February 1, 2016 | Written by: Craig Bedell
Categorized: Client Stories
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When I look at the role of technology in the insurance industry, one of my first thoughts is how the proliferation of digital technologies has revolutionized the relationship between consumers and businesses. Today’s customers are more empowered than ever before. They can easily compare pricing, services and other differentiators to find the right products among numerous options.
Many marketing materials read that “to succeed in today’s digital era and meet growing client expectations, insurers must be smarter in the way they approach data”. And I can see how some may be tired of these claims. But capabilities that enable organizations to uncover valuable insights hidden in the form of notes, reports and unstructured data are now a key differentiator to creating value.
Additionally, I am now seeing leading companies exploring the potential of cognitive computing to drive the next level of customer engagement. Cognitive-based systems such as IBM Watson™ fundamentally change the way humans and systems interact. Because they are able to engage in dialogs with humans, cognitive systems can understand customers based on past communication and behavior.
Already, some insurers are deploying cognitive systems and using digital advisors to help insurance underwriters make better decisions that go beyond the current use of role-based knowledge and the retroactive based predictive analytics. We’re also seeing numerous examples of how cognitive systems aid in decision-making and reduce human bias by offering evidence-based recommendations.
In claims management, they reduce processing times by instantly recognizing relevant passages from documents and communications. These capabilities also augment and help filter data and information to combat fraud, as well as help in the design of risk management or investment programs for policyholders.
Cognitive systems can also be exposed directly to the client for advisory services. For example, insurers are already discovering that customers like to communicate with a system that can answer questions and inform them about policy details. In fact, customers often seem more comfortable posing questions to a system rather than a person, which can help deepen their understanding and appreciation for insurance.
While the digital age has brought a wealth of data, without new capabilities, the paradox of having too much data and too little insight will continue. The answer lies in cognitive computing, which helps bridge the gap between data quantity and data insights.
The benefits of cognitive computing are not realized in a single “big bang” when they are initially rolled out. Instead, cognitive systems are evolutionary and provide increasing value based on new information, outcomes and actions. Therefore, early adopters can gain an important competitive advantage that will allow them to create unique, compelling customer engagements that drive the most productive outcomes.
For insurers, the cognitive computing era has indeed arrived, and its potential to transform the industry is enormous. Are you ready for the future?
For a deeper look at the potential of cognitive computing, check out this white paper: Understanding Customers and Risk: Your Cognitive Future in the Insurance Industry.