the rate of spending on more traditional, non-cloud solutions. The firm also found that more than $1.3 trillion in IT spending will be affected, directly or indirectly, by the shift to the cloud by 2022. This trend underscores the many benefits that organizations are reaping from the shift to the cloud.

To realize these benefits, insurance organizations must start joining the pack and look to migrate key parts of their business and IT infrastructure to the cloud. For example, providers can strengthen data security and ease compliance with PCI DSS by moving their payments systems to the cloud. Because insurers process and store tremendous amounts of sensitive consumer data and personally identifiable information (PII) – like Social Security numbers, bank account numbers, dates of birth and payment card numbers – insurers are prime targets for hackers. Traditionally, when a customer calls an insurer to make a payment, the customer speaks with a service representative and reads payment card details aloud over the phone. Likewise, if the customer uses the website to make a payment, sensitive payment card information is collected via a web form or e-commerce platform integrated into the insurance company’s computer network. In both scenarios, as soon as the sensitive data enters the organization’s network infrastructure, the insurer is responsible – both from a compliance perspective and in terms of customer expectations – for protecting that data. By making the shift to a secure, cloud-based payments processing solution, organizations can keep sensitive payment card data out of their infrastructure completely, thus reducing the risk of a data breach and minimizing the scope of compliance for numerous regulations. 

See also: The Cloud Concept That Many Miss  

How Cloud-Hosted Payments Solutions Can Strengthen Data Security

Let’s say a customer chooses to call an insurer to make a payment. Cloud-based, dual-tone multi-frequency (DTMF) masking solutions, for example, allow callers to give their payment card data securely over the phone. The customer simply enters the card number directly into the telephone keypad. The DTMF tones of the telephone keypad are replaced with flat tones, making them indecipherable to an agent on the line or to a nefarious eavesdropper. Alternatively, the agent could send an SMS text message with a secure payment hyperlink to the caller’s mobile phone. The caller simply clicks on the hyperlink and enters payment information. In either scenario, the agent is able to stay on the line in full voice communication with the customer for the duration of the transaction, helping to troubleshoot, if necessary, and providing a frictionless and secure customer experience. Because a cloud-based payments solution sits between the telephony carrier and the contact center’s network, the payment card data is encrypted and securely routed directly to the payment service provider (PSP) for processing – keeping the sensitive data out of the organization’s network infrastructure completely.

Likewise, if a customer uses the insurer’s website to make a payment, cloud-based digital payments solutions can make the transaction more secure and provide a better customer experience, all while streamlining regulatory compliance. Say a customer is interacting with a customer service representative via web chat. When the customer wants to make a payment, the agent can send a secure payment hyperlink to the customer right in the chat window. The customer clicks on the link and is presented with a secure web form, where the customer can enter payment card information. Again, the sensitive payment data is routed directly to the PSP and never enters the insurer’s network.

In all the scenarios described above, both the insurance provider and the payment channel (telephone, SMS, the webchat solution, etc.) are kept out of the scope of compliance for GDPR, PCI DSS and other regulations. At the same time, these cloud-based digital payments technologies can relay real-time progress updates that inform the agent when the link has been opened, when payment information has been collected and whether the payment was approved by the PSP, providing the business with powerful insights into the status and success of collected payments.

By handling payments in the cloud, insurance providers can dramatically reduce the amount and types of sensitive data they process or store – making themselves less of a target for hackers and reducing the scope of compliance for numerous industry standards and regulations. Moreover, by moving their payments to the cloud, organizations can reduce costs by eliminating the capital expenditure related to hardware, and enable greater productivity across their IT teams by offloading the task of maintenance and updates to third-party service providers.

Additional Benefits of Moving to the Cloud

Cloud-based technologies offer unmatched flexibility, scalability and nimbleness compared with traditional, on-premises IT solutions. Here are just a few benefits of adopting a cloud-based solutions:

  • Greater Resiliency and Reliability – because many cloud solutions are able to accommodate thousands of customers at once, these platforms offer a greater level of reliability at a lower cost than insurers could typically afford independently.
  • Geo-redundancy – cloud-based payments solution providers have geo-redundant data centers, resulting in an additional level of backup in the rare case that the main payments system fails – a necessity for companies to consistently and reliably ensure customer satisfaction.
  • Scalabilitycloud solutions enable organizations to quickly and easily scale up on-demand, without requiring additional investment in on-premises hardware.
  • Cost Control – tightly tied to flexible scaling options, cloud payments solutions often result in better cost control and allow organizations to take advantage of economies of scale, compared with investing in on-premises infrastructure. This ability to save on up-front hardware costs is especially important for fast-growing businesses.
  • Less Equipment – depending on the deployment option, firms can migrate their payments systems to the cloud and have little to no equipment to maintain, allowing their IT and infrastructure teams to focus on more strategic projects.
  • Quick and Easy Implementation – cloud implementations are typically faster and less complex to get up and running than on-premises deployment models. 
  • Easier Software Updates and Bug Fixes – because cloud payments solutions are most often managed by service providers, insurance companies can relieve themselves of the burden of having to manually update software and patch bugs.

Security Comes First – Cloud or No Cloud

While the insurance industry has traditionally been hesitant to migrate important functions such as IT or payments systems to the cloud due to security concerns, it is important to remember that the challenge is not in the security of the cloud itself. In most cases, data breaches are the result of a user – not the cloud provider – that has failed to follow or enforce appropriate security policies and controls. As long as the organization enacts proper security policies and trains its employees on the importance of following them, it should have no worries about cloud solutions adding security risks.

That said, security should always be a top priority for companies, whether they are using on-premises or cloud-based solutions. It’s important to carefully select a provider that adheres to the highest security and compliance standards. When choosing among cloud-based payments solution providers, make sure they have achieved industry-accepted certifications like ISO 27001, PA DSS and PCI DSS Level 1 certification. (Here is a helpful guide that explains the different PCI compliance levels).

