Automation is being embraced by business leaders as the linchpin of the insurance industry’s future success, according to IT services and consultancy business NTT DATA UK.
The research surveyed senior London Market syndicates, brokers and managing agents, uncovering that 70 percent believe automation can significantly benefit business development.
Appetite for this digital transformation of the insurance business model is growing as costs rise within the market – for every £1 spent by Lloyd’s customers, around 40p is consumed by costs. As such, the majority of respondents (59 percent) recognise digital as important to their business today, rising sharply to 97 percent who believe digital will be important in the next three years.
The report said that automation has applications across London Market business functions, whether it is assisting finance by extracting invoice information or applied in underwriting to generate policy documentation from details on the system.
Potential cost savings are transformational as automation can take on the workload of a regular employee at only one third of the cost, freeing them to focus on more critical tasks that have greater benefit to the organisation, such as appraisals and negotiation.
According to the report, the ROI for automation in the London Markets is between 30-300 percent, per year, depending on the process. For example, automating the approval of claims can reduce the time taken from hours, to minutes, meaning more claims can be processed in the same amount to time.
This ROI comes as a result of automation “delivering value” to clients.
NTT DATA worked closely with a number of its clients in the London Market to implement a fully managed Robotic Process Automation (RPA) solution, improving how the insurers processed data. RPA allowed these organisations to minimise manual data input and processing, freeing up employee time for data analysis and high-value insights – in one team, a robot is now able to process 100 percent of the tasks for a particular customer.
Kim Gray, Head of Insurance and Head of Diversity & Inclusion at NTT DATA UK said: “The winds of change are blowing through the insurance industry. Ongoing cost challenges are encouraging insurance executives to look for innovative solutions to secure the long-term future of their sector. Automation is at the forefront of their minds, offering a way to cut costs, improve efficiency and, ultimately, build a more profitable business. Most importantly, new on-demand business models mean that automation solutions come with minimum risk for executives.
“The COVID-19 pandemic has raised urgent questions for businesses about building resiliency into their systems.
“Automation is a robust option for the London Markets to make the necessary changes at pace: protecting revenue, solving existing inefficiencies, and preparing themselves for the upsurge of activity in the recovery.”
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