Brokers have unique responsibilities both to their clients and the insurance companies they serve. As an intermediary, the role of a broker demands that the broker be able to add value to the transaction—by ensuring that both parties get the best deals, that communication remains smooth, and that everything is operated as effectively as possible. Digital transformation can help.
Many brokers are still resistant to the idea of digital transformation because it appears to be difficult, time-consuming and/or too expensive. The truth is that digital disruption is already occurring throughout the insurance industry, and brokers will need to move forward if they want to remain competitive. Clients are engaging in transformation, as are insurance companies. Understanding this transformation is critical.
Digital Disruption in the Insurance Industry
Digital disruption in insurance is inarguable today. Insurance has always been a field of data. Machine learning, data mining, and big data have all changed the face of the insurance industry, making it easier for insurance companies to calculate risk, and making it easier for clients to get more accurate insurance rates.
Today, clients keep apps in their pocket collecting information for their insurance companies. Businesses fly drones with IoT sensors to get information about their infrastructure and processes, all to improve their general risk. Technology is not only being used throughout the insurance industry, but is rapidly improving in size and scale.
All of this is something that modern insurance brokers must keep in mind. Not only do insurance brokers need to modernize their own systems, but they also need to understand the capacity in which their companies and clients are now operating.
Understanding Digital Disruption as a Broker
When an industry changes and evolves, those who don’t evolve with it are frequently left behind. As a broker, digital transformation is being seen on all sides. Insurance companies are automating and improving. Clients are engaging in more complicated insurance and risk platforms. And brokers need to pull this information together and relate them to each other.
Let’s take a look at safety software. Companies today frequently track the EMR (Experience Modification Rate), a complex calculation for unemployment insurance risk that is made far easier due to new technologies. Organizations can reduce their EMR by tracking incidences, investigating them, reporting them, and so forth—all things that a digital platform helps them do more effectively.
Brokers need to understand and interface with these new technologies and advise their clients on the ways that they can improve their own platforms. Safety management software is only one part of the solution, but it’s an incredibly important part.
The Benefits of Digital Transformation
Why is it that so many industries are giving way to digital disruption? Why are the majority of brokers now moving towards digital transformation? It’s because despite the “disruption” that does occur, digital transformation has a number of incredible benefits. These are benefits that a broker’s competition may already be taking advantage of. Digital disruption in insurance has become pervasive—here’s why.
- Improved relationships with customers. Customers want to know that they’re working with someone who understands modern technology and its benefits. Through digital transformation, insurance brokers are able to achieve better communication with their customers, providing information to their customers faster, and interacting with their customers from anywhere. Further, customers will notice improved benefits in their insurance services.
- Better safety. By advising clients on the right safety software, insurance brokers are able to also improve the safety for their clients. Clients will have fewer claims and better reports, but more importantly, they will have safer workers. Insurance agents aren’t just intended to help companies find the best insurance plans; they are also intended to help companies mitigate and reduce their risk.
- Lower costs. Digital transformation’s primary driver is improved efficiency. For the broker, digital transformation automates and optimizes many client-side processes. For the client, digital transformation can reduce costs by improving safety and other processes, thereby making the client happier, and more likely to stay with their current insurance options.
- Remote visibility. Digital transformation is both accessible and scalable. Brokers and clients alike can get information anywhere, and enhance visibility over the organization, its claims, and its reports.
Digital transformation is coming. It’s time for insurance brokers to get on board. Not only should brokers work to transform their own offices with better processes and technology, but they should also be able to advise their clients on the transformation that is taking place throughout the insurance industry. The first step is in understanding how new safety platforms are helping companies improve their risk and their rates.