See also: Why the Cloud Makes It All Happen  

As insurance organizations struggle to keep pace with an increasingly dynamic business landscape, a deluge of sensitive customer data and ever-more-complex regulatory requirements, they will find that migrating their critical systems and functions to the cloud will provide the nimbleness and flexibility they need to remain competitive. Cloud payments solutions can help optimize costs and provide scalability, while enabling stronger security, easier compliance and a superior customer experience.

3 Ways to Boost Agency Productivity

In the not too distant past, consumers went to independent agents for all of their insurance needs – whether simple or complex – because insurance was often an elusive concept to the man on the street. At the same time, insurance coverage was considered something everyone must have, so when insurance-related questions came up, many consumers’ initial instinct was, “I have to talk to my agent.”

Over the past few years, this paradigm has shifted toward consumers being much more willing and able to build an understanding of their needs. This trend is broadly seen across nearly every industry and is accelerating in insurance. While the trusted relationship with an agent is often still crucial, insurance consumers today are researching, purchasing and interacting with the insurance industry in new ways, and increasingly on their own terms. In working with agencies and end consumers around the industry, we think the shifting behavior of consumers can be summarized in two key ways:

  • The Knowledgeable Consumer
    This consumer actively researches insurance online and consults his peer network prior to purchasing policies – either online or in person. How can you quickly and effectively service these consumers before they research other options or take their business elsewhere?
  • The Always-On Consumer
    This consumer wants information anytime, anywhere via any device, be it smartphone, tablet or desktop computer. These consumers don’t want to stop by your office for an auto ID card or certificate of insurance. How can you give them access to their insurance information when and where they want it?

One thing these two types of consumers have in common is the expectation for instant access to information. From an agent’s perspective, providing a mechanism for online service allows for an improved experience by allowing consumers the flexibility to interact with your agency when and how they want. And while there may still be a window of opportunity for this to be considered as a differentiator for the agency, the day is approaching where nearly every consumer will expect and demand it of the agency. Consumers who don’t get this immediate accessibility and flexibility will take their business elsewhere. Further, by pushing common transactions online, agencies can free resources to focus on higher-value service interactions with consumers.

As seen across nearly every industry, advanced technology should be a key element of the agency strategy to meet these business objectives and the evolving expectations of insurance consumers. Agencies and brokerages are able to become more productive with relative ease thanks to enhanced data, mobility, better communication and increased adoption of third-party apps and other tools.

As an agency considers its business strategy, I’ll suggest there are three key considerations when it comes to the role technology solutions can play:

  1. Standardize and Dissect Your Data
  • Standardized Workflows
    To the extent it makes sense for your business, workflow consistency can yield real productivity gains and help capture comprehensive and better customer risk and demographic information your agency can use to better market, account round and engage customers. By leveraging standardized workflows, agency owners are ensuring data entry is consistent across an agency – regardless of location. Additionally, standardized workflows reduce the number of workarounds conducted by staff – increasing productivity at the outset and reducing any potential time spent rectifying workarounds at the back-end. The result will be improved quality and completeness of the underlying data.
  • Business Intelligence
    Over time, agencies and brokerages generate an immense amount of data – yet it can be difficult to access, analyze and understand that data in meaningful ways. Business intelligence (BI) solutions are one way to help turn all of that data into information. For example, principals can identify which producers are using their time most efficiently and driving the most revenue for the business. Principals can also evaluate how effectively their business is cross-selling and quickly identify new market opportunities. While traditional reporting can take hours if not days, BI solutions present your information in immediate and visual ways that drive new insights, enabling you to make more effective decisions to improve productivity and business growth.
  1. Think Easy Access
  • Mobile Technology
    New mobile technology affords producers all of the benefits associated with management system access within an office, without having producers tethered to a desk. This allows them to be more productive and to respond to clients and prospects more quickly and in the manner that current and prospective customers want and expect. For smaller agencies, where employees wear multiple hats within the organization, giving your employees access to tools when they’re away from the office is critical.
  • Online Access
    Consider how your business can leverage the cloud to drive productivity gains. The ability for service staff to work from home via the cloud, when needed, supports work-life balance and allows business to go on regardless of unexpected events. 
  1. Time Is Money
  • Paper No More
    Evaluate ways to become an all-digital agency and eliminate paper. Agencies and brokerages should leverage electronic signature and delivery of client documents, which reduces the time and expense of mailing paper copies.
  • Carrier Information Exchange
    Productivity gains have increased over the years as carriers improved their interface and as agencies better understood how and where to enter data in carrier systems. The vast majority of agencies use personal lines policy detail download to reduce rekeying of data, saving, on average, 81 minutes a day per employee. In addition to download, using real-time for service and rating saves agency employees as much as an hour per day. Policy download yields daily time-savings of nearly an hour and a half per department employee for personal lines and nearly an hour for commercial lines. Take the time to automate communications with your carrier on the front end to save more time over the long term.
  • Online Client Self-Service
    As mentioned, today’s insurance consumer increasingly expects information anytime, anywhere. Agencies need to provide clients the ability to access policy and billing information on their terms, which helps strengthen relationships, ensures high retention rates and drives revenue gains. Self-service capability can increase staff productivity and decrease costs in commercial lines, as well as personal.

Technology will allow you to work faster and, in turn, will redefine the products and services you offer to your clients. While working faster is one thing, using technology to provide mobile access, enhanced communication and streamlined procedures to more quickly serve clients will also drive new business and customer retention.

For additional insights on how to use technology to bolster agency productivity, check out our eBook, “Working Smarter: Finding Agency Productivity Gains.”