How to Change Behaviors in Commercial Insurance

The rise of insurtechs and the tech revolution took the insurance industry by storm in the 2010s. During that time, dozens of insurtechs unsuccessfully tried to replace people with computers.

As tech companies regroup, we’re seeing a surge in insurance technologies that empower users rather than replace them.

Unfortunately, many commercial insurance users are comfortable with legacy and analog systems, failing to recognize the need for change. While these processes may have been effective in the past, they’re not optimized for tackling today’s challenges.

Besides being slow and inefficient, legacy systems can also be unnecessarily costly. Some statistics estimate insurers spend as much as 80% of their IT budgets maintaining legacy systems. As a result, commercial insurance carriers, agents, wholesale brokers, and underwriters need to adapt. 

By nature, most of us are somewhat resistant to change. Historically, the insurance industry hasn’t always been a proponent of evolution. However, changing behaviors in commercial insurance can offer users a tremendous competitive advantage.

The proliferation of insurtech continues to enable the commercial insurance industry to change for the better (if implemented correctly).

By embracing change, organizations and professionals in the commercial insurance space can increase efficiencies, reduce costs, and generate more business.

Here are five ways to help promote those changes.

#1 Focus on the Value of Standardization and Automation

Standardizing and automating processes and systems can help commercial insurance users be more productive. Individuals and organizations who shun technology squander countless hours on processes they might be able to achieve instantaneously with technology.

Utilizing technology to create and automate a uniform system can minimize mistakes and save time. Sometimes, users falsely believe technology will do all the work for them. In reality, users still have to work, though automation tools can help support them and enhance their productivity. These changes can allow users to take back valuable time to generate more revenue and better serve customers.

Traditional commercial insurance systems are quickly becoming obsolete. Some legacy systems still have users writing down information by hand and bringing it to a carrier for a quote. This process is inefficient and more likely to lead to errors than a standardized, automated process.

One way to help change behaviors among commercial insurance users is to help them recognize the value of technology. These technologies can improve processes and workflows, giving users back valuable time to address work that requires a human touch.

#2 Maintain an open mind and adapt before you’re forced to

Sometimes, change looks different than what we expect it to look like. Keeping an open mind is crucial for the success of anyone in the commercial insurance industry today. From digital underwriting and claims to rising demand for cyber insurance, the industry is changing.

Don’t wait until you’re forced to open your mind to new technologies and processes. The COVID-19 pandemic forced the industry to accelerate its adoption of new technologies. In response, insurers (and investors) turned to insurtech, pouring billions of dollars into these technologies.

Continuing to improve and innovate is key to providing superior customer service. Change can be uncomfortable, but new solutions are essential for sustained growth and success.

Keeping an open mind doesn’t have to mean trying every new technology or completely uprooting existing systems. In some cases, replacing legacy systems is the most cost-effective path. Other times, you may be able to improve legacy systems by wrapping them with modern tech systems. The theme here is that you need to be flexible. Change how you approach challenges by evaluating new ideas and concepts with an unbiased, open mind.

#3 Lead from the top down with a change management plan

By some accounts, change management is one of the greatest challenges in the insurance industry. A change management plan can help ensure a smooth transition to new technologies and the long-term success of organizational changes. 

According to Deloitte, an estimated 70% of digital transformations fail. McKinsey’s Harry Robinson suggests poor leadership may be one cause. “During the early stages of the transformation, he or she [the CEO] doesn’t build conviction within the team about the importance of this change or craft a narrative that convinces people they need to make the transformation happen. People throughout the organization don’t want to invest the extra energy to make change happen.”

Robinson continues by saying these companies “don’t put the right change-management infrastructure in place…or they don’t set regular performance-management discussions to track progress.”

Leading from the top down is critical for any organization adopting new technologies or implementing change. Changing behaviors involves far more than just deploying new systems. And, though you might only be replacing a system, company culture can change in response, too. Executives should anticipate these changes and be the ones building the culture and leading by example. Commercial insurance leaders need to welcome change and personally drive the adoption of new systems. 

#4 Set benchmarks and track your progress

You’ve probably heard the expression, “what gets measured gets done.” Before implementing change, set benchmarks and document and track your progress.

How are new technologies and tools impacting your business? Rather than guessing, you can gather concrete data to see exactly where you started and how changes in behavior have benefited your processes.

Let’s say your previous system’s submission time averaged 30 minutes. With new tech, your submission time is now 15 minutes. By setting benchmarks and tracking progress, you can gain valuable insights that demonstrate the objective value of changes. 

#5 Be consistent and be patient

Change doesn’t happen overnight. Organizations and individual users need to be patient and consistent. Even if these changes don’t make an immediate contribution, a well-executed plan will eventually make a positive impact.

The insurance industry thinks ahead, measuring time in years and decades. Changing behaviors can move on that same timeline, which means you’ll have to exercise patience and continue staying the course.

Many users make the mistake of expecting significant changes immediately, prematurely giving up on new systems or processes. There’s no magic wand you (or anyone) can wave to affect change. You should expect hiccups and prepare yourself to endure the ups, downs, and everything in between. There’s usually some sort of learning curve associated with new technologies, but improvements will follow in due time.

Conclusion

The landscape of the insurance industry is changing and commercial insurance users have to choose between adapting and dying. Changing behaviors in commercial insurance may not be easy but it is imperative. Legacy systems are no longer equipped to handle day-to-day activities and ignoring technology simply isn’t an option. 

Keeping an open mind is a must for any use in the commercial insurance industry today. Technologies that help standardize and automate processes are pivotal for organizations and can replace inefficient error-prone legacy systems. But new technologies and processes alone aren’t enough to change behaviors in commercial insurance. 

To successfully transform behaviors, leaders need to be the first to change. Other necessities for changing behaviors include a change management plan, benchmarking and performance tracking, and, most of all, patience.

Wheelhouse is the Submission Management Platform for Commercial Insurance

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