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3 Big Factors for Your P&C Insurance Digital Transformation

By Michelle Dennis 09.22.20 Businessman with protective gesture and car, family, life and health insurance icons. Insurance concept.

In the span of just a few months, digital transformation went from important to essential.

We’ve seen in the last five years how new technology-based players in the property and casualty (P&C) insurance space forced traditional insurers to play catchup. Earlier this year, we talked about how 2020 was the year to invest in digital transformation — and that’s become even more true.

This current environment has placed additional stress on consumers overall as they have to rely increasingly on low-touch and touchless options with their insurer. While P&C insurers have been ahead of the rest of the industry in adopting digital transformation strategies, as with many things, the global pandemic accelerated plans to address new challenges, remain competitive, and retain customers.

The time is now to invest in digital transformation in order to get (and keep) customers and continue to grow. The challenge will be to balance what’s already working with changing operations to become better. Here’s what P&C insurers need to consider as they embark on their digital transformation journey:

Why P&C insurance digital transformation matters

One of the key trends with highest potential impact for P&C insurers over the next three years is a focus on digital transformation of the customer experience, sales, and distribution, according to Ernst & Young.

And 63% of respondents to a survey of P&C insurers from Aite Group said that it was customer experience that drove their technology investment. That’s because customer expectations are changing across every industry, and insurers are no exception. Customers expect omni-channel solutions across mobile, web, chatbot, and call centers. They demand to be able to interact with their insurer anywhere, at any time, using the method that is most comfortable for their current situation. 

Chart showcasing survey respondents answer about P&C insurance digital transformation goals

P&C insurance digital transformation gives you the power to build a customer experience that works. And if you don’t? You’ll not just lose customers — you’ll lose the ability to compete in the first place, becoming less and less efficient. 

But digital transformation is complicated. P&C insurers need to think through and balance three factors:

  • Simplicity vs. Automation
  • Digital vs. Human Interactions
  • Short-term vs. Long-term Benefits

Let’s dig in and see what considerations should be made.

Simplicity vs. automation

Insurers can provide the optimum value to their customers by leveraging data and AI to streamline processes, specifically those that are related to servicing their customers. 

By gathering, analyzing and contextualizing customer data, insurers can demonstrate their understanding of the needs of the customers, while fostering meaningful dialogue and providing a customer experience that will set them apart. 

Think about it this way: if consumers today can order something on their phone and have it arrive at their house in one day (thanks Amazon!), then they’re going to expect that you can respond to their email and that you know they’re looking for car insurance, not home insurance.

Data provides a better, more productive interaction with customers as well as a more personalized experience, resulting in a key competitive advantage.

Digital vs. human interactions

The primary driver for digital transformation has historically been price competition. 

Focusing solely on price competition can result in limited success in an insurers transformation. Although consumers have been increasingly choosing digital channels for interactions with service providers of all types, including insurance, there is a need to balance the digital offerings with human interaction. 

We’ve seen that striking the balance between digital and human interactions is when insurers are the most successful in fully realizing the return on their investment. Developing a strategy that includes both short and long-term objectives addresses the balance necessary to retain customers and continue to grow in a challenging environment.

Short-term vs. long-term benefits

It’s no secret that every company is facing economic pressures with COVID-19. Businesses must be more particular about their choice to invest limited time, money, and energy. But it’s easy to overlook a key investment just because it won’t pay off until 2021.

P&C insurers need to look past quarter-to-quarter mindset and think about how it impacts the business overall. By thoughtfully investing in digital transformation, the long term impact isn’t just a better customer service experience for your customer, but for your employees — making it more efficient and easier to continue to delight your customers, increasing your customer lifetime value. 

If you don’t do this now, you’ll be left behind. Your customers want to interact with companies that provide them the option of getting service when they want it, where they want it, and how they want it. It’s what they expect. If you don’t do this now, they’ll find a company that will.

It’s time to invest in technology

As we look at the challenges facing P&C insurers, there are encouraging signs. While there is continued pressure in the industry, we see insurance companies investing in technology during this time and looking to Silverline to support them in these initiatives. 

Take Privilege Underwriters Reciprocal Exchange (PURE), a policyholder-owned insurer that offers customizable coverage throughout the U.S for high-value homes, automobiles, jewelry, art, personal umbrella liability, watercraft, and flood. 

They built a secure private member portal to provide members with online access to vital services and information, all from one location, investing in a digital transformation to build the best possible customer experience.

“Silverline really embraced our vision for our member portal,” said Stuart Tainsky, Senior Vice President & Chief Information Officer at PURE. “We collaborated to ensure we had the best member experience possible. Because of this, our portal is more intuitive, responsive, and connected to our business processes than anything we could have imagined.”

Silverline’s approach to P&C insurance digital transformation

Silverline leverages our extensive experience in the industry to build strategies that achieve P&C insurer objectives — in PURE’s case, raising their NPS score 6 points in just one year. Our focus is on using technology to not only improve a customer’s experience but also support customer-facing resources by providing the technology tools needed to effectively and efficiently service customers. 

Learn more about how we can help you on your digital transformation journey.

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