Digitalization will ultimately be the foundation on which insurers will build new experience management strategies to connect directly with customers and will increase market share. The rise of smart digital platforms has transformed consumer expectations. These digital-first experiences point the way for insurance companies to retake their place in their customers’ lives – and to remain relevant and competitive. Thus, digital transformation is the only journey, and you need a set of established strategic priorities to achieve all the goals. So, this article discusses industry-specific features for the engineering, construction and operations industries offered by RISE with SAP’s Business Transformation Service.
Let us begin by defining strategic priorities and their benefits for Insurance Companies!
Combining noninsurance goods and services with insurance coverages across business lines will provide protection services, which are crucial for an insurer’s success. Based on how customers use IoT sensors and devices, insurers can develop new product lines and provide policyholders with telematics data that includes advice on how to behave more safely. By exchanging useful information on services, behavior, and risk changes, they will thereby strengthen customer relationships. They can launch appropriate responses to incidents, such as emergency services in the case of accidents and police in the case of home invasions. The implementation of proactive fraud prevention tools and the use of blockchain to enable more secure transactions and processes are included in the protection services.
To better understand this strategic priority, let’s look at a current example of how houseowners operated before and after their digital transformation to better grasp this strategic aim.
Prior to transformation, the houseowner’s functionality was:
- The new homeowner (HO) receives a paper-based homeowner insurance policy in the mail without any interaction or additional support options.
- There are no early detection and remediation options available in the event of a loss event, such as a water leak.
- The process is delayed because the HO must first submit a claim online or over the phone.
- The damages will be assessed by an adjuster who has been assigned.
- The repairs must be started by the HO directly engaging a service provider.
- Due to ineffective process steps, the closure of the claim is delayed, increasing the claims loss ratio.
- The difficult claim process lowers customer satisfaction, and chum is probably.
Post transformation, the houseowner’s functionality was:
- A smartphone insurance package that includes the installation of a security system and sensors for smoke and water leaks is sent to the homeowner along with the purchase of a new house by the insurer.
- When a water leak in the basement is detected, HO is given the option to turn off the water supply.
- The smartphone app offers the option to submit a claim, and the data is saved automatically (loss location, HO policy, and so on.)
- The insurer assigns an emergency repair service from the Ariba Network chooses the service based on best performance and agreed-upon price; and assesses the calibre, swiftness, and expense of repair facilities to provide ongoing evaluation for updates to the “Best Providers” list.
- The insurer’s up-sell opportunity to provide a premium assistance package enables the HO to go forward with lowering deductibles.
- According to analytics data, claim closure times have decreased, loss ratio reserves have improved, and customer satisfaction and retention have increased.
- Insurance companies can now record “in-the-moment” customer feedback to learn more about the feelings and sentiments of their clients.
In conclusion, the home owner’s use of antiquated manual techniques prior to the transition hampered the overall process of filing an insurance claim. Following the change, they completely switched to using an application on their smartphones to submit claims and handle insurance-related issues, which was successful.
Now you may be asking, “How can RISE with SAP helps us?”. Here are the primary business capabilities they offer to assist you in reaching your objectives:
- By combining noninsurance products and services with insurance coverage across business lines and through the integration of SAP S/4HANA for insurance and logistics, hybrid products are made possible.
- Insurance companies can connect SAP S/4HANA with partners, and ecosystems using API capabilities.
- SAP S/4HANA and SAP Cloud Platform integration provides full platform capabilities on cutting-edge technologies.
- Enable more secure transactions and processes by deploying proactive fraud-prevention tools and using blockchain.
- Improve customer relationships by sharing useful data across industry boundaries on services, behaviour, and risk changes (for example, automotive and insurance).
Top Value Drivers
The major value drivers in the engineering, construction and operations companies post successful deployment of SAP S/4HANA are:
- 5%–15% Increase in revenue from cross-selling and up-selling
- 5%–10% Decrease in customer service and support costs
- 20%–30% Reduction in losses from unforeseen risk
(Note: Data was taken from SAP’s statistics)
To summarize, the success and growth of insurance companies is dependent on digital transformation, and SAP S/4HANA is a one-stop solution that can provide intelligent and industry-specific benefits. If you want to learn more about SAP S/4HANA or other solutions that can assist enterprises in the finance industry, feel free to contact us!