Insurance modernisation critical for business success

Even prior to the onset of the COVID-19 pandemic last year, insurers were under pressure to modernise their legacy systems as customers started expecting more agile solutions capable of benefitting from advances in digitalisation, the cloud, and even machine learning technologies. Global events over the past 17 months have accelerated the need for this as an increasingly connected customer base now demand tailored solutions reflecting the world of today

According to research, insurers can capture three primary areas of value by transforming their business model and modernising their core IT systems. The first is increased gross written premiums and reduced churn. According to McKinsey, flexible, digitised product systems enable insurers to revamp their product innovation process, translating to faster time to market. Secondly, increased operations productivity. By overhauling legacy environments, insurers can improve processes and enable employees to become more effective at doing their jobs. And finally, reducing IT cost. Modern IT systems can reduce the cost of infrastructure reliant on a commodity hardware approach versus one more adaptive to a cloud business model.

Changing focus

Up to now, legacy infrastructure has proven to be relatively stable, reliable, and able to handle large amounts of data. Furthermore, these systems permeate virtually every aspect of the insurer’s business. However, the limitations of a legacy approach means that the time has come for insurers to reinvent themselves and embrace a more modern and agile way of meeting evolving customer demand. It is no longer a question of if change must occur. Instead, it is a priority to modernise and digitalise as quickly and effectively as possible.

But beyond addressing customer needs, insurers must also mitigate the risk of the rising number of insurtechs bringing meaningful change in the competitive landscape. With this comes the potential to enhance existing capabilities by partnering with them to leverage each other’s strengths. This does require a willingness to change and embrace collaborating with partners the insurer ordinarily would not have considered previously.

Another consideration is mergers and acquisitions. Insurers need to preserve value for investors. Adopting more sustainable and agile digital infrastructure ensure this can happen. It also equips the insurer with the ability to respond to emerging challenges especially given the continued lockdown conditions in South Africa

Legacy shift

The success of insurance is built on security, trust, and the ability to deliver solutions that meet customer needs especially during these critical times. As part of this, self-service becomes an important consideration especially when moving away from legacy systems. Empowering customers to manage more themselves gives them a sense of control over their policies and other products. Simply put, legacy environments do not offer that degree of flexibility.

These usability elements include enhancing the customer experience when using digital channels, making claims processes clearer, or providing additional customer service channels through more contemporary routes, like social media – all of which can be enabled by technology.

Ultimately, modern insurers require modern systems that are digitally-driven. So, while legacy fulfilled a critical role in the past, the time has come to change and become more agile for the connected world today.

Exergy incorporates sophisticated OCR functionality into Exergy

As testament to its ongoing commitment of delivering digital features that enhance the client experience, SilverBridge has incorporated Azure Form Recognizer technology into the Exergy product suite. This enables insurers to automate the extraction of information from forms, images, and documents.

“As a Microsoft Managed Partner, SilverBridge remains at the cutting-edge of technology innovation and focuses on ways to modernise and digitalise Exergy to reflect the digital transformation needs of our customers. Using machine learning technology to identify and extract text and structure from your documents, will significantly increase the customer experience and result in accelerated business processes,” says Annalie Terblanche, Head of Product at SilverBridge.

Even though key insurance processes such as client onboarding and claims management have already been automated in Exergy, they still required human intervention to verify the quality and correctness of the documents received. Incorporating text extraction (OCR) into the Exergy product suite, enables SilverBridge to drive straight through processing and move even further away from manual processes. You can focus more time acting on the information rather than compiling it, resulting in reduced turnaround times with new client applications, amendments or claims assessments.

“Supporting documents submitted during onboarding, amendments and claims processes can now be automatically verified using this OCR functionality integrated into Exergy to automate underwriting and other administrative requirements. Our clients are excited about the potential of this enhancement and are looking forward to efficiencies it will introduce in their digital processes,” says Terblanche.

Azure Form Recognizer applies advanced machine learning to accurately extract text, key-value pairs, tables, and structures from documents. Users can quickly get accurate results that are tailored to their specific content without heavy manual intervention or extensive data science expertise.

“We are in a time where technology is one of the core ways that our partner ecosystem can better serve its customers. It brings with it an opportunity for innovation, and partners like SilverBridge, continue to look for ways to help their customers realise true digital transformation through solutions like Exergy,” says Lionel Moyal, Commercial Partner Director at Microsoft South Africa.

