Digital Transformation Is Just One Path to Efficiency and Growth
Insurance companies today face a host of challenges, from economic pressures to climate change, talent acquisition and retention, and evolving customer preferences.
To navigate these issues and improve profitability, insurers are looking to new technologies and emerging data sources to expand their capabilities and bolster efficiency. According to recent ReSource Pro Consulting research, 100% of commercial insurers are in some stage of their digital transformations this year, yet many have realized they are not as far along in their journey as they first thought.
As insurers continue their transformations, they should also explore other pathways that will enable them to evolve into a carrier of choice, stay competitive, and pursue growth. Business process management (BPM), also known as business process outsourcing (BPO), is one solution that can help insurers improve productivity, service effectiveness, and customer satisfaction.
What is BPM?
Put simply, leveraging BPM means working with an external partner to delegate time-consuming tasks out of the company, typically with the goal of increasing efficiency, maximizing internal resources, and ultimately boosting profitability.
What services are provided by BPM companies?
BPM partners can provide support for a wide variety of business activities, whether core—those that directly make money, or non-core—those peripheral tasks that are necessary to doing business but not central to success. For an insurer, this may include activities such as:
- The submission-to-issue process
- Claims handling
- Underwriting
- Accounting
- Quality assurance
The Case for BPM
Many think of utilizing BPM as simply handing off tasks to reduce costs, but best-in-class BPM partners can do much more. Rather than simply playing a passive support role, the best BPM partners help insurers better align their operations with their business goals, boost accuracy and efficiency through process improvement, and increase their focus on customer relationships and revenue growth. BPM partners do this in three ways:
Getting the right work to the right employees
Employees are often required to complete a range of tasks that are necessary to running the business, but which do not generate value for clients nor align with the skills of the employee. The growing talent crisis has only exacerbated this issue, with employees often being called upon to support tasks that fall outside their typical responsibilities. When insurers delegate these low-value tasks to a BPM partner, they can focus on getting the right work to the right employees, helping them stay engaged and productive while driving greater results for the business.
Optimizing processes for accuracy and efficiency
The best BPM partners aren’t just proficient in insurance processes and best practices but are also versed in process improvement methodologies, such as Lean and Six Sigma. This enables them to assist insurers in identifying areas of their business that can be capitalized upon or improved. BPM partners can then work with insurers to help develop more efficient processes or introduce standardization, eliminating wasteful activity and mitigating the risk of errors.
Implementing the necessary tools and technology
To maintain a competitive advantage, insurers need the right tools and technology to support their staff and fulfill their customers’ needs. That means deploying automation, upgrading from legacy systems, and leveraging data analytics. Each of these comes with its own set of challenges that can be difficult for insurers to overcome without disruption to their staff and customers. Working with the right BPM partner can equip insurers with the experts needed to implement these tools and changes while avoiding the headaches.
Benefits of BPM in Insurance
Strategically involving a BPM partner can open the door to a more profitable future. More than outsourcing, this approach is more of an optimization of operations or an evolution. BPM helps insurance companies in a few important ways. By delegating time-consuming tasks out of the company, insurers can:
- Boost Retention: Outsourcing can improve job satisfaction and retention since it reduces the pressure on staff by helping to eliminate backlogs and routine or tedious work. This brings benefits for the customer too, as it allows employees to spend more time focused on meeting their needs.
- Improve Operational Efficiency: BPM enables insurers to provide their teams with extra support when they need it. Many best-in-class BPM partners seek ways to improve the efficiency of the processes, leveraging Lean methodology and applying best practices.
- Reduce Errors: Many errors come from insurance staff who are dealing with backlogs and heavy workloads and may not have the time or energy to perform the work as accurately as possible. BPM can address this issue by increasing capacity. They can also help to standardize the associated process(es) to reduce errors.
- Introduce Cost Savings: Utilizing BPM can reduce the volume of work for an insurer’s employees, minimizing overtime and other unnecessary expenses. In some cases, the savings are great enough that they can be passed along to the customer, helping improve retention.
- Incorporate Automation: BPM partners can help insurers take advantage of automation technology while avoiding the large development and maintenance cost or the need to train staff to use the tools. They do this by blending automation capabilities into the workflow of their service delivery teams.
- Comply with Changing Regulations: Some BPM providers can help insurers navigate regulatory complexity, highlight what changes need to happen for the company to be compliant, and standardize their processes to meet those regulatory requirements effectively.
Best-in-Class BPM
The best BPM partners empower legacy and traditional insurers with a well-oiled robotic process automation machine, efficient handling of low-value tasks, and the ability to plug in new digital pathways and service channels. These process improvements make BPM-powered insurance companies more competitive, even against tech-savvy insurance startups.
ReSource Pro offers specialized BPM solutions that empower insurance providers to streamline their business processes. Contact us to learn how our outsourcing solutions and productivity platform can help you succeed.