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The Connected Business of Insurance

Top 10 Insights on Digital Technology Adoption

December 21, 2017

by Applied Communications
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Changing insurance marketplace dynamics require you to do more for your business in less time. It’s no longer enough to go un-automated with paper files and manual records. Disparate systems of record cannot support a growing digital agency. That is why agencies must embrace digital technology to simplify and amplify current processes. Technology expands your business’s communication channels – to clients and insurer partners. It mobilizes your staff from their desk to the field. Digital technology elevates your role as a trusted advisor, making you present at all moments of opportunity – anytime, anywhere.

When you think about the core promise of insurance – to safeguard and protect what matters most in people’s lives – it is vital to use digital technology to ensure your agency will be there when your customers need you most. There is significant opportunity and competitive advantage to be had for agencies willing to adopt new technologies and implement digital transformation strategies.

How well are agencies adapting to the digital transformation of insurance?
The latest results from the Applied Digital Agency Survey provide industry-wide benchmarks by which agencies can gauge digital technology adoption and overall industry progression toward digital transformation.

Here are our top 10 takeaways from this year’s report:

More and more agencies are embracing technology to transform their businesses. The average Digital Agency Score this year increased from 42% to 44%. While this finding does indicate slight progress in the adoption of technology, as a whole, the insurance industry is still lagging behind other financial services organizations.

Agencies that use digital technology are experiencing greater monetary return per employee in a number of areas, including, 30% higher revenue when using an integrated management system, 35% higher revenue when hosting software in the cloud, and 40% higher revenue when using a business intelligence tool. Overall, agencies that completely transform into a digital agency experience 144% higher revenue per employee than those that do not. Leveraging technology automates operations so that agents can focus more on selling and serving customers, rather than working on manual, administrative tasks. Focusing more on your customers enables you to create a better customer experience so that you can increase retention, attract new customers and ultimately drive the growth of your business.

Adoption of agency management systems is nearly ubiquitous across the agency channel with a score of 95%. An adoption rate just shy of 100% in both 2016 and 2017 reveals that agencies worldwide understand that the management system is the core of their business operations.  A foundational management system enables you to manage your entire operations – across all roles and all lines of business – within a single application. It automates business operations and creates standardized workflows to increase efficiency and staff productivity.

Among the agencies using a foundational management system, 25% do not have visibility across all departments – P&C, Benefits and Sales – within their systems. To ensure your business capitalizes on each business opportunity and provides the best customer service, it’s critical to have a unified system that provides a comprehensive view of your entire business. Using a single application to manage your entire business, eliminates the need for multiple systems and duplicate data entry so that your staff can be more productive and make better business decisions faster.

Convenient digital services, like eSignature, are also on the rise with a 32% increase in adoption. eSignature offers a quick and seamless way for your business to provide customers the convenient digital service they expect while keeping all workflows within the management system, reducing time and expense spent managing paperwork.

With help from their insurer partners, agencies are going paperless by utilizing download services. eDocs and Messages download was the standout download service this year with an 89% increase in adoption. Download automates the exchange of policy, claims and billing information between you and your insurer partners. The ability to work in one management system versus referencing individual insurer portals allows you to operate more efficiently, provide better customer service and increase business growth.

Mobile customer service remains an opportunity for agents with only 24% currently offering this additional channel of communication to customers. It’s essential for agencies to provide greater flexibility and servicing options to clients and prospects via mobile applications and web portals. Today’s consumers demand anytime, anywhere service and the businesses that don’t provide this risk not surviving long term.

Ubiquitous access to client information – across devices – is becoming mainstream. Yet, only 48% of agencies currently provide mobile access of their management system to staff.  Mobile applications untether agents from the office by providing them with remote access to information and tools within the management system. Being able to conduct business on the go allows staff to be more productive and to take advantage of new opportunities.

Safeguarding what matters most is the core promise of insurance, which is why 72% of agencies rely on the cloud. Hosting the applications in the cloud that your agency uses day in and day out ensures continuous, secure business operations. By leveraging software that is accessible anytime, anywhere and backed up by redundancies, your business is always available to customers – even during a disastrous event that historically would have completely disrupted operations. Additionally, by eliminating the time and expense managing IT systems, more of your staff’s time can be spent selling insurance and servicing customers.

Data insights from management systems remain untapped with only 17% of agencies using a business intelligence tool. Year over year, the adoption of data analytics tools remains virtually unchanged. Regardless of size, revenue or geography, many agencies do not have the advantage of increased visibility and data-driven insights that data analytics tools provide. With more insights into client policy details, preferences and geography, agencies can focus on the most profitable growth areas, build stronger relationships with the most responsive insurer partners, and deliver a higher level of customer service.

Step into the Digital Age
While the independent insurance agency channel has progressed in its adoption of technology, this year’s results indicate that there is still considerable opportunity for agencies to digitally transform their business to provide complete connectivity to staff, insurers and insureds.

Regardless of where your agency ranks compared to your industry peers, understanding the role digital technology plays in delivering on the promise of insurance in a world more connected than ever before is the first step to ensuring your business thrives today, tomorrow and in the years ahead.

To gain more industry insights and to learn how technology can help your business grow, read the 2017 Digital Technology Adoption Benchmarks and Trends.  

Download the full Applied Digital Agency Annual Report >

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