Rapid Digitalization: The Winners and Losers

Insurance industry priorities have shifted dramatically this year, and leading insurers are turning to digital for scalable solutions. Brendan Jackson, VP Marketing at Surfly, a market leader in co-browsing and video chat solutions, offers insight into insurance industry needs for digitalization in the aftermath of COVID-19.

In early March 2020, the Insurance Information Institute released its first-quarter Global Macro Outlook, which offered a grim look into the extent of COVID-19’s impact on global growth and the insurance industry. It’s likely to be ‘deeper and wider than the current consensus’ and could last well beyond the third quarter of 2020, and as a consequence, we’re seeing some major changes in carrier attitudes toward going digital.

One of the first major industry shifts we saw was an immediate push towards digitalization, with some companies finding it easier to adapt to this sudden uncertainty. Great Eastern Life Singapore is one such insurer; it first enabled Singapore-based clients to apply for insurance policies online in February, and recently outlined further plans for digitization, including co-browsing with customers and simplifying the remote policy process. Because of a digital-first approach, the agents at Eastern Life were able to build on their preexisting online services, such as the Great Eastern E-connect web portal, to adapt to their customers’ needs during the pandemic.

It’s clear that ‘rapid process digitization’, as reported by McKinsey, could give carriers quick wins in terms of cost reduction, lowered error rates, and increased CSAT scores, along with driving significant improvements in expense ratios. But digitalization integrates these same digital approaches across the board to transform processes, services, customer engagement, and revenue streams – and without a view towards digitalization, carriers often find themselves falling short of what are quickly becoming expected industry standards.

Carriers that are quick to adapt are also finding it easier to keep workforces connected and customers satisfied, like AXA, one of the world’s largest insurers. AXA agents created a fully remote policy flow for their customers, offering them convenience, connectedness, and clarity on complicated matters during an unstable time. This included drafting, signing, and even the first payment – the system was completely secure and efficient to implement, with over 1000 agents onboarded in under a week.

Conversely, we’re finding that carriers who were reluctant to implement new solutions without a clear immediate incentive to do so reported struggling to adapt to three immediate challenges in the wake of COVID-19:

• More pressure on customer support
• Inability to conduct meetings in-person
• Security issues with screen-sharing and co-browsing solutions

In a recent article on trends in a post-COVID world, Anirban Chaudhry asserted that

‘insurance firms must now focus on implementing intelligent automation and digitalization for efficient claim processing/adjudication, underwriting, etc. to provide better service levels to customers.’

This was also supported in the same McKinsey study mentioned earlier, which found that ‘carriers are digitizing processes … often without major technology infrastructure upgrades, and in time frames measured in weeks or months.’ This tracks with our experience that carriers are looking for solutions that are easy to implement and to scale in the long run, as they see customer needs already evolving to demand and expect better collaborative services for remote support.

While large-scale digitalization may not have been high on the agenda in January, the global pandemic unceremoniously upended priorities for the foreseeable future. Carriers are now looking for solutions that have an API architecture that can be easily integrated into their own systems for quick, real-time collaboration that keeps customers connected and satisfied, even in uncertain times.