Business process optimisation for insurance companies before, during and after the pandemic

Approximately 7 minutes reading time

Oliver Urlauber looks back on a long career in the insurance environment, in which he worked in various roles for different, international companies. He is currently Sales Director DACH at CCS and helps insurance companies modernise their legacy systems with our award-winning Digital Insurance Platform. In today's interview, he comments on the need for effective business process management to shape the digital transformation of insurance.

How do you assess the current status of business process optimisation in the insurance industry?

Certainly, insurance companies have tried to optimise their business processes in recent years, but the really successful examples are rare. Often, existing processes are only partially automated, or the optimisation is an improvement for the insurance company, while the end customer does not feel the effect of the optimisation at all. One of the main reasons is often rigid, core insurance solutions whose flexibility regarding processes is very limited.

Do you have a practical example of this?

Of course. When we optimise a claims process with insurance companies in workshops, the insurer's requirement is often that the first information requested from the insurance customer is his policy number. This is understandable on the basis of the existing processes and systems, but it is not what’s required from the customer's point of view. Let's give insurance customers the chance to easily and quickly record or name the information that is important to them, in order to then have a transparent and continuous customer-focused dialogue, so that they can appreciate both the progress of the claims processing and the "caretaker" role of the insurer.

Often, inflexible legacy systems and technical constraints are the cause of limitations in process ideas and process optimisations. I am not blaming the employees who have experienced these technical limitations frequently and over the years and whose creativity has been slowed down. What good is a creative, customer-oriented process that is technologically very difficult or costly to implement?


What do you see as the three critical success factors for a successful business process management strategy?

  1. It all starts with the cultural willingness to think about processes from different perspectives or roles and to align the interests of insurance customers with those of insurance companies. Agile methods can help with this, but top management that focuses more on the insurance customer is also a good basis for rethinking. Of course, this is easier said than done, but I see movement and noticeable progress in many insurance companies.
  2. The technological barriers already mentioned must be dismantled in order to avoid repeatedly falling back into the limited possibilities of legacy systems and the processes anchored in them. This does not necessarily mean replacing legacy systems. Often there is also the option of introducing a flexible process management solution without exposing oneself to the risk of a complex migration.
  3. Another decisive factor in my opinion is the good old 80/20 rule. The degree of automation should be implemented for 80% of the processes in order to be able to use the free resources for fast and high-quality processing of the remaining 20% of cases. Sounds simple, but practice shows that this basic rule is often neglected in these projects...

In which steps do you see opportunities for insurers to increase their degree of automation?

If the above-mentioned success factors are in place, then step 1 is definitely to focus more on optimising business processes. Currently, the insurance industry is still lagging behind in terms of the degree of optimisation when compared to industries such as telecommunications and automotive.

Step 2, in my view, is to lay the technological foundation for the implementation of optimised processes. An innovative process modelled in BPMN is often not interpretable by outdated insurance systems. Great process tools that are only effective in the online closing process for a liability product are clearly not enough here. However, there are already innovative, comprehensive and graphic tools that also enable business users themselves to create or adapt executable insurance processes.

Step 3 is then to use existing best practice processes for standard business - so please don't reinvent the wheel and start from scratch. At the same time, one focus of process optimisation should be to realise innovative concepts with high visibility. Integrating new eco-system partners into a business process is a good example here. If automated and optimised processes are realised beyond the company's boundaries, they can have a pull effect for many process areas in the company.


What do you expect specifically this year in terms of business process optimisation at insurance companies?

 The pandemic has significantly increased both the demand for and/or the necessity of self-service processes. It is understandable that not only digital-savvy customers want or need to use the self-service offerings of insurance companies. Conversely, this means that the processes, especially online, must be made even easier for customers, and technological barriers must be further reduced. The type of customer hardware, for example, should not play a role; responsive interfaces that work effectively on tablets, PCs or mobile phones are standard today - the level of ambition of insurance companies should be much higher here. The medium the customer chooses should also not be a limitation. Whether a customer calls the service centre or uses the online channel should not make any relevant difference to the quality and speed of the process.

Furthermore, due to the continuing interest rate policy and the associated cost sensitivity, I expect increased attention to processes that are currently still "expensive", i.e. time-consuming and insufficiently automated. By 2025, I expect comprehensive optimisation in almost all processes at insurers.

All in all, we can expect a greater demand for faster change this year and, with the right technological basis, significant optimisation in the area of insurance processes at insurance companies.