Insurance companies see the benefits of deploying digital strategies, but are being held back by a lack of focus on customer experience, according to new research from Infosys and Forrester.
The study found 47 percent of insurance companies recognising that digital can play a major role in their growth, with 44 percent believing that it could provide a unified customer experience.
Digital self-service was identified by 44 percent as a key priority to improve customer experience and drive revenue growth. 29 percent believed that Big Data was having a positive financial impact on business due to improved underwriting.
In addition, more than a fifth identified the Internet of Things as a catalyst for creating a positive financial impact on bill payment, policy administration and agent management, while 25 percent acknowledged the role of digital marketing in winning new business.
However, while insurance IT practitioners recognised these business benefits, they were found to be struggling in the customer arena. 60 percent of insurers highlighted that they are hampered by poor quality customer insights. 65 percent claimed that their digital technology portfolio is the result of an as-needed, ad hoce procurement approach.
50 percent also said that the lack of a digital innovation strategy prevents delivery of digital marketing initiatives that drive growth, while 24 percent cite a lack of skills as the biggest obstacle to make digital technology effective.
"Insurance organisations would be well served to grow their digital capability investments that drive better customer and agent experience by adopting customer-centric technology, organisation, and process change," the report reads.
Insurance companies were recommended to "forge cross-company relationships to develop and support the digital agenda… leverage Big Data to create high-value contextual experience… [and] selectively outsource to accelerate the speed of digital time to value."
Manish Tandon, Executive Vice President and Head of Healthcare, Insurance and Life Sciences at Infosys: "While many insurance companies have developed effective ways to leverage digital technologies to engage with customers, too many are not putting the customer experience at the heart of their strategy.
"This technology-led, ad hoc approach to digital will not work," says Manish. "Best practices in insurance and examples from sectors such as retail consistently show that being laser focused on customers, and using analytics to develop a deep understanding of customers, are the most important factors in getting digital right."