Insurance companies were among the earliest adopters of the first wave of digital transformation - simply because their whole business is processing information from documents. Erwin Schwarzl, a senior executive at TCG Process, outlines why some of the world’s largest insurers have adopted TCG Process DocProStar as a flexible Digital Assembly Line to efficiently deal with the demanding processing requirements of the insurance business.

Though the need for process automation can be similar in large organizations, there are unique challenges insurance companies face. What are those factors that drive the importance of automation in this industry?

Insurance companies are among some of the biggest business-to-consumer companies in the world. If you have lots of clients, you have lots of communication. These clients interact with you in whatever way they feel like: paper, fax, email, social media, chat tools, … and they still call. But no matter how they send in the information, the data must be processed the same way with the same rules and regulations. Customers expect their insurance company to be up to date on all communication when the insured calls, texts or emails. Insurance companies can no longer say “it’ll take a week until I can review that communication or document”… they need access to all incoming information very quickly.

Even with all of this customer communication, many insurance companies still leverage antiquated, poorly-integrated legacy systems to manage client dossiers and risk. Often customer documents provide information which is key to regulatory compliance and proper risk assessment. A lag in processing time, however, can dull the customer experience and mean a competitor garners the sale.

And this isn’t a one-time customer communication event. There are multiple correspondence points throughout the customer lifecycle in insurance. Some types of insurance require annual paperwork, regardless of whether or not a claim is ever filed.

Additionally, fraud prevention is a huge goal for all insurers, on both the claims and sales sides of the business. This is often why a client finds the TCG platform to be a good fit: Based on the client’s business rules, TCG can enable fact-checking processes, helping companies to automatically identify suspicious networks and parties conspiring to maximize insurance claim payouts.

Which day-to-day insurance operations and processes are typically still the most manual and in need of automation?

No matter the type of insurance provider, you always have these two parallel, but equally complex, processes running daily: sales and claims. Often, both have processes in need of automation. By far the most manual processing challenge facing insurance companies today is the claims process.

The number one challenge in claims is document logistics; you must ensure all documents that belong to a case come together for the claim to be processed.

To take it a step further, in addition to collecting and securing documents, insurance companies work hard on fraud prevention. The content on the document must be validated.

And when these manual processes encounter a seasonal or unexpected spike in incoming documents, as is the case when we experience natural disasters like hurricanes or fires, the need for automation becomes even more obvious.

What is the typical entry point to automation? Is there a process in insurance that is the most common for customers to start with? Or does it just depend on what has the most internal value?

It really depends where the pain is the biggest. Many of these companies already have some type of document management solution in place today … but older solutions struggle to keep up with the need to be flexible and respond to changing requirements. Therefore, sometimes the entry point is a semi-automated process that the customer knows could be improved.

Also, as I mentioned before, insurance companies regularly run into workload challenges and this could be the process that drives the initial deployment. Insurance is a seasonal business. In Europe, automotive insurers renew all policies at the end of the year; the same can be said for US health insurance plans’ open enrolment period.

This means that in the months of November, December and January these companies are dealing with much higher incoming communication load per day. Without automation, you need more people who must be trained in order to follow the proper processes, and to ensure an excellent customer experience. Our solution automates the process, rules, and validations which then lowers the need for seasonal personnel while remaining compliant with risk assessment and company policy.

ROI is always part of the discussion as to what comes next: Are we losing insurance customers because of turnaround time? Which process is very costly, if we move it how much money will we save in labour or IT infrastructure cost, for example?

When we can, we advise customers not to tackle the largest and most complex process challenge initially. The best practice is to start with something a bit simpler in order to build the organization’s experience with the TCG platform. This helps our team understand the systems landscape and technologies, and together we determine how to best fit them together.

Sometimes, however, this is not possible, and they decide to jump in with both feet. At this point, we help them to break the project down into measurable pieces, or phases. This allows you to see ROI at every checkpoint and offers measurable results for the length of the project.

How has the move to the cloud impacted the insurance market?

The cloud has allowed insurers to reduce IT infrastructure costs. I mentioned the seasonal nature of the business ... With cloud infrastructure, insurance companies can turn around an enormous number of documents during peak processing times without having the hardware needed for that kind of speed sitting around for the low volume months. IT can scale up services to accommodate exactly what is needed, when it is needed.

It also offers the insurance organization the opportunity to outsource management of the automation tool. This often will lead to quicker deployments, which means a quicker ROI. IT no longer needs to spend time setting up resources and infrastructure in advance of project kickoff. 

What do you think is the next major trend in business process automation that people should be paying attention to today?

I’d have to say the most interesting trend for our market is those that offer gains in contextual or semantic understanding.

And this is important, because there are not enough people around to do this manual work. Why should you have people that type data from a sheet of paper into a computer - or from one window of a computer into another?

It addresses the ongoing, global need for data privacy as well. When we incorporate predictive technologies like AI and bots with traditional tech like character recognition in a process automation platform, we limit human interaction with sensitive data. And this is key to keeping your data yours.

What type of insurance companies have you worked with on document and data process automation?

So many different types depending on where I was in the world! I’ve worked with the very large, BlueCross BlueShield-style insurance companies in the US, down to small providers, like the composite insurers here in Europe (most of whom have consolidated into big organizations). Today, we work with composite insurers, government-regulated public health insurance, and private health insurance alike.

Our first TCG Germany project focused on insurance contract documentation. We entered into a huge project with a large, international life insurance company; they wanted to create a digital process for agents selling financial products.

Of course, a huge benefit was the ease of document and information logistics, but the emotional driver for the organization was employee compensation. Because many insurance agents are brokers, it’s important for them to see how productive they have been; this is their livelihood. If an insurance company takes two months to deliver earnings information, it can mean decreased motivation and sales impact for important brokers.

https://www.tcgprocess.com/en-en/contact/tcg-australia/

What are the essential ingredients of Capture 2.0?

The teaming of advanced machine learning technologies with traditional OCR and Robotic Process Automation (RPA), is providing new possibilities for organisations overwhelmed with processing a digital deluge of messages and documents. Frank Volckmar, Managing Director of TCG Australia and New Zealand, believes the possibilities unleashed by these new cutting-edge technologies have unleashed a new paradigm, variously described as ‘Hyperautomation’ or ‘Capture 2.0’.