Developing digital transformation roadmaps

Insurers would do well to avoid getting caught up in all the hype surrounding digitalisation. There really is no one size fits all approach to embrace this. Much of the process when it comes to developing an effective digital transformation roadmap comes down to strategically aligning the insurer with its business goals. Once that is done, the practical elements of how it could technically work, will help guide the steps to take.

Of course, the risk of having sight of the ‘big picture’ view of what the company is working towards can result in the temptation of trying to do everything all at once. This is not only a costly exercise, but the complexity involved in doing so makes it an incredibly risky proposition. Instead, decision-makers at the insurer must break down the components into smaller steps. By doing so, they can implement faster and derive value from the digital transformation roadmap sooner.

Even with the best planning in place, digitalisation can mean one thing today and something else in the future. Just consider the technologies shaping business in the current environment. The digital landscape could (and most likely will) look significantly different in two years’ time. Therefore, it becomes paramount to embed a degree of flexibility into any plan. By taking a step-by-step approach, the insurer can re-evaluate often and ensure future steps are still relevant when the time comes.

One vision

Decision-makers must also communicate with employees across the value chain so that they can understand the ultimate goals the insurer will be working towards. This could entail a continuous process of alignment from all the stakeholders. Again, it shows the value of taking smaller, iterative steps as opposed to just having a single, long-term plan that is cast in stone.

The COVID-19 pandemic has certainly helped in this regard. Insurers understand the need to be more agile. The cycles of technology advancement are accelerating all the time. And with this comes the need to embrace more digital channels than before.

Balancing the past with the future

In South Africa, this does require a more nuanced approach given the digital divide that exists between early adopters and those still struggling with even basic internet connectivity. However, if an insurer uses technology in the right way, it can cater for both segments.

For instance, the more affluent market wants to have self-service channels to manage their policies without having to deal with a broker. They want a direct channel with the insurer providing a click-through on its Web site for more information, link to a customer portal, or to apply for a policy. This type of customer might even want to make changes to his already existing policy portfolio through some sort of direct digital engagement with his insurer.

The less connected customers, some who are even unbanked, require a different approach. In this instance, an insurer can equip its brokers with tablets or mobile phones to facilitate an onboarding process when they travel to informal settlements. This also gives the broker the opportunity to educate potential customers around the importance of insurance, resulting in an improved and more personal service experience.

Furthermore, the way insurers collect and pay out premiums to the unbanked can take the form of mobile wallets or other mobile-friendly transactions. This also ensures that people have cover and that claims can be processed as efficiently as possible.

Join me next month as I discuss some of the key considerations when it comes to digital transformation in insurance and how that influences the roadmap planning.

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.

SilverBridge 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.