Mark Breading is a Partner at ReSource Pro Consulting.
Automation with a human in the loop
In the face of rapid change, growing competitive pressure, and increasing customer expectations, established insurance organizations—whether carriers, MGAs, retail agencies, or others—need to be more agile and efficient to succeed. This requires streamlining insurance operations in order to better support strategic growth initiatives. Two approaches to this challenge are outsourced business process management and robotic process automation (RPA) of internal processes. Which is better?
That’s a trick question, of course. Both outsourcing and automation offer insurance businesses the opportunity to reallocate time and resources currently spent on repetitive processes in favor of more strategic activity. It isn’t an all-or-nothing decision, either. Some straightforward business processes, such as accounts receivable, employee onboarding, and payments, can be automated. Meanwhile, more complex, insurance-specific ones, such as claims processing or underwriting complex risks, are best served by having a human in the loop.
“Automation-enabled business process management provides the best of both worlds: You outsource complex mission-critical processes to experienced professionals who are also equipped to maximize the value of RPA.“
“Insurers need to find ways to balance technology adoption with maintaining the human touch.”
What to consider before implementing automation
It’s easy to get excited about promising technologies and try to find use cases for them, but a better approach is to consider what you need to accomplish, then determine the best solution to achieve your goal. Are you looking to reduce operational expenses? Become more agile? Open new revenue streams? Which processes are creating the burden and how complex are they? Start from the business viewpoint first and then work out from there.
When considering making a significant change to your technology stack in the form of advanced automation, it’s critical to think about what capabilities you will need and what it will cost to acquire them. Does your organization have the expertise and resources to develop and maintain an automation solution? How will you integrate automation into your current operating procedures? Are your service operators prepared to work alongside developers to fine-tune, adapt, and update process orchestrations when necessary?
Remember that any change in procedures could disrupt the automations you have in place, and with insurance procedures changing up to seven times per month, these disruptions could become untenable. Bringing in developers to adjust RPA bots to meet these changes quickly becomes costly, time-consuming, and inefficient.
What about AI for insurance?
Artificial intelligence (AI) shows great promise in insurance RPA due to its ability to adapt to different situations and scenarios. However, AI requires massive volumes of data for model training to work properly.
Auto insurance is a prime use case for AI, as significant data is available in the form of accident reports, settlements, government statistics, and replacement costs, and there are a finite number of automobile models to cover. By contrast, with commercial property insurance, every property is different and every insured has their unique requirements. The data is simply not consistent enough to generalize in the way that AI requires. The problem becomes even more acute for specialty insurers.
The best insurance RPA solutions are built with industry knowledge
In order to create workable RPA solutions for insurance, your vendor must have industry knowledge to fully understand the processes they are automating. For example, they may not be able to know how to abstract certain inputs and tasks to future-proof the automation. Ask for insurance-specific case studies of their RPA solutions, and if possible, conduct a trial or proof-of-concept using your own inputs.
The right automation-enabled business process management partner has deep industry knowledge and expertise to draw upon when developing and updating automations. It is an organization built from the ground up to incorporate insurance and automation expertise across the entire service delivery lifecycle, integrating continuous process optimization to provide customers with lower costs and higher throughput without sacrificing quality or disrupting operations.
Your automation partner should have standardized processes at the human and bot level to make automation more efficient and effective. In addition, their service delivery unit should work closely with their automation team to develop and refine solutions tailored to the needs of their customers.
Automation-enabled business process management leverages RPA as a tool rather than a standalone solution. This effectively overcomes the limitations of a traditional approach to RPA to create scalable, cost-effective results that benefit customers. Automate or outsource? The real answer is to do both by finding an operations outsourcing partner with the right insurance and technical knowledge to give your organization the advantages of RPA without the upfront costs to build it and the ongoing expense of keeping it up to date.
ReSource Pro delivers integrated solutions, using people, process, and technology to meet the needs of insurance organizations. Our unique model of integrated automation seamlessly delivers scalable output on a complex process with constantly changing workloads so our clients can focus on what really matters: delivering innovative solutions and first-class service to customers.
Visit our business process management page to find out how ReSource Pro can support your agency throughout the complete policy lifecycle.