Intelligent automation in insurance: Where we are, and where we’re going

Intelligent automation in insurance

The pandemic has forced insurance organizations all over the globe to accelerate their digital transformation efforts. Intelligent automation in insurance business models is among the quickest ways to do so.

That might be even truer in insurance — an industry that tends to have a longer paper trail, yet relies on quick responses. A recent IDC Analyst Brief commissioned by Hyland and Duck Creek, Integrated and Intelligent Document Processing in General Insurance, found 42% of documents and files are unstructured or semi-structured. The global firm also estimates the percentage is “much higher in the insurance sector.”

To further complicate things, the file and document formats — from images to audio and video recordings — are growing in number.

For insurers, capturing and retrieving relevant information often is a job for intelligent automation (IA).

Smart solutions

Intelligent automation — the use of automation technologies and artificial intelligence that anticipates the needs of users and customers while reducing human touchpoints — can take on many forms. In insurance, an intelligent capture and management platform helps with capturing and categorizing documents, and relating the documents and content to each other.

Artificial intelligence (AI) and machine learning (ML) configure and identify data and document patterns. Information is indexed, and key information is extracted. A crucial step — one that, IDC notes, many insurers haven’t made — is an integrated and intelligent process automation system.

“Integrating document processing with insurance solutions provides a marriage between process activities and the documents they consume and produce at each step in the process,” IDC says in its August 2021 report. “Processes are more intelligent, and hence, activities and decisioning are more automated.”

The firm’s research has shown that 80% of insurers have manual interruptions for more than 40% of their claims cases. The reason: Document management workflows that aren’t integrated with insurers’ core business solutions.

An integrated approach, on the other hand, reduces claims processing times by an estimated 20–35%. That seamless exchange of data among your technology solutions results in faster payments to customers — which is as effective of a customer service tool as any.

The IDC Analyst Brief, commissioned by Hyland Duck Creek, shares the data on how integrating document management into core processes benefits general insurers.

Intelligent automation at work for insurance companies

More intelligent, more efficient and better for the customer — sounds great, right?

Well, these claims (and you thought the insurance commercials were amusing) aren’t too good to be true.

RPA eliminates lag time and engineers major savings for FDLIC

RPA in insurance: How Funeral Directors Life Insurance Company saved money and hours with RPA.

Funeral Directors Life Insurance Company had eight staffers who were responsible for settling more than 2,000 contracts each week. As claims picked up and new business accelerated, employees were staying past close to process contracts and reduce lag time.

Already users of OnBase, a Hyland content services platform, all it took the FDLIC team was a “Hack Week” and Hyland’s robotic process automation (RPA) solution to automate new business processing. During its five days of innovation and fun, FDLIC figured out how the Hyland RPA and OnBase integration could improve its processes.

Within a few weeks, FDLIC added five bots that were integrated with Hyland’s platform and automatically surfaced information to settle new business contracts. A month later, the company had an 88% return on its bot investment and a total elimination of lag time in line-of-business processing.

The bots allow the company’s workers to focus on building relationships with customers and producing quicker, more accurate outcomes. Implementing RPA meant FDLIC’s claims department began to save about seven minutes and $4.36 per claim. Also significant: The insurer saved 20,000 hours in manual processes and its claims volume increased by more than $15 million over a two-year period.

Top performers turn to AI and machine learning

Interest in AI and machine learning is as prevalent as an insurance spot during a football game. But effectively and intelligently capturing critical business information is as important to an insurer as a star quarterback is to an NFL team.

Organizations, AIIM says, can no longer “afford the luxury of manually identifying and categorizing incoming information.” AIIM’s report on intelligent capture, which includes a significant number of responses from insurers, recommends that organizations view AI and machine learning in two contexts.

The first is traditional: how the tools are being used and could be used to improve efficiency and gain insight.

The second is more complex: how the tools can be used to make information more understandable by the machines.

The latter, AIIM says, is “done by adding context to unstructured information — i.e., content.”

Top-performing companies, the association found, are pushing the envelope on AI and machine learning much more aggressively than average organizations. AIIM says the difference in the percentage of large-scale implementations of intelligent capture technologies between top performers and average organizations is “at least” 20 percentage points.

Automated underwriting

Underwriting, once a manual and paper-intensive process, is being transformed by business processing solutions. Insurers are using content services platforms (CSPs) embedded with intelligence capabilities to automate age requirements, detect signatures and perform important compliance tasks.

Deloitte’s 2021 insurance outlook cited greater use of automation, alternative data and AI as the top three changes insurers need to make in the underwriting process. The switch to intelligent automation in underwriting is in the early stages for many insurers, the global firm says.

Insurers that have made the switch, however, are realizing huge gains.

Deloitte’s research mentions a company that approved 96% of its policies through automated underwriting. Doing so reduced the company’s average turnaround time from 3.8 days to 10 minutes.

“The question is whether most insurers will invest enough to make this vision a reality, at least in the short term,” Deloitte’s outlook says.

Want more examples of intelligent automation? Read about what IA could look like at your organization.

How IA benefits insurers

What’s your first thought when you read or hear about intelligent automation in insurance? Does it have to do with human workers being replaced by bots?

The reality is intelligent automation empowers employees to focus on high-value tasks, which leads to increased job satisfaction and an improved customer experience.

Research has shown that intelligent automation can:

  • Save insurers thousands of hours in manual processing each year
  • Increase accuracy by at least 80%
  • Speed up service delivery time by as much as 80%
  • Help insurers achieve 100% regulatory compliance
  • Produce a 100% ROI within a year, with more gains to follow

Insurance workers today are focusing on emerging technologies, while gaining new skills and responsibilities. They are, in fact, more valuable than ever.

The future of automation in insurance

McKinsey, in researching the future role of artificial intelligence and intelligent automation in insurance, says purchasing insurance will be “faster, with less active involvement on the part of the insurer and the customer.”

By 2030, underwriting as we know it will no longer exist for most personal and small business products in life and property and casualty insurance. More than half of claims activities, meanwhile, will be replaced by automation, the global firm says.

To prepare for what’s ahead, McKinsey recommends that insurers:

  • Keep up with technologies and trends in AI
  • Develop and implement a “coherent strategic plan”
  • Create and execute a “comprehensive data strategy”
  • Develop an effective talent and technology infrastructure

The world has seen rapid advancements in technology. The speed of such advances, along with our reliance on intelligent automation, is only going to increase.

Is your organization ready? Hyland, a leading provider of content services with the ability to leverage the power of intelligent automation solutions, can help.

See how Hyland insurance customers have taken off with content services.

Jeff Hiegert

Jeff Hiegert

Jeff Hiegert is a senior customer advisor for the insurance industry at Hyland. His primary responsibility is to help Hyland’s insurance customers and prospects identify and achieve the most business... read more about: Jeff Hiegert