“The digital disruption that has transformed sector after sector, from publishing to travel, has come to insurance as well. Consumers are expecting a differentiated digital experience,” writes Muthu Kumaran. “Insurance CIOs need to embrace and enable digital innovation, as well as communicate new ideas about digital ways to work.” Excerpts:
“To overcome the challenges and make good on the opportunities, insurance CIOs must transition from being coordinators who focus on consolidating and integrating innovative solutions, to being digital change agents who provoke change and drive business digitization. To get there, insurance CIOs must:
- Take a hands-on approach to addressing digital opportunities and challenges.
- Invest more time in their internal leadership network and manage their relationships more actively.
- Ensure the understanding of technology drivers and make sure their impact is distributed across the leadership team.
- Establish IT as a talent engine, renewing skills and enticing digitally-savvy, high-potential individuals into the organization.
“Being digital” goes beyond developing a few mobile apps, launching a Web portal or moving a system or application to the cloud. It requires making digital a core element of how the company operates and seamlessly blending physical and digital components to deliver new value to key stakeholders, whether they are policyholders or business partners.
Digital initiatives that provide high ROI are eliciting a lot of interest. Usage-based insurance (UBI) is one of the top areas for digital ROI, and no wonder: Insurers have discovered that when policy pricing is tied to human behavior, they can improve their loss ratios.
With insurance CIOs recognizing that the customer experience is largely shaped by digital technology, it’s also not surprising that omnichannel customer experience is another top area for digital return on investment.
A third area of high ROI is robo-advisors. Using technologies such as natural language processing (NLP), speech recognition and virtual assistants, insurers can embrace innovative ways of transforming the customer experience.
Insurers are also using artificial intelligence-based technologies such as robotic process automation to reduce repetitive tasks and free agents to undertake more complex work that requires human elements, such as creativity, empathy and complex decision-making.
While the transformation to digital might seem daunting for many insurance CIOs, accustomed to a conservative, cautious environment, the change will be worth it.”
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