Data has always been the foundation of the insurance industry. Assessing risk and calculating probabilities are crucial for making policies that ensure consumers are covered, while still turning a profit. While data has been at the core of insurance for centuries, the way that it’s collected and distributed has changed over time. Insurance technology (insurtech) has streamlined the way agents, actuaries, and brokers alike process policies and assess risk.
However, many solutions are struggling to keep up with the pace of the market. Insurtech is changing rapidly as more clients are seeking to streamline collaboration on bundled policies, certificate of insurance documents, and declaration pages. This need has only been amplified through the current COVID-19 pandemic. Insurance professionals are tasked with sorting through data in all shapes and sizes, now more than ever, and they are being asked to do it remotely. This presents a unique challenge, but the fact of the matter is that there has always been more data to handle.
With 90% of the world’s data generated from 2018 to 2020 alone, insurance agencies are tasked with making data-driven decisions to remain competitive in an incessantly changing marketplace. Oftentimes, this data collection or access includes personally identifiable information (PII) that must be secured for client privacy.
Insurtech and the Consumer
In the current state of the world, insurtech is under more pressure than ever to automate processes for users. Consumers need policies quickly and agents need to make sure that they are processing their documents securely. In today’s digital-first world, consumers expect around the clock access to their providers and an informed, omnichannel experience. They want the ability to apply for a policy online, file a claim through an application, or get access to their agent through chat.
While many use an insurtech solution to streamline processes, some insurance professionals are still using email and third-party document processing software to collaborate with actuaries, underwriters, and internal stakeholders alike. Even some with insurtech solutions still use document processing tools to collaborate, which can involve downloading and sharing sensitive PII with other stakeholders in the process. The problem here is security. What happens to a consumer’s information when the server is hacked or data is accidentally shared with the wrong person via email, shared drive, or chat?
Challenges in the insurtech market
1. Internal and External Collaboration
Collaboration is key across the insurance industry. However, insurance professionals like actuaries and underwriters often use third-party solutions to collaborate on risk modeling assessments and policy decisions. Actuaries create a model that underwriters use to assess an application for approval or denial. This process often happens via email. While this may be standard in some organizations, many insurtech solutions are looking to bridge the gap and provide a more secure and streamlined way to collaborate on a consumer’s insurance application.
Several have streamlined the workflow, but still require downloading of documents and opening them in third-party collaboration tools. This remains a security problem. Insurtech solutions need a way for their consumers to view documents securely within their application, collaborate with annotations and markups, and redact sensitive PII from users without the appropriate permissions
2. Processing Data Efficiently
With so much data to analyze and understand, it’s important for insurtech companies to provide a way to streamline the processing. Underwriting a life insurance application, for example, can take up to 75 days without advanced technology. That’s a long time for a consumer to wait on an insurance application to pull through. With manual, hand written applications, human error is a certainty, leaving underwriters with missing information. They often have to reach out to agents to get missing data or incomplete fields.
Insurtech solutions are looking to streamline the underwriting process by providing an automated way for underwriters to create policies in real-time. By using a digital application, consumers can easily fill out all fields without missing a beat. In turn, underwriters and agents spend less time validating the data and more time analyzing the information it provides. While these are great innovations, many insurtech solutions need a better way to identify forms, recognize form fields, and capture the data within for faster, more accurate processing. With almost one in three adults attempting to purchase a life insurance plan online, insurance companies need a streamlined solution to compete in the rapidly increasing market.
3. Risk Assessment and Evaluation
Actuaries assess risk by creating tables for each of the common rating factors like age, gender, income, and location to set premiums. Underwriters use these models to evaluate policy applications and make decisions on which ones to accept and which ones to deny. Agents then share this information with the consumer and provide options for what coverage makes the most sense for their situation.
While this process is tried and true, it is often based on assumption. The models are based on ranges and it assumes that someone in a particular age bracket, at a specific income level, in a certain region will behave a certain way. It also assumes that a young person would not be likely to get a life threatening illness, or that an older driver would be careful versus reckless. The problem with these models is that everyone is different and there is so much data out there to analyze the behaviors, health, and actions of individuals. The problem that insurtech organizations face is accessing this data securely, capturing it with accuracy, and processing it efficiently. The insurance organizations that master this data sifting are setting themselves up for more data-driven, informed decision making around product offerings, risk assessments, and consumer demand.
4. Sharing Risk Models with Underwriters
As mentioned previously, actuaries share risk models with underwriters so that they can make informed decisions about specific consumer applications. Insurtech is evolving to provide more data analytics that can analyze consumer and policy data in real-time to better assess risk.
