Insurance is a complex product — but buying it should be as easy as shopping for a shirt online, and even returning it.
The race is on to automate customer service and consumer interaction in the insurance industry. Today, 80% of the time there is human interaction involved in contacting customer service about an insurance product. In contrast, when is the last time you talked to a service rep at Amazon?
The pandemic has accelerated the drive to digital in the industry. “Covid accelerated electronic and digital adoption by at least a decade,” said Ray August, president of Insurance Software and BPS at DXC Technology, in a presentation at a seminar hosted by conversational AI company Amelia.
During the pandemic, call volumes increased as people contemplated their own mortality and reviewed or changed their policies. At the same time, fewer people were available to answer calls due to increased absenteeism and the Great Resignation. And those who were working in call centres were now working from home. All this has put renewed pressure on insurance companies to enable remote working, digitise more of their business and become more efficient and effective.
The opportunity to improve insurance customer service
Calls to an insurance call centre typically break down as follows:
- 55% are about obtaining information
- 35% are about executing a transition
- 10% are about resolving an issue
In August’s view, obtaining information and executing a transaction are the big opportunities for change. Instead of 80% of all insurance calls being handled by a human only, automation technology will complement humans and ideally reduce human-only interactions to 10% of calls. The idea is to make the contact centre smarter and faster by using automation to transform interactions from either all human or all digital to more blended (human and digital) interactions.
Not surprisingly, customer demographics pose different challenges. “Older customers understand insurance products but the digital interface must be very straightforward for them; usually, they would rather speak with a person,” August said. “Younger customers are not familiar with insurance products so their questions tend to be more complex to answer, which requires human interaction, but these customers would rather have a digital experience.”
Conversational AI yields big returns for insurers
To improve customer service and address the need for more digital services, DXC is incorporating the Amelia conversational AI technology into DXC’s insurance business process services (BPS). It is integrated with the DXC Assure Digital Platform using DXC’s APIs, which interface with DXC’s robust insurance database and other solutions.
DXC has launched the integrated solution for a tier one, multi-line insurance company that was experiencing a 20% increase in call volumes year-over-year and an 18% absenteeism rate in call centre staffing, primarily due to the pandemic. The company’s integrated voice response (IVR) was not authenticating people effectively because the process was too complex (too many menu options), resulting in decreased customer satisfaction and decreased efficiency as callers abandoned self-service.
The four-month project leveraged DXC’s expertise in insurance and AI and included extensive compliance and architecture reviews. The results of the implementation with Amelia were significant:
- 7X improvement in call conversion, meaning the issue was resolved during the call, reflecting the high quality of the conversation
- 6X improvement in IVR authentication
- 20X improvement in the number of misdirected calls rerouted automatically rather than by a human
“This is a significant payback,” August said. “We are helping our BPS customers grow customer and agent satisfaction, reduce costs, and improve efficiency and effectiveness. It’s a triple crown in our BPS operation. Everyone interacting with the solution gets a more efficient and effective experience.”
The future of the digital insurance industry
One promising new area is embedded insurance: making a purchase that automatically includes insurance as part of the transaction. Two examples are buying a car (include car insurance) and booking a trip (include trip insurance). “Embedded insurance is a growth opportunity, and we need digital transformation to make that happen,” August said.
Conversational AI can make that embedded transaction more efficient and effective.
Other future uses of conversational AI include front-ending a virtual assistant such as Alexa or Google Assistant so you can ask it: “Tell me about my insurance policy.” In addition, the ability to operate in multiple dialects is very important, August said, noting that Asia is a fast-growing market.
Insurers who invest in technologies for transformation to enable exceptional customer and agent experiences, as well as company efficiencies and growth, will succeed.
Building the digital insurance industry with solid expertise
DXC has more than 40 years of experience in the insurance industry. As an insurance BPS provider, DXC operates much like an insurance company, managing over 13 million policies, and serving customers and paying claims without owning the risk. DXC services 1,900 insurance customers globally, and some 80% of Fortune 500 insurers are DXC customers.
“We have a real-world understanding of the challenges of automating and transforming processes,” August said. “It’s about using digital assets to make insurers more efficient and effective so they can grow. It’s that simple.”
This post is adapted from Ray August’s presentation at Amelia’s What’s Next seminar series. Watch the replay.