As the insurance industry continues to navigate the speed of change, complexity, and uncertainty in our world, Consumers continue to expect and respond to companies being more responsive to their needs. This year’s underwriting forecast provides guidance on how carriers can respond more quickly.
1. Evolving cognitive technologies will help insurers capture opportunities from more discrete market segments
Technological advances in AI and data analytics are allowing insurers to further refine their market segments. As these more discrete segments grow, so do the opportunities for insurers to address them with new products and services offered through broader digital distribution channels. One such channel is embedded insurance— Incorporating insurance into the customer journey for non-insurance companies — for example, offering life insurance during the mortgage application process.
new Cognitive insurance platform These platforms underpin these new products and distribution channels, giving life insurers a way to seize the opportunity and hold tremendous potential for underwriting functions as these platforms evolve. Already, these insurance platforms automate the collection of evidence and provide recommendations based on continuously updated data analysis engines. This level of automation and intelligence allows underwriting decisions to be made in real time. Cases that require further scrutiny are automatically referred to a human insurance company. With much of the evidence gathering already completed, insurers are free to focus on further analysis, leading to more efficient decision-making. This is a clear competitive advantage in rapidly changing digital distribution channels. We believe that innovation in this field will continue to evolve over the next year. In fact, in our report, Accelerating the future of insurance Page 11 describes how a Chinese life insurance company is leveraging AI and smart algorithms to improve operational efficiency and customer experience.
2. Customer experience continues to drive underwriting innovation
last year’s Underwriting forecast, we discussed how customer experience determines who wins the digital race for new business. We expect this trend to continue, but there is a growing awareness of consumer expectations and how insurers can respond more quickly to changing needs.For example, our Accenture Insurance Consumer Research Survey We found that it’s not just millennials and younger consumers who are embracing digital experiences. The 55+ cohort is becoming more comfortable with digital interactions. And digital customer experience is critical if insurers seek to attract and retain customers. Underwriting plays a pivotal role in supporting digital customer experiences, especially with the proliferation of customer experience technologies available through ecosystem partners.
As our industry moves from coverage to protection products, digital technologies will be essential to delivering differentiated experiences that leverage these platforms and ecosystems to capture opportunities from new product innovations. . We believe that product and underwriting innovation will be a significant source of revenue in the coming years. However, we need to expand our use of AI, automation, data analytics, and cloud. Increase profits and drive revenue.
By modernizing traditional core systems and freeing up siled data, insurers can automate underwriting workflows and deliver faster digital purchasing experiences, while helping apply the right level of risk management. Allows you to connect to additional data sources. This not only shortens underwriting times and lowers costs, but also improves the customer (and underwriter) experience. Similarly, it supports the seamless, proactive, personalized, and advanced experiences that consumers are demanding.
According to a Gartner® report (Richard Natale, Kimberly Harris-Ferrante, August 2022), “By 2027, digital underwriting will reach mainstream adoption in the life insurance industry, resulting in an increase in revenue and underwriting. will significantly increase profitability and improve customer experience.”
3. Human-machine operating models can help alleviate underwriting skills shortages
Digital technologies such as AI and automation will not replace underwriting. On the contrary, the need for these technologies will only increase as insurance companies face an ongoing shortage of skilled workers. Furthermore, they We need talent and investment strategies that target digital skills and no-code/low-code capabilities in data analytics. Flexible workforce to optimize underwriting capabilities.
For example, as the use of third-party data increases; AI and automation It provides an efficient way to capture data and make it useful to insurance companies. This leaves underwriters free to do what they do best: assess and price risk.—while promoting timely and effective decision-making. What is stopping them is administrative work. 40% of the timeaccording to our Survey of 500 U.S. life insurance underwriters.
The first step is to improve back-end underwriting efficiency. interoperability In addition to using an integrated technology stack across platforms and ecosystems, it is key to simplifying all customer-facing functions such as product distribution, marketing, sales, service, and commerce. The cognitive platforms mentioned above can help here as well. As insurers improve their digital capabilities and become able to respond more quickly to changing consumer needs with more individualized insurance products and distribution channels, underwriting capabilities must keep up. This human-machine combination improves the experience for insurers and potential policyholders.
This is good news for the insurance value chain and reinforces my optimism about our industry and insurers’ ability to meet the challenges and opportunities that lie ahead. we are ready to help. Let’s talk About making the most of technology and human ingenuity.
Accelerating the future of insurance: Modernizing technologies such as AI and cloud-powered data analytics can help insurers achieve profitable growth through both increased revenue and reduced costs.
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