If the global COVID-19 pandemic did one thing, it revealed digital shortcomings in several industries, and it accelerated changes that were already overdue. The property and casualty insurance industry was no exception, and as the pandemic recedes, adapting to those changes is the key to rapidly rebounding to a “new normal.” But what does that look like, and what are the changes ahead for property and casualty insurance policy administration?
New Customer Enrollments
As things return to normal, property owners now have to take new things into account. There is a housing boom, and more people are becoming homeowners, changing homes, and home values have spiked across several markets.
There are other booms as well, ones that directly influence insurance policy administration. Used car sales and values are also on the rise, and cars once used for commuting are now used for leisure. In some cases, a return to the office means cars are being driven more often and further than they were before.
While the full surge insurers expect to see is not here yet, now is the time to prepare.
Policy Changes
Not only will there be new enrollments spurred by changing customer needs, but insurers must prepare for the fact that policy changes will surge as well as businesses reassess liability, reopen offices previously shuttered, and as business increases at restaurants and retail stores.
On another front, large numbers of baby boomers have shifted from homeownership to renting. This creates customer retention issues unless the insurer can work with them through these changes. Millennials are also moving toward the rental market for a more “hands-free” housing lifestyle according to CNBC.
Other changes will also come from evolving technology. Insurers must be ready for electric vehicles, the move to renewable energy to power homes, and the risks that come with those changes.
With more Millennials and Boomers working from home, both embracing emerging technology and shifting where and how they work, their insurance needs change as well, and that means insurance policy administration faces additional challenges as well.
The Hybrid Workspace and Liability
The rise of the hybrid workspace means a few different things to insurers. The first is that workers compensation claims may not return to pre-pandemic levels for some time. The risks involved with hybrid work are dealt with in an entirely different way, and while physical risk may be lower, digital risks like compromised data, ransomware attacks, and others are higher.
This has caused businesses to rethink liability and what that looks like. There’s also the balance between covering business equipment used in an employee’s home office and any work-related accidents that might occur there when compared with covering work-related accidents in office environments very much under the company’s control.
Not only are businesses rethinking their liability insurance during this transition, but workers are as well. In some cases, homeowner’s policy must be reviewed and revised to ensure they provide the needed coverage.
For insurers, this creates a double challenge and a double opportunity. Both homeowners and business policies must be structured for the right coverage at the right time and with the proper definition of terms and restrictions.
But what is the best way to handle all of these changes, and the new work and opportunities created?
A.I. and Claims Processing Automation
At the same time all of these things are happening, insurance departments at businesses are changing too. Small departments have become the rule rather than the exception. And with remote work changing the insurance industry as well, insurers need to be more efficient than ever.
One of the easiest ways to do this is to go digital. Automating workflows saves time, money, and energy. But there is another upside. Automation allows the customer to control their experience in a more meaningful way. From filing claims to making policy changes, everything can be done quickly and easily online. For insurers, advantages include:
- Low touch claims processing that can be almost completely automated
- Automated workflows that improve efficiency and accuracy throughout the lifecycle of the claim, including evaluating documentation, collecting data, and even evaluating the validity of claims.
- Processing claim payouts digitally. This makes payments more secure, removes friction from the process for both the insurer and the insured, and creates equity through automation.
Going digital enables insurers to meet the challenges facing the industry head-on, embracing new and better processes, and making themselves more competitive in the market at the same time.
Embracing Today's Digital World
It’s a digital world, and more and more companies are embracing the use of technology, Artificial Intelligence, and automation to work more efficiently, provide a better customer experience, and make themselves more competitive in a modern and changing market.
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