Research from PwC shows that the digital revolution has well and truly arrived for the insurance industry, with 71% of consumers having used some form of digital research before buying a policy. Around 26% of consumers currently purchase their plans online, with this number set to continue rising, particularly amongst the millennial generation.
Most insurance companies are focused on leveraging an e-commerce model to sell their traditional offline services in an online ‘store,’ but the leaders are developing deeper, more personal and longer lasting relationships by utilising digital capabilities to improve the knowledge base of their customers.
Engaging customers through social media channels can derive business insights that help insurers understand consumer sentiments, preferences and behaviour – key components to making good business decisions.
Nitin Rakesh, CEO and president of Syntel, says that it is clear that, like other industries, insurance is witnessing the need for digital modernisation, brought on by the need to cater to digital native consumers. “Digital natives expect an omni-channel experience that allows them greater accessibility to anytime, anywhere services – something that may be difficult for traditional insurers to deliver.”
Shifting consumer demographics put greater pressure on companies to optimise their businesses or risk falling behind their competitors. Rakesh asserts that insurers feeling this pressure should explore solutions to digitalise and mobilise their biggest asset, their data.
“In a competitive market environment, speed and agility are vital for insurance companies to survive and grow,” says Rakesh. “Because CEOs are now being measured on their ability to quickly adapt to the changing digital environment, it is vital to seek out a trusted service provider with the necessary expertise.”
A recent report from IDC states that two-thirds of CEOs will be focused on digital transformation strategies throughout 2016. In the past, transformation has more traditionally been the dominion of CIOs, which underscores the importance and business critical nature of these decisions.
“With many insurers stuck with business critical legacy systems, the biggest challenge is to keep pace with digital innovations while maintaining and automating business critical legacy systems,” Rakesh says. “Automation allows for faster and more cost-efficient transformations to take place.”
“These systems are the final frontier for companies,” said Rakesh. “Both are an essential part of the process, as automating archaic or outdated systems frees up the resources required to push ahead with new innovations that provide exciting products to the more demanding 21st century consumer.”