Empowering Insurance Industry Using RPA

Robotics-process-automation

“The relationship between technology and people has to change in the future for the better, and I think RPA is one of the great tools to enable that change”.

Leslie Willcocks, professor of technology, work, and globalization at the London School of Economics

The performance of any insurance company is heavily dependent on the efficiency of its back-office operations. From processing claims to providing policy quotes, from the customer onboarding to underwriting there are a great number of interlinked, repetitive manual tasks in the insurance business. In such a scenario, insurance companies need to identify and automate the processes with an excessive manual activity that hinders the overall efficiency of the process.

To start with, let us first examine the key processes in any insurance company. 

•     Customer Claims – This is an information-intensive process that involves administrative, managerial, legal, and customer inputs to guard the company against insurance fraud while providing quality service to genuine claims. Traditional processes rely heavily on manual data entry and claim validation leading to inconsistency and errors which ultimately affect customer satisfaction.

•     Customer Onboarding and New Policy Issuance – Acquiring a new client requires a certain amount of documentation and validation, collection of information from multiple sources, and involves a workflow approval process which when done manually consumes a lot of time. Additionally, these manual activities can be tedious, repetitive, and error-prone.

•     Underwriting – The risk assessment of insuring an individual, a vehicle, a business, or home is known as underwriting. The profitability of providing the insurance is determined and quote adjustments if any are done during this process. This requires experienced and skilled professionals who identify the risks underlying the policies. However, underwriters are often overburdened and buried in the paperwork, thanks again to the repetitive manual tasks!

•     Collaboration – Multiple third-party agents, companies, and clients spread across different geographical locations need to share, receive, document, and process relevant information on a day-to-day basis. Lack of integration of the systems hampers productivity.

The next question then is what companies can do to eliminate these repetitive manual tasks and drive away the inefficiencies to boost the business performance? Robotic Process Automation to the Rescue!

Robotic Process Automation (RPA)

The main aim of Robotic Process Automation (RPA) is to let humans focus on what they do the best and leave the rest to the machines. RPA tools can help companies to configure ‘robots’ that can interpret business transactions, perform data operations, trigger system response, and communicate with internal and external systems. Guided by the core business logic and structured inputs, RPA helps businesses to perform a wide variety of repetitive tasks without manual intervention, with great accuracy, and without being bored or tired! Particularly in information and manual-intensive businesses like insurance, RPA has become the go-to choice to smoothen the process and remove the inefficiencies.

RPA Implementation Process

RPA implementation should ideally start with these basic questions – Where is the majority of the workforce is being employed? What is the impact on time and cost for business? Can these activities be automated? Once the business has answers to these questions, they can choose any one of the approaches – a Top-Down Approach – In this approach, top management sets the automation targets for individual departments, and based on these targets further action takes place. A Bottom-Up Approach – In this approach the request to RPA comes from the departments based on their observations and need while performing day-to-day business activities. Irrespective of the approach the implementation process remains the same.

  1. Sniff Test – In this step, the primary assessment related to the process is carried out. The percentage of the volume of effort that can be saved in terms of Full-Time Equivalent is estimated in this step.
  2. Deep Dive – In this step the business processes are understood and analyzed in detail. The development team interacts with business users to gain insights into the activities and desired business logic. Every step is thoroughly scrutinized to identify the scope for automation. During this step, Business Intelligence can be of great help to document the data related to the process.
  3. Development –Based on the observations made in the previous step, the development team creates the solution to augment the performance of the existing process. A keystroke level documentation is done during this phase.
  4. Testing –The testing team checks the proposed solution for any inconsistencies, bugs, and deviations and sends the feedback to the development team.
  5. Pilot – A fully functional pilot which emulates the performance of the full-scale solution is released to business users and their feedback is collected in this step. Enhancements if any are done and final documentation is completed.
  6. Final Implementation – A full-scale implementation of the solution, user training, and post-implementation support is carried out in this step.

Measuring the RPA Performance

After implementation, it is vital for the business to not only monitor the solution but also measure the impact of the solution on the business. Below are some key measures of RPA performance:

•     Head Count – The reduction in the total headcount or total effort in terms of Full-Time Equivalent before and after implementation of RPA. This is often the easiest to measure as it directly impacts the overall cost of the business.

•     Accuracy – The reduction in the manual/system errors related to individual activities, documentation, and validation before and after implementation of RPA.

•     Turn Around Time –The service levels, response times, customer attrition, and customer satisfaction before and after implementation of RPA.

•     Cost – The overall process costs before and after the implementation of RPA.

•     Percentage of Automation – The amount of automation achieved against the planned level of automation.

Common Pitfalls in RPA Implementation

•     Missing the Low Hanging Fruits – Most businesses make the mistake of focusing on the most complex processes first and neglect the processes which can easily be automated. Starting with simpler processes helps businesses to gain confidence and knowledge to tackle many complex problems later on. This is also a financially viable approach.

•     Broken Systems – For RPA to be successful it is vital for businesses to have a seamless integration of all the internal and external users in their processes. Often, insurance companies face the issues of broken systems and fragmented information due to incongruent business strategies, discontinuity in business decisions, and changes in top management.

•     Bulky Implementation – No process can be completely automated in one go. Businesses make the mistake of choosing a bulky implementation approach instead of an agile approach which results in fragmented implementation. A phased implementation approach is best suitable for large projects to maintain control over costs, quality, and time.

Top 3 Demotivating Factors Organization Have About RPA

It’s quite tough to outline the top 3 challenges, However, based on our experiences following are the top 3 challenges that can be an obstacle in your RPA Journey.
•  Acceptance from the existing staff members because of fear of losing their jobs.
•  Failing to understand key business drivers before starting RPA Journey.
•  Lack of clarity as to which segment of the Journey to start from and how much to invest in both current development and future maintenance of the RPA systems- from both People and technology perspectives.

Top 3 Motivating Factors Organizations Have About RPA

•  Makes your job easier as you have a digital workforce available at your disposal.
•  Works in tandem with Human availability i.e. 24/7
•  Utilization of Human workflow in other creative and meaningful jobs. i.e. product design, service design, customer service improvements.

How to start and not stop at the end of this article piece?

I would recommend starting simply by just taking this approach, which has negligible risk, simple and yet an amazingly effective positive step towards our goal of a proactive strategy

A) Take pen -paper or manual method (start now)

Start identifying key repetitive and high accuracy business processes and educate the users. Indeed, this causes efforts, but this will pave the way for better clarity around unknown risks.RPA Expert, RPA Expert Australia, RPA Expert Sydney, RPA Agency, RPA Agency Australia, RPA Agency Sydney

B) Take help from technology

Work towards making it unattended, assisted by using Super-fast digital solution such that it works autonomously without losing its efficacy by engaging a solid, affordable Business and Technology solution partner. Aurion has already built and implemented many RPA solutions catering to different business needs across verticals.

If you are a CEO/COO/CIO/Managing Director/General Manager who is spending more time in reactive/preventive mode than future-facing, please reach out for an exploratory conversation.

Our Contact details

Pradeep Mishra (Director and Co-founder)

pradeep.mishra@aurionsystems.com.au

Ashok Mulchandani (Partner – Business Success and Strategic Transformation)

ashok.mulchandani@aurionsystems.com.au

Please feel free to leave your suggestions and thoughts in the comment box below!