Mobile Solutions: Helping Savvy Insurers Improve Profitability
Let’s face it. Insurance companies aren’t known for enthusiastically embracing new technologies. In the face of ever-changing regulatory requirements, an unstable economy and a more demanding consumer base, convincing an insurance CFO to invest in new technology solutions presents a formidable challenge for even a seasoned negotiator.
Savvy insurers will realize, however, that survival and success depends largely on their willingness to innovate. One such innovation whose time has come in insurance is mobile solutions; in fact, according to the Consumer Electronics Association (CEA), the market for tablet PCs grew 207 percent in 2011 while smartphones grew by 63 percent. Mobile solutions are key components of any growth strategy…and we’re not talking about passing Blackberries out to employees and agents.
A Simple Equation
Insurance companies have to do a better job of managing risk, controlling expense, creating new products and attracting profitable customers. Mobile solutions are an integral part of achieving these initiatives. They help improve profitability through top-line enhancement and cost containment and help save money, mitigate risk, and increase productivity. Mobile solutions can also attract new customers, retain current policyholders and help insurers tap into new markets with new products.
In addition to shedding risky customers, forward-thinking insurers proactively retain and attract the most profitable policyholders. In today’s competitive marketplace, this requires the insurer to empower its field force and agent producers with the tools to capture business at/or near the point of sale. By extending capabilities to mobile devices, insurers augment and support existing lifecycle processes, from new business/underwriting to claims. With anywhere, anytime access to visual representations (illustrations, loss control, damage estimation) or forms-based and repeatable applications (application submissions, loss reports), staff keep processes moving – whether online or offline.
Key revenue advantages gained from mobile solutions include:
- Shortens cycle times for new business capture
- Speeds information sharing and better visibility into processes
- Improves attraction and retention of next-generation agent producers
- Reduces costs and time associated with completing and signing paper-based documents
- Minimizes the risk of information being lost or improperly entered into other systems
- Strengthens brand value
Cost containment is a key driver for an insurer’s business strategy regardless of the unknown long-term effects today’s downturned economic conditions and increased government regulations may have. But, a sustained, sluggish economy creates apprehensive consumers. And, while softening prices – either directly or through discounted bundling – have been somewhat successful in minimizing policyholder fears they’ve resulted in declining revenues and are unsustainable in the long run. Unprecedented levels of government-imposed legislation and regulations impact profitability as well, with insurers continually facing an evolving host of legal requirements from state insurance boards as well as federal oversight. Given this reality, in order to maintain profitability, insurers must focus on increasing operational efficiencies and decreasing expenses.
Mobile technologies provide real opportunities for cost containment, including:
- Improved response rates achieved though instant access to forms, loss notices or documents
- Increased effectiveness by eliminating redundant tasks, as evidence such as photos, videos, voice recordings, diagrams or signed documents are captured onsite and uploaded to the system
- Decreased time and risks around transferring information from the field to the underwriter or the home office
- Reduced dependence on expensive air/wireless cards due to the ability to work offline
While the insurance sector has historically been conservative in adopting new technology, mobile technology seems ideally positioned to help today’s insurers establish a competitive advantage. By implementing mobile technologies to address two major challenges – controlling costs and attracting profitable customers to increase revenues – will position insurers to succeed in a highly-demanding, evolving industry.