Digital Service Trends to Watch in the Insurance Industry in 2021

The following post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga.

The insurance industry, traditionally conservative and resistant to change, is now seeing major innovation within the field, especially over the last year. Insurance is finally leveraging technology to forge ahead and open itself to transformation. These effects are seen in upgrades to offerings, services, interaction with clients and security. 

Traditionally, companies using strategies that mean long process times, paperwork and coverage ambiguity are finally adjusting to the market demand for transparency, instant gratification, and accessibility. 

Insurance companies are already undergoing a digital transformation in recent years. They have accelerated their online and digital initiatives to address the current global challenges and their clientele's needs and demands.

These are some of the 2021 digital service trends in the insurance field, transforming how insurance companies are striving to operate.

Tailored digital services and products

Insurance companies are moving into the new digital era, which is not a simple feat for legacy service providers. Aside from going digital, as all reputable industries and companies are doing, insurance companies must remain competitive by offering innovative products. 

Personalization capabilities offering a particular client a particular product at a particular price can increase conversion and strengthen the brand's reputation. 

Companies are offering policy options based on lifestyles, an inquirer's preference and needs. In addition, carefully constructed detailed questionnaires and analysis via proprietary technology and the insight of human perspective reveal optimal outcomes when pairing specific policies with the specific insurance coverage requested. 

These tailored products explore different facets affecting the well-being and health of their audience:

• Physical health: Insurers, like Sproutt online insurance, are promoting better health habits to encourage customers to care for themselves and their families.
• Mental health: Studies have shown that mental health has a direct link to overall health. Questions about mental health are common today on insurance questionnaires. 
• Exercise: Adequate movement into one's daily or weekly routine has proven to improve overall health and mental well-being. Insurance applicants who share this information on their insurance applications may receive a better variety of policies with lower prices. 
• Diet: Maintaining a balanced diet is key to maintaining a healthy weight and may reverse chronic health conditions. Insurers look favorably upon this when reviewing insurance applications.  
• Sleep - Recent research has proven the amount and quality of sleep each person gets directly affects their daily functionally, energy, mental health, and longevity. 

Artificial Intelligence is Key

Insurers can automate many facets of the insurance process via artificial intelligence, or AI. This trend may affect all aspects of the insurance industry soon. Risk assessment, fraud detection, underwriting and personalization are but a few of the major areas in which AI and deep learning algorithms are helping insurance providers deliver more accurate and efficient products or coverage to their customers. 

 From improving the flow of processing claims, processing speed, and calculating risk, insurers can expect their claims cycles to shorten and become more accurate as the element of human error is cut out. Using artificial intelligence is said to be a major player in the seismic insurance industry shift from 'paying for damage' to 'preventing damage.' 

Digital Channels Replace Physical Channels

Insurance has historically been an industry that relies on face-to-face meetings. It’s most major advancement until recently was the introduction of phone calls via call centers. But now, insurance is adopting a heavy online presence and virtual interaction channels. Customer demand is shifting to personal online research and independent decision making -- they don’t need hand-holding from an agent. 

Potential clients expect the opportunity to review and understand their options, the process, prices and detailed service agreements online, all aggregated in a single location for side-by-side comparison. This is a positive for insurers as this frequently leads to quick client conversion -- instead of those requiring follow-up phone calls or more offline interaction as in the past.

The space of digital channels has made legacy processes nearly obsolete. What used to be the norm for the insurance industry - inefficient paperwork and physical forms being filled out by hand and saved in manilla folders - moved on to e-signatures and digital forms from account opening to policy renewals. 

Companies like Sproutt online insurance have revolutionized the life insurance space by allowing those seeking coverage to select it based on their needs and capabilities, all online in one place from a range of life insurance carriers. Once answering a few questions, each applicant is presented with a variety of policies, apply, and receive an answer within minutes. This is a true self-service digital channel.

Sales Funnels and Conversions

It is not enough to go digital. What leads companies is the bottom line - improving sales funnels via these digital channels and maximizing conversations. The ability to convert online inquiries to actual insurance policy sales is a must. And it’s a skillset that requires talent outside of traditional insurance industry roles.

Life insurance carriers who understand the need for this skill are now investing in talent they did not have or need previously, like marketing strategists and technical SEOs, as well as deploying affiliate marketing programs and other strategies to increase online conversions. 

Data Security is Essential

The customer information insurance carriers hold and have access to is highly sensitive -- and often susceptible to cyber-attacks and other online threats. An industry driven by trust between carriers, agents and customers regarding health or wealth cannot afford any breaches in their system and processes. 

Exposing customer data in a breach is unfortunately always a risk, especially now that companies are transitioning to online platforms involving frequent updates and upgrades. 

To make matters worse, as the digital systems insurance carriers evolve, so do the attackers. And even a single attack can endanger customers and severely impact a brand's reputation.

Insurance carriers need to protect their data with automated periodic security audits, encryption and backup.

• A crucial step towards data protection is being familiar with the data flow - where it is going and where it is being stored. 
• Recognizing and scanning vulnerable points in the process allows companies to take measures to protect them. 
• Encryption has become an essential step to protect company data as it tackles the vulnerabilities of individuals being constantly on the move or today, more than ever, working from home opening up their devices to unsafe environments or ones that are far from the company's network. 
• A key strategy to data protection is to download the data protection tools into the cloud or limit the type of data stored there. 
• If data is stored or moved through the cloud, the company can opt for encryption of sensitive data before its transfer.

Mobile Apps are a Must-Have

We are solidly in a digital era and customer behavior reflects this. People are on the move constantly and always tuned in to their phones and other internet-capable devices. Customers of any brand want and need to access their information at all times with ease, and companies must deliver to stay on top. 

 This means mobile-friendly applications and websites are a must. Mobile apps for insurance allow insurance applicants, or those already covered, to have 24/7 access to their insurance policies and coverage. It also makes it easier to access customer location as a key factor in the policy’s premium range which is a bonus for insurance underwriters.

A well-designed mobile is not only capable of  accessing data from anywhere, at any time, but it should also offer an engaging interface and personalized experiences. Companies need to ensure that their app's parameters, like performance and speed, security and compatibility run flawlessly. Mobile apps are the single touch-point with users and clients, forcing companies to create strategies for an app-exclusive future. 

Bringing Insurance into the Future

Tech trends that improve existing services and transform industries are being adopted worldwide by insurance providers to improve the offerings, communication and bottom lines that mark this field. 

Whether large or small, entities in this space are partnering with technology providers to become and stay updated based on the market demand and expectations. These advanced tech solutions are beneficial for both the insurer and their customers.

And as for the ever-important bottom line, the modernization of the insurance industry will reduce operational costs by addressing fraud while employing automation to improve processes and ultimately, customer satisfaction. 

The preceding post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. This content is for informational purposes only and not intended to be investing advice.