Data analytics can also help actuaries identify successful agents in specific regions, predict fraud, and project the best product features for better revenue. Technology advances have also unlocked new sources of data that can guide underwriters in policy approvals. With an advanced actuary model, underwriters can apply better policy decisions and create better company relationships with consumers.
While this can be accomplished via email, downloading, or sharing via chat, this is not the most secure way to assess these models and collaborate on policies. Insurtech solutions need a way to view and manipulate Excel-like documents within applications to ensure consumer privacy, abide by federal regulations, and collaborate interdepartmentally with ease.
5. Searching for Data Within a PDF
When it comes to collaborating on files securely, insurtech solutions need a way to display a variety of different documents and make them searchable so actuaries, underwriters, and agents can access the data they need quickly and efficiently. Not all documents are standard, and many come in the form of a PDF where there may be text over an image that needs to be extracted.
Insurtech consumers will need to be able to search all types of documents quickly to access data in real-time. That means that insurtech solutions must offer optical character recognition (OCR) that identifies typed characters in any file within seconds. They need to make sure that this OCR engine can search within both text and image to bring back the right result.
Insurtech capabilities that set the standard
- Document Viewing: Insurtech solutions must provide a way for consumers to view a variety of different documents within their application. As showcased above, document security is crucial for insurance agencies to maintain not only for their consumers’ sake, but also to comply with federal regulations. When selecting a document viewer, make sure that it is able to render large documents quickly and provide tools that enable secure collaboration.
- Data Capture & Collection: Insurtech companies must also build out a way for consumers to process data efficiently. Developers for insurtech companies need to connect the dots for the user. With a robust form recognition tool that identifies form fields and captures data, the developer can focus solely on routing the information into a smart repository instead of building the recognition and capture functions from the ground up.
- Document Collaboration: Insurance companies have a variety of different departments that collaborate on product creation, policy bundles, risk assessment, consumer applications, policy underwriting, and new client onboarding. With so many steps to get insured, different departments and functions, either internal or external, must be able to collaborate securely on different file types. Insurtech solutions need to look for integrations that enable commenting, annotation, redaction, and assembly.
- File Conversion: In the same way, insurtech solutions need to be able to convert multiple file types into a more organized, searchable file. Insurance agents collect all types of information, not limited to Word documents, Excel files, PDFs, JPEGs, PNGs, etc. To be able to process policy documents or claims efficiently, insurtech consumers need a way to organize these files and search within them for important data that streamlines processing.
- OCR and Search: As noted above, processing data is essential, but there is no data to process if it can’t be found on documents submitted. Insurtech solutions must prioritize OCR and search capabilities within their applications to streamline collaboration, provide better data discovery, and solve big data challenges for consumers.
Improving insurtech offerings with SDKs and APIs
Transforming manual processes into automated, digital solutions can save time and cut costs. With these integrations, insurtech developers can streamline their sprint work and focus on valuable projects, without spending time and energy to maintain these core foundations on their own. The 5 key process areas include: collaborating on Policy Bundles (by integrating a versatile, web-based HTML5 viewer, insurtech companies can empower users to view, annotate, and redact over 100 different file types from a browser window); recognizing forms & capturing data (using advanced form processing with standard form recognition and data capture, insurtech companies can streamline data capture with confidence); evaluating risk with actuaries (enable your application to import, edit, and export XLSX without dependencies on Excel, and separate proprietary business logic, formulas, and calculations from your user interface); sharing information with underwriters (collaborate securely with internal and external stakeholders by converting emails, texts, Word documents, images, and more into a consolidated PDF within your applications); and automating critical contract processes (keep contract content consistent and controlled and automate repeatable parts of contract generation without compromising security).
Innovative SDKs and APIs
APIs and SDKs are efficient tools that provide innovative functionality to developers and product engineers. With solutions that specialize in document viewing and editing, form processing, data capture, search, and more, insurtech solutions can enhance evolving applications with essential document management foundations.
Streamline collaboration efforts and deliver unified services with annotation, redaction, eSignature, and more under a single, customizable framework.
Empower your users to consolidate all file types into one searchable PDF to streamline work with underwriters and actuaries.
FormSuite for Structured Forms
Integrate our backend forms processing functionality to identify standard forms, capture data, and report confidence values for each inquiry.
Discover how you can improve your InsurTech application with Accusoft’s SDKs and APIs. Learn more about Accusoft at www.accusoft.com.