Pandemic reveals three key areas life insurance companies need to focus on going forward

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Nearly four in ten executives said technology was their company’s biggest internal challenge, twice as many as in 2019 (Image: Shutterstock)

While the pandemic has prompted life insurance companies to accelerate their digital adoption to ensure business continuity and serve their customers, it has also exposed the challenges of legacy systems, siled operations and the continued need to modernize. .

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The latest C-suite life insurance executive survey conducted by LIMRA and Boston Consulting Group revealed three priorities for the industry:

  • Modernize technology
  • Embrace the future of work
  • Pursue new areas of growth

“In our survey and discussions, life insurance executives around the world have stressed that their businesses need to adapt to the high expectations of clients, advisors and employees in the post-pandemic world,” according to the report. ‘investigation. “Every carrier we spoke with described opportunities to build on successes or, in many cases, expand transformation efforts.” The results of the survey provide a roadmap for pursuing these goals:

Technology

Nearly four in ten executives say technology is their company’s biggest internal challenge, twice as many as in 2019, in the last survey. Executives surveyed said digital automation and data science and analytics are the key technologies needed to drive their companies’ marketing, distribution and customer experience advancements over the next five years. Six in 10 said investing in customer service technologies, modernizing existing systems, and mitigating cybersecurity threats would be essential to be competitive.

Future of work

In addition to introducing the need for remote and hybrid working arrangements, COVID-19 has also underscored the need to adapt to ever-increasing digital-based customer engagement. Two-thirds of executives surveyed said embracing digital innovation would be most important for the future of work in industry. This transformation of the workforce will require significant changes in the way employees are managed. Sixty percent of executives said the biggest challenges associated with managing change will be cultural.

Growth

Insurers must not only develop new models that deliver life insurance to clients where they do their banking, shopping, work or travel, but they must also reinvent the way advisors interact with clients and provide them with the training and the digital tools needed to achieve this. While persistent ultra-low interest rates have forced life insurers to shift their portfolios to products that require less capital and minimize risk, businesses need to develop personalized solutions that add value to everyday life. of a customer, creating greater loyalty and new opportunities.

Insurers are exploring new approaches to customer engagement to exploit growth opportunities. From health and wellness products to rewards programs, workplace wellness programs, voluntary benefits and the use of social media, companies can leverage these new strategies to capture more data, know the preferences of customers and refine their offers.

“The pace of change has accelerated in our industry and around the world, forcing life insurers to adjust their strategies not only to meet the current demands of today’s customers, but also to ensure competitiveness in decades to come, ”said Alison Salka, PhD, senior vice president and director of LIMRA Research.

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