Today’s insurance market is fiercely competitive, prompting carriers, agents and brokers to look for any possible advantage when selling group insurance products. Because several key customer segments are cost-prohibitive to approach, carriers and brokers must identify the most cost-effective ways to capitalize on these and all segments of the market.

In addition, many insurance carriers face challenges associated with manual processes for quoting, rating, underwriting and enrolling group insurance business. Often, there are as many as 10 “human touch points” in the sales cycle. These manual processes are labor-intensive, costly and are often the deciding factor as to which markets to focus on. Carriers are also under scrutiny from shareholders to cut costs and increase the bottom line. In response to all of these pressures, carriers must simplify and automate business processes to achieve seamless data flow through the organization.

Business Process Management

Business process management (BPM) is a growing and critical discipline by which companies can boost productivity and identify business bottlenecks.

An area that can benefit from BPM is sales automation systems. Sales and service automation solutions enable insurers and intermediaries to streamline the process of quoting, enrolling and renewing insurance in order to increase efficiency, customer service, revenue and profits–making it easier to take a prospect from proposal into enrollment while being in control of the distribution and underwriting.

A majority of insurance carriers have difficulty managing the quoting and enrollment processes for tens of thousands of quotes per year for group life and health products. They need to identify solutions designed to improve business process management and increase sales by automating the entire sales process from prospecting through enrollment and ultimately renewal for the group life and health market.

By using solutions that separate business rules from system rules, insurance carriers can automate day-to-day decisions and processes, enabling speed, agility and consistency without sacrificing underwriting integrity.

Increased Revenues

Automating sales and service processes delivers increased revenue. Sales and service automation solutions and straight-through processing simply allow carriers and producers to achieve their main objective–to write more business in less time–by:

Reducing sales cycle time.

Increasing RFP response rates.

Increasing conversion and closing rates.

Decreasing discount rates.

Increasing group premiums and deal size.

Decreasing customer churn.

Another key benefit of automating the business processes that surround quoting and enrollment of group benefits products is the elimination and significant reduction of costs associated with generating a quote. These costs include labor, business process overlap, capital equipment, consumables, legal expenses and working capital. The contribution of greater efficiency cannot be minimized.

Efficiency Gains

Quotes for group insurance are often generated using manual cut-and-paste methods resulting in excessive manual workarounds. Creating an automated system that allows the distribution channel to input or upload the data directly into the carrier’s system dramatically reduces the requirement for multiple manual data entries, data adjustments and review processes in a variety of systems. On average, data is entered and manipulated 3 to 4 times by different departments in order to generate an accurate quote. Carriers need a solution that allows data to be reliably entered once in the appropriate format that is compliant with all departments and filing requirements.

When managing distribution channels using an automated and digital quoting process, agents, group reps and head offices have complete visibility to quality quotes and can spend less time playing “telephone tag” to clarify and correct issues.

Quoting Process

To compete, insurance carriers need to supply cost-effective quotes to customers in a reasonable amount of time. This industry expectation requires the carrier to quote multiple products, access multiple systems, evaluate and calculate risk, and provide multiple pieces of data to the customer in a single seamless quote.

To add to the complexity, carriers have intricate methods of underwriting and rating products which vary by geography and customer. The business processes must be robust enough to handle the thousands of business rules and contain the sophistication to produce and instantly quote with the highest level of accuracy.

Automating the entire quoting process will uncover rules that need to be improved and/or changed, allowing product and rate changes “on the fly.” These efficiency and productivity enhancements will increase the profitability of the business and increase revenue generation. It is also important to note that given increasing health costs, the ability to deliver a renewal quickly and efficiently is key to retaining business.

Other Benefits

Insurance carriers have invested many millions of dollars in systems that have been developed, purchased, inherited and reworked. Maintaining these legacy systems is a full-time job of the IT department and represents a significant portion of the company IT budget.

If front-end systems are automated and seamlessly feed the existing policy admin systems of a carrier, the investments are truly leveraged to their greatest potential.

In a competitive insurance industry, rapid response to market and customer demands is crucial. Time spent by brokers and customers waiting for insurance carriers to provide quotes results in lost sales.

Sales automation provides a lower cost structure; thus, carriers can expect increased margins and provide the most competitive pricing, thereby increasing the probability of winning new business.

Efficient, automated quoting processes give agents and brokers greater confidence and promote branding, making it easier to attract and retain high performing distributors and expand distribution channels.

In addition, low customer retention rates can be directly attributed to poor customer service demonstrated by slow response to their needs. By automating the sales process, companies can increase customer retention.

Beyond the measurable results in cost and revenues, there can be many other benefits that increase the productivity of an insurance carrier and support corporate goals. Specifically, gains can be achieved reflecting positively on an insurance carriers’ stock price and customer perception as well as enhanced brand and competitive position.

Are Business Process Management and sales automation critical requirements for your business? Has your organization identified and measured the benefits and costs associated with a sales and service automation solution? If you haven’t yet, look for a provider that can review your current processes and recommend cost effective solutions to automate your business processes.