The Insurance sector is facing dynamic challenges such as changing customer needs, low retention rates, and disruption from InsurTech companies. Risks, such as distracted driving in the auto industry and the impact of extreme weather events, have increased the number of claims filed, and the number of interactions customers have with their insurer. Decreased satisfaction with those interactions and the cumbersome process of filing a claim are leading many people to frequently change providers. These short-term decisions, born from frustration and dissatisfaction, are hurting an industry that would greatly benefit from a long-term relationship with these customers.

Addressing these challenges involves creating solutions that drive high quality customer experiences, increased loyalty, generate new revenue, while simultaneously reducing costs. An emerging vision for the future of insurance is one where customers, and the customer experience, come first.

The challenge: Making the Market

Optimizing customer experience must be top of mind for insurers and core to their business strategy with driving long term success. Long hold times waiting to speak to an agent, bulky insurance application processes, insufficient customer understanding and insights, all lead to poor customer interactions. Rather than feeling supported and valued, customers feel frustrated and often turn to other providers.

These challenges present a significant opportunity to disrupt a static industry in need of a technology boost. Game-changing technologies like Cloud computing, Artificial Intelligence (AI), Machine Learning (ML), Blockchain, Internet of Things (IoT) and Big Data are driving digital transformation, enabling a wave of innovation and helping insurers meet new client expectations.

The solution: Gain Momentum by Competing with Technology

There are multiple use cases for disruptive technology that most companies can implement quickly and easily. Chatbots and data analytics demonstrate how emerging technologies can be leveraged to drive differentiation and competitive advantage.

Leverage AI and bots to transform customer engagement

AI powered chatbots can drastically improve customer onboarding and relationship management. Imagine the variety of touchpoints one person must interact with over the life of their insurance coverage. They start by researching providers online, but when they have further questions they need to pick up the phone and call an agent at a help desk or call center. This experience is tiresome and once the potential customer is ready to commit to a coverage plan, they still need to go through the application process. If an existing customer wants to change their plan or manage a claim, they need to speak to an agent accompanied by a wait time, and lengthy information gathering over the phone. This experience is not efficient, personal, or consistent. With the right technology, this disjointed type of customer service can be eliminated.

Now a potential customer investigates an insurer’s website, but instead of calling an agent, a chatbot powered by AI and Machine Learning can gather all necessary information and suggest relevant offerings quickly and seamlessly. If the application or claim is straightforward, it can be fully executed online without the customer ever having to talk to an agent. If the situation requires an agent’s expertise, the bot can consolidate all the information the customer has provided and smoothly transition the discussion to a human representative. The experience is seamless to the customer and processing time can be reduced from days to minutes.

Harness data & analytics to dramatically improve customer management

Agents need to have a fully consolidated view of their customer’s needs, insights into potential offers and risk predictions based on data analytics. Surprisingly, paper-based business processes still exist, and customer information is often fragmented across several core business systems. This makes it difficult to respond to customers quickly and assess opportunities to improve customer satisfaction and loyalty. Rather than rely on disconnected collections of information, Cloud computing can aggregate data and use advanced analytics to drive key insights.  The Cloud can integrate diverse sources such as core business systems, customer interactions, social channels, and mobile apps to create a more complete view of the customer. Analytics can then suggest relevant offerings, flag potential areas of risk, and improve customer satisfaction.

Bottom Line: Leverage technology’s full potential to transform customer experience

Innovative technology opens a wealth of opportunities to transform customer experience and relationship management. Most insurance companies have the necessary data to create fully functioning bots or Machine Learning solutions but need to put that data into action.

The potential of technology to transform the full customer experience is essential in the current marketplace. To attract, retain, and best serve its customers the insurance industry needs to implement agile tools and processes that put the customer first.

Now is the time to undertake a digital transformation. Insurance companies must approach this innovation opportunity in an agile way, driving a differentiated business strategy, while experimenting and leveraging these disruptive technologies – start small, iterate and prepare to support tomorrow’s customers.

For a deeper look at technology solutions specific to the insurance industry, explore Microsoft’s Perspectives on The Digital Insurer.