Scale Your Insurance Business with Policy Renewal Automation

Automation is the future of efficiency. From autopiloted cars to smart homes, automation has undeniably become part of our lives. Relieving us from manual tasks, helps us focus on interesting and engaging tasks while eliminating tedium. When it comes to the insurance industry, an automation strategy can help agencies make the process of renewals easier and more effective. A quality automation software can reduce the time and effort spent on repetitive tasks.

With the emergence of insurtech, agencies and brokers are in a position to optimize their work using automated tools. This allows them to spend less time processing forms and entering data manually. This blog talks about how insurance penetration and its surge have resulted in companies adopting AI and automation to help their businesses scale.

Automating Policy Renewals

Policy Automation

Your clients should not be burdened with last-minute policy renewal decisions. You need to establish a proactive approach to policy renewal through automation.

Policy renewal automation can either be deployed for all policy types or used for specific policy types. The software can also be configured to send emails and text messages directly to policyholders. Start by filtering out a comprehensive list of repetitive processes that can be automated. Once this is done, prioritize this list according to their usage frequency. Create workflows and integrate technology to minimize the time and manual actions needed to accomplish these tasks.

Automation will help you maximize results while minimizing costs and implementation challenges. You will be able to quickly deliver complete and accurate information to your policyholders while moving one step closer to reducing internal operational inefficiencies. These are the steps you need to follow before deciding to deploy automation at your insurance agency:

Insurance Policy Renewal 

  • Identify: Identifying customers coming to you for renewals from complicated spreadsheets is quite a hassle. Try a different approach instead. Record the contract end-date as a reminder in your calendar after every new sale. Customers will get notifications 90 days prior to the end-date. Automating this will relieve you of the mundane task of notifying every customer before the end-date.
  • Create: Emails are the most standard form of customer communication. Creating templates is a better substitute to writing separate emails that need to be sent at different stages of the renewal process. They can be used for repetitive interactions using standard language to save time and energy.
  • Record: Using a batch process to record all the policy renewal data can minimize manual entry. Bulk uploads can be performed using internal or off-the-shelf tools. However, they need an appropriate data management platform.
  • Cancel: Customers have multiple quote options to choose from. It is important to keep canceling and removing quotes that don’t have to be renewed. Set up a system to automatically cancel accidental duplicates to avoid confusion and errors in the future.

Having an automated policy renewal process will allow your team to spend more time nurturing customer relationships. Automation can help you:

  • Manage multiple carriers
  • Organize complex unstructured/semi-structured documents
  • Improve built-in data review and approval mechanisms
  • Integrate easily with core policy administration
  • Follow Rule-driven processing
  • Have Flexible & configurable workflows

Benefits of Adopting Insurance Policy Automation

  • Increased operational efficiency
  • Reduced quality checks
  • Improving SLA adherence & regulatory compliance
  • Increasing customer satisfaction

Though automation increases operational efficiency and improves processes, insurance companies need their growth to be sustainable. Policy renewal is crucial for that growth and the persistency ratio is an important metric to track your progress.

What is a persistency ratio?

Policy Renewals 

The proportion of total policies of an insurer to the policies that are renewed or in force determines the persistency ratio. It shows the number of policyholders who have active plans and are paying their renewal premiums. To stay profitable from both the customer retention and acquisition point of view, insurance firms need to maintain a high persistency ratio. It demonstrates credibility and gains customer trust.

Retaining a customer is one of the most significant and challenging aspects of business today. There is no quick-fix solution to this problem. Simple policy renewal reminders are usually ineffective. A unified approach to customer engagement across the entire lifecycle is what you need.

Strategies to maintain a good persistency ratio:

Prevent Misselling:

A large share of customers fall for misselling every day due to unrealistic promises made by profit-oriented agents. The lack of need-based selling and segmentation leads to dissatisfaction as most of the customers suffer from financial illiteracy and depend on their agents. Insurance companies can leverage AI to run customer education programs for a better understanding of the policies. They can incentivize agents through added commissions, especially for renewals.

Effective customer communication and engagement:

Customers need to understand the role insurance plays in their financial security. The best way to do this is by engaging with them throughout their lifecycle. Insurance companies can initiate programs to ensure that the policyholders feel secure and engaged. AI is a cost-effective and proficient method of engaging with many customers. They can deploy a voice AI-powered bot to place automated calls to interact and engage with their customers.

Identify and segment your customer early:

Policyholders are conventionally reminded through channels like emails and SMS. While they are a convenient mode of communication for the insurers, they might not result in a conversion. Insurance companies should initiate personal face-to-face communication with agents to resolve issues for them to understand policies better. Designing customized offers and delivering them to propensity-based customer segments has resulted in quicker renewal campaign cycles. Insurance companies all around the world have understood that the key to meeting customer expectations is through technology. They have started using AI to improve persistency ratios, engage customers and improve profitability.

Why Exdion

Insurance Automation

At Exdion, we have years of experience in the insurtech space. Our end-to-end policy automation platform works round the clock - unburdening your staff from the tedious policy renewal tasks.Our platform partners with insurance agencies and brokers to digitally transform their businesses and make them future-ready.

Exdion delivers a suite of digitization tools and platforms that work in tandem with agency management systems, cutting across new business generation, renewals and compliances.

To learn more about how Exdion can help take your insurance business to the next level, get in touch with us.

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