Digital transformation: companies in the insurance sector

The insurance sector, like most sectors of the economy, faces the challenge of digital transformation:

Companies of all kinds must adapt to new habits and customer preferences, as well as the emergence of new purely digital competitors such as insurtech, are a threat to the industry .

For this reason, the digital transformation of the entire company is necessary, from the onboarding processes and development of the relationship with clients, through marketing activities and commercial management, including the areas of service and customer care. The entities are betting on ambitious digitization strategies and they do so based on the strengths that they have already developed, such as multiple distribution and service channels, large customer bases and a strong commercial system.

What is and what is not digital transformation?

The term digital transformation does not refer to being present on social networks, carrying out digital marketing actions, having an online store or computerizing company information, nor is it even having a CRM.

The digital transformation of the company is linked to its restructuring at the technological level: it means taking advantage of the opportunities that technology makes available to businesses, large and small. Thus, digital transformation involves terms such as the following:

  • big data
  • internet of things or internet of things (IoT)
  • social business or social business
  • cloud
  • mobility

Advantages of the digital transformation of the company

A recent study on digital transformation collects a revealing data: companies that take the step to digitization see their sales increased by 39%. Given this data, it is easy to conclude that technology allows, on the one hand, to improve the user’s experience with the brand and, on the other, to improve company processes. These are some of the advantages of digital transformation:

An innovative company with better internal communication

The fact of having specialized software, as well as qualified personnel in the digitization of the organization generates a “culture” of innovation within the company.

Likewise, it should be remembered that digital transformation entails a better interrelation between departments, as well as more fluid communication. This occurs because the organization goes through a process of organizational change, starting with breaking silos and improving communication fluency.

New customer experiences mean better sales

The fact that customers have new experiences related to brands increases sales. One of the key points about the user experience (UX) is the integration of the smartphone as the main communication channel with the customer.

Taking advantage of ‘big data’

A company cannot enjoy the benefits of using big data thanks to data analysis without going through digitization and employing data science techniques .

A golden opportunity to gain a foothold in the market

Entering the digital transformation allows, on the one hand, to create a difference with respect to the competition. This makes the digitized business find a privileged place in the market. On the other hand, this digitization has a greater capacity to adapt to changes and market trends, we could even say that in real time.

Company digital transformation: fundamental aspects

Cognodata has recently presented a study, carried out together with the main entities of the Spanish insurance and banking insurance sector, which highlights that a basic aspect for the digital transformation of the company is a change in organizational culture.It is necessary to break silos and have multidisciplinary teams that design, develop and implement customer-centric strategies. In fact, 75% of the surveyed entities are committed to organizational changes and 60% propose to create specific working groups to propose a digital transformation process in the company. The development of a customer-oriented commercial system is fundamental in this change and to achieve it, most entities consider that the commercial, marketing and technology areas must work hand in hand.

The study also highlights that to implement actions aimed at a digital environment, 92% of companies consider it essential to start with pilot projects seeking to identify the associated benefits, the necessary levers for their achievement and a short-term return on investment to win the confidence from top management.

Level of progress of omnichannel in the sector

The entities participating in the study consider that omnichannel presents opportunities for travel both in commercial processes and in services, customer service and cancellation management. The most used channels are still branches and telephone service, and this is due to the fact that the transactionality for the management of procedures is more developed in these channels. The most omnichannel processes are those that are truly strategic for the business, such as marketing, communication and customer service. For example, marketing campaigns for insurance cross-selling are launched through digital channels such as push notifications.or email, referring the contract to the web or telemarketing when necessary. It is not surprising that on the other hand, cancellation management is not a priority in terms of digitization, although this process is already available online in 62% and through mobile applications in 32% of the companies surveyed.

In general, the executives of these entities are convinced that the digital transformation of companies involves developing perfect communication between all channels relying on customer information in real time; omnichannel communication with the customer being the initiative with the highest priority in which the companies participating in the study are working.

Support to commercial activity

In the field of commercial activity in the new digital environment, the delivery of tools to optimize commercial activity is a priority. 92% of companies report that their sales teams have a CRM, Business Agenda or Lead Management tool. However, going forward, the integration of these tools and the automation of commercial management continues to be a challenge.

The study also reflects that 82% of entities work to provide business intelligence to their teams either through predictive models or customer segmentation. Omnichannel is once again the area with the longest journey, as only 38% of entities equip commercial teams with real omnichannel capabilities to communicate with their customers.