The life insurance industry experienced a significant setback in 2020, largely due to COVID-19. Many businesses had to shut down, which led to a shift in people’s financial priorities. Life insurance became less of a concern, as food, rent, and health essentials took precedence.
Fortunately, the outlook for 2021 and beyond looks exceedingly positive. The pandemic highlighted the importance of preparedness for every eventuality, resulting in a renewed interest in life insurance and similar products.
This simply means that it’s the perfect time to modernize the way your company manages policies in order to deliver better services. The good thing is that you have a wealth of life insurance innovation options to choose from, including software solutions.
Here are some things to keep in mind if you’ve yet to start on any modernization initiatives or if you’re looking to optimize what you already have:
It’s Best to Choose a Central Management System
Collaboration is important in any company, but particularly for insurance companies that routinely conduct a variety of processes. There are some simple tools that can help in this regard, including email and online task management tools. However, insurance simply has too many facets and the details can easily get lost in an endless email thread.
Thus, it’s ideal to acquire a management system that allows individual and group administration. This way, you can eliminate the hassle of dealing with multiple platforms and at the same time get a 360-view of policies. In turn, this can help you better manage risk exposure and identify areas that need more support.
A single policy management system also helps improve operational efficiency, especially since you can change business rules for different products using only one platform. Of course, using only one solution also drives down the cost of maintenance.
Modernization Can Be Used for Insights
When you employ software solutions for policy management, you’ll have access to a ton of up-to-date policy data. You can then use these to analyze business health and even test various models so you can plan how to respond to certain unexpected circumstances (e.g., the COVID pandemic).
You should also look into having a separate data repository, so that you can access information and run reports without affecting the main production database. This helps reduce security risks and optimize performance. What’s more, if you have a separate storage for policy data, it’s easier to optimize the information for reporting and analysis for various business and regulatory purposes.
Modernization Is Key to Speed Up Time-to-Market
Technology has, for lack of a better term, spoiled consumers. Practically everything can now be purchased online, in the comfort of one’s home. High-speed internet has shortened hours-long downloads into mere seconds. It’s inevitable that this kind of expectation has also bled over to the insurance industry, with customers continuing to expect faster turnaround times.
Fortunately, life insurance innovations have harnessed various facets of technology to speed up a lot of aspects of insurance policy administration and management. For one, there are insurance software solutions that come with pre-built product templates that make it easier to develop and customize insurance products. This allows you to get your products out much faster, giving you more opportunity to increase profits and serve a wider range of customers.
Streamlining Is Easier With Tech
One of the more tedious aspects of insurance is the amount of paperwork that it generates. Thankfully, modernizing insurance policy management also includes integrated data streams and automation options. This combination results in faster issuance times and a shorter policy application process overall.
Outside of automation, productivity tools such as video conferencing apps can help with policy management by creating an easy, hassle-free method for client communication. The pandemic gave rise to the popularity of remote meetings, and is expected to continue for at least a few years. Your insurance company would be remiss if it failed to incorporate this element—simple as it may be—in your modernization plans.
Modernization Is Crucial for Compliance
A market conduct exam or audit is a necessary part of the insurance industry, to make sure that an insurer has acted in the best interest of consumers. Your company has probably undergone a few of these audits over the years, which means you’re probably also familiar with the amount of work needed for full compliance.
Modernizing your policy management system can help address issues with compliance. For one, with a central management system, you’ll have full traceability of every transaction. The data is also stored securely, and every check-in and check-out is automatically recorded.
Modernization Actually Reduces Costs
While your insurance company may have to make an initial investment for modernization, costs will definitely be reduced in the long run. As previously mentioned, using a centralized policy management system instead of multiple platforms can drive down maintenance costs.
Moreover, legacy systems are becoming more expensive to maintain over the years; replacing them with newer ones will do wonders for your operational budgets, allowing your IT department to focus on tasks that add greater value. Using a modern policy management system also reduces the risk of errors, which in turn reduces or eliminates delays that cost the company money. Last but certainly not least, modernization helps you to make a huge step towards going paperless and thus minimizing your expenses on postage and supplies.
As you can see, modernizing your policy management using life insurance innovations can help transform various facets of your business. If you don’t have a clear-cut plan yet, perhaps it’s time to develop one and push through with it strategically to harness all of its benefits.