How Should Insurance Companies Look At the Current COVID Impact
Today, the insurance sector faces a daunting set of constantly changing business challenges. To survive and thrive during these exceptional times, it’s imperative to innovate and disrupt to adapt seamlessly to the changing situation. It’s time to deliver in a moment that matters.
The coronavirus outbreak has dramatically impacted all business establishments, with forces shaping the next normal. The pandemic has had a profound impact on the insurance industry as well. With a surge in health, travel, and business interruptions claim, and with the economy in the middle of a slowdown, it’s a stern test of resilience for this industry. With 0.9 percent growth decline predicted in FY20 for insurance companies in India and global premium income expected to shrink by 3.8 percent in 2020, the sector is now facing unique challenges.
In India, recently, Insurance Regulatory and Development Authority also asked the insurers to adopt simplified claim procedures for COVID-19 cases, process other claims within the prescribed period by making special efforts, and put in place a business continuity plan. Insurance companies must leapfrog into the digital age, enter new markets through new distribution channels, and create new operating models. An end-to-end purchasing process that used to take upwards of 22 days has reduced to 5 - 10 minutes with these digital interventions.
The lockdown restrictions have severely affected businesses. However, a positive trend emerged from this critical phase. We saw the insurance industry coping better than most would have ever imagined, thanks to the technologies that have been gradually emerging to accelerate the sector’s adaptability to the current pandemic scenario.
Insurance today is protective gear. A prudent financial action that is both preventive and collective and helps you address contingencies such as a pandemic. The perspective of consumers today has evolved where they are ready to view insurance as a ‘must –have’ and not just ‘good to have’. No longer is it considered as an investment or a tax saving instrument but a new ‘essential’ in their healthcare repository.
The insurance industry is plagued by legacy systems, technologies and processes, and in many cases, legacy thinking. And organizations that ride this wave of transformation with the right technology and agility will sustain themselves. A shift to a ‘customer-centric’ business in addition to ‘distributor centric’ model is now most needed. Customers expect seamless, paperless and personalized experiences across contact channels, from policy application to claims. That’s why every insurer today must be enabled to offer digitized product solutions that addresses individual customers’ need to stay relevant.
Only cost-efficient processes with higher productivity will make for complete recovery in FY21, with credit asset and credit quality taking an upward path. The government has announced various programs to boost the digital adoption of payment. With the industry’s integration with fintech, companies will likely come out of this phase, stronger and better. Innovation is inevitable, and the industry must accelerate its digital transformation.
Trends that will shape the future of the insurance sector:
• Consumers will shift their view from digital being a channel conflict to channel enabler.
• Online engagement of customers, with a paperless system of working.
• Technology software will be embedded in organizational processes.
• Rise of InsureTech ecosystems with dozens of valuable, pre-integrated technology partners.
• Comprehensive and cost-effective administrative services.
• Companies will be ready to take transformational risks.
• Expanded distribution channel capabilities (both online and offline) to foster greater market reach.
What will be uncompromisable for companies’ post -COVID would be the necessity to adapt to a customer-centric model. Customers expect the same fast, one-click purchase experience and 24/7 service they expect from online vendors like Amazon. They want to communicate digitally with their insurers for easy tasks like a beneficiary, address changes and also deal with knowledgeable customer service representatives for complex issues.
With customer-centricity reigning supreme, insurance carriers should adopt a digital service solution that automates the entire customer acquisition process, from application to approval, from underwriting to policy issue. The customers get a streamlined, no-touch online application process, which takes just moments to get approved. This kind of 360-degree integrated digital approach will help the industry mitigate the damages caused by COVID-19.
Businesses will bounce back and pave their way out of this uncharted territory. It is crucial to keep up with the changing dynamics and the rapidly evolving needs of the market. It’s also a time for organizations to work towards purpose-driven goals contributing to the greater good. Your organizational agility has to be strong enough to continue delivering value and unique proposition to customers and communities.
The coronavirus outbreak has dramatically impacted all business establishments, with forces shaping the next normal. The pandemic has had a profound impact on the insurance industry as well. With a surge in health, travel, and business interruptions claim, and with the economy in the middle of a slowdown, it’s a stern test of resilience for this industry. With 0.9 percent growth decline predicted in FY20 for insurance companies in India and global premium income expected to shrink by 3.8 percent in 2020, the sector is now facing unique challenges.
In India, recently, Insurance Regulatory and Development Authority also asked the insurers to adopt simplified claim procedures for COVID-19 cases, process other claims within the prescribed period by making special efforts, and put in place a business continuity plan. Insurance companies must leapfrog into the digital age, enter new markets through new distribution channels, and create new operating models. An end-to-end purchasing process that used to take upwards of 22 days has reduced to 5 - 10 minutes with these digital interventions.
We saw the insurance industry coping better than most would have ever imagined, thanks to the technologies
The lockdown restrictions have severely affected businesses. However, a positive trend emerged from this critical phase. We saw the insurance industry coping better than most would have ever imagined, thanks to the technologies that have been gradually emerging to accelerate the sector’s adaptability to the current pandemic scenario.
Insurance today is protective gear. A prudent financial action that is both preventive and collective and helps you address contingencies such as a pandemic. The perspective of consumers today has evolved where they are ready to view insurance as a ‘must –have’ and not just ‘good to have’. No longer is it considered as an investment or a tax saving instrument but a new ‘essential’ in their healthcare repository.
The insurance industry is plagued by legacy systems, technologies and processes, and in many cases, legacy thinking. And organizations that ride this wave of transformation with the right technology and agility will sustain themselves. A shift to a ‘customer-centric’ business in addition to ‘distributor centric’ model is now most needed. Customers expect seamless, paperless and personalized experiences across contact channels, from policy application to claims. That’s why every insurer today must be enabled to offer digitized product solutions that addresses individual customers’ need to stay relevant.
Only cost-efficient processes with higher productivity will make for complete recovery in FY21, with credit asset and credit quality taking an upward path. The government has announced various programs to boost the digital adoption of payment. With the industry’s integration with fintech, companies will likely come out of this phase, stronger and better. Innovation is inevitable, and the industry must accelerate its digital transformation.
Trends that will shape the future of the insurance sector:
• Consumers will shift their view from digital being a channel conflict to channel enabler.
• Online engagement of customers, with a paperless system of working.
• Technology software will be embedded in organizational processes.
• Rise of InsureTech ecosystems with dozens of valuable, pre-integrated technology partners.
• Comprehensive and cost-effective administrative services.
• Companies will be ready to take transformational risks.
• Expanded distribution channel capabilities (both online and offline) to foster greater market reach.
What will be uncompromisable for companies’ post -COVID would be the necessity to adapt to a customer-centric model. Customers expect the same fast, one-click purchase experience and 24/7 service they expect from online vendors like Amazon. They want to communicate digitally with their insurers for easy tasks like a beneficiary, address changes and also deal with knowledgeable customer service representatives for complex issues.
With customer-centricity reigning supreme, insurance carriers should adopt a digital service solution that automates the entire customer acquisition process, from application to approval, from underwriting to policy issue. The customers get a streamlined, no-touch online application process, which takes just moments to get approved. This kind of 360-degree integrated digital approach will help the industry mitigate the damages caused by COVID-19.
Businesses will bounce back and pave their way out of this uncharted territory. It is crucial to keep up with the changing dynamics and the rapidly evolving needs of the market. It’s also a time for organizations to work towards purpose-driven goals contributing to the greater good. Your organizational agility has to be strong enough to continue delivering value and unique proposition to customers and communities.
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