Zac Cohen, COO of identity verification provider Trulioo, looks at what digitisation means for insurance
The term digitisation isn’t just a synonym for digital transformation; it has a very specific meaning. Digitisation describes any process or action that, having previously been undertaken without the help of computers, has now been taken over by technology. Essentially, any analogue process that is now done by computers has been digitised.
Digitisation can offer key direction for insurtech companies as they branch out to encompass more of the insurance industry. Innovators that keep abreast of new technologies will be able to stay a few steps ahead of their competitors.
How digitisation is transforming insurance
There are three areas where it’s having the most impact:
Improved customer experience. Much of the digital revolution, both inside and outside the insurance industry, has been driven by the quest to grow revenue by improving customer experience. As with any other fintech service, insurtech is concerned with maintaining security and protecting personal data, while still bringing all the advantages of industry 4.0 (the fourth industrial revolution, which ‘will take what was started in the third with the adoption of computers and automation and enhance it with smart and autonomous systems, fuelled by data and machine learning’, as it’s been described in Forbes).
Processes that are ripe for digitisation have, until recently, been those that involve a lot of repetitive tasks and movement of forms and paperwork. Advances in technology now mean that more challenging tasks are also open to digitisation. Quicker and easier customer onboarding helps reduce abandonment, which unlocks value over the customer’s lifetime.
On-demand customer service also leads to better retention and satisfaction. For example, advanced chatbots are able to take on relatively complex aspects
of customer service. Self-service portals have become more advanced and offer many more services and features compared with even a few years ago.
Increased administrative efficiency. The more basic end of digitisation has been helping to automate everything from a customer’s initial purchase,
right through to claims processing. A combination of automation and self-service features, added to the fact that information no longer has to physically move from one location to another, has helped speed things up in many industries, not just insurance.
These improvements free up staff time to focus on more complex, value-adding activities, including any final decisions that can’t be made by machines alone. The metrics available from digitised services can also be used in conjunction with machine learning to optimise procedures and spot errors and potential fraud.
Regulatory compliance is a business-critical area that benefits from better administrative efficiency. Digitisation reduces the need for manual, in-person identity verification for online services in insurance and healthcare.
Digital identity verification can be performed by cross-referencing user-submitted data with trusted data sources or analysing images of ID documents. These processes help insurance providers comply with data regulations such as the Health Insurance Portability and Accountability Act (HIPAA) in the US, protecting individuals’ medical records and other personal information. With identity verification and authentication, providers can prevent unauthorised access to insurance benefits, prescription drugs, government benefits or other financial gain
acquired through identity theft.
Better analytics and improved security. Machine learning can be used to analyse every aspect of claims and how they are handled. Optimisation becomes easy, and the prediction of problems and opportunities well in advance can improve how companies function.
Close monitoring of real-time metrics can also improve security. Whether it’s an individual fraudulent claim or large-scale organised fraud, digitisation makes problems simpler to spot.
What makes digitisation possible?
Concerns about data security and identity fraud are ever-present when an industry is digitising. Dealing with financial products like insurance raises the
stakes on those concerns even higher.
The data that insurers hold on their clients is highly detailed, making it extremely attractive to bad actors. However, advances in digital identity verification are making the digitisation of all kinds of financial products a more practical proposition.
Trulioo GlobalGateway is a leading identity verification solution that helps companies reduce exposure to fraud, meet compliance requirements and build trust with their customers. With automated workflows and end-to-end onboarding assistance, Trulioo enables companies to welcome real customers quickly and easily. GlobalGateway uses a layered approach to identity verification, giving access to multiple verification services and hundreds of data sources around the world through a single application programme interface (API).
Insurtech is a fast-moving industry, and companies need to be able to bring products to market quickly if they’re going to stay ahead of the competition. By partnering with a reliable and innovative identity verification provider like Trulioo, insurtech organisations can offer innovative new products with confidence, knowing that they and their customers will be protected from risk.