RPA in Insurance: Why Automation Is Inevitable and How to Introduce It

Denis AstapcheniaHead of Financial Services at AndersenNov 03, 2021

Why insurance needs automation

Automation of business processes means the use of software robots to automate routine tasks. Any repetitive processes are prime candidates for automation.

Insurance companies regularly do a huge amount of paperwork. This paperwork takes up time that employees could devote to more important strategic tasks. As the volume of client data grows, insurers are aspiring to shift the burden of time-consuming work onto virtual assistants.

Although robotic process automation in financial services (banks, financial companies, and insurance agencies) accounts for 29% of tasks, insurance companies lag behind financial enterprises in implementing RPA.

Benefits of RPA insurance services

Robots are versatile assistants that quickly and accurately cope with work and are able to:

  • reduce the number of errors,
  • speed up work execution up to 80%,
  • cope with a large volume of tasks (by working 24/7),
  • increase business profitability by 2-4 times.

Why does a robot need less time to complete tasks? It doesn’t get distracted and can work simultaneously in several systems: Outlook, Excel, CRM, Word, Chrome, etc. Robots take on the following tasks:

  • accumulate data about clients from various sources,
  • enter information into company systems,
  • transfer data from tables to systems and vice versa,
  • verify key business information,
  • send emails and notifications,
  • create invoices,
  • prepare reports on insured events, etc.

RPA use cases in insurance

Experts note that 43% of operations in the insurance industry can be automated. Let's consider the five most common.

1. Claim processing

Imagine that an insured event has occurred with you, so you are applying to your insurer for compensation. Obviously, it is important that the company responds quickly to your request. Robots sort claims and take on standard cases, while situations requiring critical thinking are passed on to insurance agents.

Along with that, chatbots do the following:

  • help users register by answering their questions about creating an account, canceling or changing a subscription,
  • support clients round the clock, advising them on standard issues,
  • sort clients according to their needs, determine what topics they describe, and send them to different departments - for example, some clients go to the sales department and others to the support service,
  • rank clients into primary and secondary urgency, and perform other important tasks.

UiPath has created a robot that extracts data from client correspondence and compares it to standard claim forms. With this technology, collating data takes 42 seconds, instead of the four minutes that a human would spend on it. Thus, the program helps to save 18,000 hours and around $195,000 in six months.

Given the fact that the performance of bots can be improved with the help of Artificial Intelligence and Computer Vision, this technology looks promising.

2. Underwriting

A robot collects information from various sources, which makes it possible to assess the degree of risk of a person or object (house, car, and so on). Based on this data, the program calculates insurance premiums. If done manually, this procedure can take several weeks.

Robots help to retain clients, as collecting and entering data demands less time. An example of this approach is the Root underwriting system, which analyzes a client’s driving experience and offers them a fair price. Experienced drivers can save up to 50% on insurance, and companies get more accurate insights to predict risks and estimate premiums.

3. Keeping insurance contracts

Maintaining an insurance company's client account means that an insurance agent registers your form, creates, and, if necessary, cancels the contract. Insurers must double-check premiums and analyze duplicate data.

There are standard systems for keeping insurance contracts. They are expensive to maintain and update, and they don’t scale as quickly as desired in the context of a growing market.

RPA overcomes these challenges. Bots are fast, productive, and easily scalable. They take on the registration of forms and payments, cancellation of contracts, renewal of client accounts, classification of insured events, etc.

4. Accounting

Robots also perform some accounting tasks: prepare reports, process payments, and issue invoices.

Insurance companies are obliged to process documents based on PCI standards, HIPAA confidentiality rules, tax laws, etc., with regulations changing from time to time. Algorithms, in turn, quickly find relevant information and accurately fill in forms.

5. Ensuring client satisfaction

Several years ago, the large Polish insurance company PZU faced a problem - their client base was growing, and employees couldn’t fully provide personalized service. After the organization implemented RPA, the number of decisions made increased by 15%, the call center time was halved, and the accuracy of data entry increased to 100%. People began to receive answers to their claims faster, and insurance agents were enabled to devote more time to clients.

How to implement RPA in insurance processes

Below are steps to follow if you want to successfully implement RPA in your processes:

  1. Determine which procedures to automate.
  2. Draw up an automation plan and criteria for evaluating the success of the implementation process.
  3. Decide who will be responsible for implementing RPA. This can be an internal IT department or insurance software companies.
  4. Train your employees in new working methods.

Conclusion

RPA in insurance has great potential - 40% of companies have already benefited from robotization. These technologies bring such important benefits to businesses as rapidity, profitability, and satisfied clients.

Andersen develops insurance software solutions and helps companies successfully integrate them into their processes. All steps - from idea to technology development and implementation - will be taken on by our experts in order to accelerate the digital transformation of your insurance business.

Denis Astapchenia

Denis Astapchenia

Head of Financial Services at Andersen

My name is Denis. I am the Head of the FinTech department at Andersen. We are engaged in the development of IT solutions for banks, as well as investment, insurance, and FinTech companies.
If you have any questions, contact me using this button.

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