 

Hollard digitalises customer onboarding with SilverBridge

SilverBridge Holdings has replaced the manual- and-paper based process of onboarding new customers at Hollard Namibia with a digital environment across its intermediary and call centre channels to improve new business turnaround times and conversion rates at the largest privately-owned insurance group in the country.

Its intermediary channel was reliant on a manual process of completing policy application forms. From a call centre perspective, Hollard agents used spreadsheets to complete new applications and then subsequently captured those on the Exergy policy administration system.

“Having had a long-standing relationship with Hollard, we proposed digitally enabling both these critical channels to link the various stakeholders to a centralised solution and automate the process. This digitally-driven environment would link directly to the Hollard Policy Administration system and Exergy,” says Leonel da Silva, Portfolio Manager at SilverBridge.

This would be done through the SilverBridge Intermediary and Call Centre Web portals. Both these are accessible from the Web requiring only a stable internet connection. By digitalising these channels, Hollard intermediaries would be able to track the performance of their books in real-time and identify trends related to policy cancellations, lapses, and other relevant areas.

Through enabling Hollard to digitally onboard new customers and proactively manage retentions in real-time, the insurer would speed up the end-to-end onboarding process and positively influence the conversion rate and efficiently drive growth within the business.

“SilverBridge’s digital platform and support throughout Hollard’s digital transformation has successfully put us in a position where we reached our internal digitalisation goals and are now geared towards our ethos of excellent client service,” says Charlton Cloete, Head of IT at Hollard Namibia.

 

Insurers embrace disruption with reskilling of talent

Over the past 16 months, the ways people work and live have been fundamentally impacted. The expectations are that even following the COVID-19 pandemic, organisations across industry sectors can no longer revert to their traditional approaches. Insurers have already taken this to heart and have redoubled efforts to modernise and digitalise not only their systems and solutions but also their employees.

A distributed workforce has become part of the new operating standard. This is not to say the transition has not been without its challenges. Financial services providers like insurers who used to rely on meaningful in-person engagement with customers on a broker level, have needed to rethink how to effectively harness technology to still provide a quality experience. And with the enforcement of the Protection of Personal Information Act (POPIA), this must be done in such a way that personally identifiable information is kept as secure as possible.

McKinsey examines the importance of a ‘survive and then thrive’ strategy that balances digitisation, improving operational efficiency, improving cybersecurity defences, and enhancing the customer experience. Within all these elements lies an opportunity for insurers to reskill teams, identify new capabilities, and rethink the nature of jobs in the sector.

Thanks to the likes of robotic process automation, machine learning, and artificial intelligence, an increasing higher level of automation can be introduced in traditional administrative-heavy job functions. In turn, this frees up those vital human resources to deliver on more strategic requirements that can help the insurer enhance the customer experience and differentiate itself from agile insurtechs.

Refocus

One of the most significant things that have emerged from the pandemic has been the opportunity to reaffirm the purpose of insurance. It comes down to protecting people, communities, and business from unexpected risk while embracing rising societal concerns around sustainability and fairness.

Workforce agility, capacity, and scalability will be instrumental to drive this in the new normal. Insurers must be able to adjust to shifts in claim volumes and customer service inquiries, or even demands for new products more reflective of modern end user requirements. This means that an insurer must be able to reallocate resources quickly and think differently about the strategic (company culture) and tactical (employee skills development) functions.

Business leaders now need to embrace different ways for employees across job functions to reach their objectives. It is no longer about the hours worked but rather the deliverables achieved. Nine-to-five work is no longer a reality. An insurer is therefore reliant on putting key performance indicators in place and measuring the success of the workers in achieving those.

Pivot

Adaptability and collaboration will be the cornerstones of this digital-centric workplace. This talks as much about the insurer’s ability to work with trusted partners as it does with employees that are based in any geographic location. In fact, collaboration will be geared towards finding the right expertise for specific job functions. This gives the insurer the ability to create a highly connected network of specialists that can build on the wealth of data it has in place.

Insurers must pivot from predominantly responding to customer and broker queries, to helping them through challenging times. By focusing on the social context of the situation and customer needs, an insurer can imbed non-traditional advice and support for customers that differentiates them from competitors. As such, creating an employee experience that promotes engagement, motivation, and wellbeing will be as important to rejuvenating the business as modernising and digitalising operational processes.