Technology has enabled life insurance businesses to grow at an unprecedented pace. From smart wearable devices to telematics, everyday innovation is touching every segment of our day-to-day lives, which is, in turn, propelling the life insurance industry forward. Given this foundation, becoming digital-first is no longer an option for businesses that want to thrive in the highly connected, hyper-competitive environment. Here is a look at why life insurers should consider adopting a digital-first mindset and how to go about it.
Benefits of Adopting a Digital-First Approach in Life Insurance
There are countless ways in which technology has changed the life insurance industry. Operations are streamlined, claims processing is automated, and agents can collaborate better with insurers. However, the key benefits of adopting a digital-first strategy in life insurance can be summarized into the following:
- Customer Experience: Adopting a digital-first culture enables life insurers to offer a more seamless and consistent experience for clients. It helps them leverage digital channels for purchasing policies, processing claims, handling customer queries, and more. These digital channels such as life insurance software improve reachability and service convenience, thereby paving the way for increased customer satisfaction and loyalty.
- Higher Agility: In recent times, geopolitical tensions such as that caused by the Russia-Ukraine conflict, paired with the fatalistic combination of inflation and impending recession, have led to businesses looking for agility and resilience to stay afloat. As such, introducing technology to business processes is one of the most effective ways to make the organization more agile and resilient. Becoming digital-first not only opens up new opportunities but also helps you navigate the complexities of the unforeseeable future.
- Better Reach: Insurers that wish to succeed must cater to digital-first customers. Armed with a digital-first strategy, life insurance businesses can expand their reach to include customers who might have not been reachable via traditional channels. By running digital marketing campaigns and selling policies online, life insurers can expand the customer base beyond their physical locations.
- Data Analytics: Digital-first organizations inevitably have a larger digital footprint than their counterparts. The data collected from various digital sources can help life insurers gain actionable insights into customer behavior, marketing and sales initiatives, product/service performance, etc. They can then leverage this information to fill in market gaps, identify opportunities for cross-selling and upselling, personalize the customer experience, and make informed business decisions.
How to Become a Digital-first Organization?
Follow these steps to ensure your life insurance business is on the path to becoming a thriving digital-first organization:
Build an Effective Digital Roadmap
The very first step towards becoming a digital-first organization involves creating an effective digital strategy. After all, turning digital is not an overnight process. Digital strategies focus on harnessing technology and related innovations for improving business performance. Ensure that your digital strategy clarifies the values, goals, target audience, key performance indicators (KPIs), journey map, and resources required to achieve the desired outcomes.
Choose the Right Technologies
Digital transformation is not limited to document digitization or workflow automation. It affects the entire organization as whole. However, with so many tech solutions and platforms to choose from, navigating the digital-first strategy can be tricky. Instead of choosing technologies that look good on paper, start with adopting tools that your business truly needs on a priority basis. Invest in digital technologies that can help optimize processes, improve data collection and analysis, and enhance the customer experience.
Make Provisions for Training
A data-first vision would be incomplete if you fail to acquire buy-in from all the stakeholders. To do so, you will have to carry out intense training programs that sensitize employees on the value of making the switch. Training would also equip them with the knowledge and practical exposure to use digital tools and platforms effectively. This would reduce the time-to-value and allow teams to drive results from day one.
Collaborate with Digital Partners
Aligning the right technologies with business processes is something that many insurance businesses struggle with. The complex, never-ending task of digital transformation becomes more streamlined and efficient if you find the right technology partner. Collaborating with digital partners such as InsurTech companies and technology vendors can help you bring innovative ideas, technologies, and practices to the organization.
Prioritize the Customers
Modern-day customers expect hyper-personalized and seamless digital experiences. As such, focusing on the needs of customers enables life insurers to meet their ever-changing needs and expectations. Hence, in your digital-first strategy, make sure to incorporate digital channels and interactions that are intuitive, responsive, and personalized to meet the needs and expectations of customers.
Measure and Iterate
Measure the success of your digital initiatives regularly and use the findings to identify areas for improvement. Periodically iterate and improve digital processes and offerings to stay ahead of the competition and meet changing customer needs. In doing so, you would be setting your life insurance business on the path of continuous improvement and continuous innovation, which will make it sustainable and resilient in the long run.
The above guide is just the tip of the iceberg for making your life insurance company digital-first. Insurance companies, regardless of their size or industry vertical, should opt for InsurTech solutions that can lend direction to meet this objective. At Damco, we help insurers penetrate the digital insurance ecosystem and extract long-term value from it. Get in touch with our experts to know how we can help you reach your organizational goals.
Case in Focus
One of the largest life insurance companies that relied on legacy systems and disconnected data was struggling to keep up with the competition. Damco helped the client overcome the challenges associated with disparate, legacy systems by creating a branded customer experience portal that connected customers and partners across various lines of business. As a result, the life insurance company was able to save over 2 million dollars annually and improve the customer experience. The detailed case study can be found on Damco’s website.