Much is discussed around digitalisation and for global programmes, it has the opportunity to “unleash huge potential”. However, the process is complex and not without its challenges. Liz Booth spoke to experts from Zurich to gauge the risk-reward expectations.
Risk managers and customers alike continue to demand the highest level of quality from their insurers when it comes to servicing their global insurance programmes. This is not a new phenomenon, yet it can be incredibly difficult to achieve when servicing complex, cross-border, multijurisdictional programmes.
Kelly Heath, head of business transformation, international programmes, commercial insurance, Zurich Insurance Group, explained: “Insurers’ networks are typically formed of owned operations as well as non-owned or partner companies. Quality of service is ensuring that both owned and non-owned networks are operating seamlessly and complying with the high standards of the global insurer as well as delivering against customers’ expectations.”
She is well aware that the partner network is key for any insurer when it comes to the quality of service it delivers, and the selection and ongoing monitoring of partners has always been an important factor.
“Factors like, financial strength, compliance aspects, their operational fitness and how well they run their business is essential to know,” she acknowledged, while ongoing monitoring of performance on a regular basis is the norm.
However, to be successful, Ms Heath believes insurers also need to start to think differently about how they support the servicing of a global programme across multiple countries, involving many people and systems, which lead to multiple inputs and outputs, interactions and handovers.
“Removing system breaks, reducing handoffs and streamlining all the various inputs and outputs that occur, which often lead to errors and delays, and connecting parties to common platforms, will in the end increase an insurer’s ability to deliver quality of service across the network quickly, seamlessly and with very little effort. This includes connecting internally, as well as externally with customer and broker platforms as well as with partners,” she said.
While digitalisation is key, Ms Heath stressed that this is not at the expense of the people factor. It is, she said “still vitally important to the success of the quality of service”.
Adding: “With so many parties involved, it is crucial that people are properly communicating with each other, whether it be on the customer, broker or insurer side, and on both the global and local side. The global insurer strives to ensure they have people who understand the need for good customer experience, have the right mindset and keep the customer at the forefront of their minds every day.”
However, digitalisation is definitely a key factor for the future of international programme business. The team at Zurich believes it will not only help to remove complexity but also allow them to focus even more on customers and their needs, and enhance services and future product offerings.
Marcel Weiss, global head of international programmes, commercial insurance, Zurich Insurance Group, believes: “Investing in and implementing, for example, Robotic Process Automation, automated or Application Programming Interface (API) solutions were only the very early start of digitalisation and the way we use and share data together with our customers.
“Looking into the future, digitalisation will further reduce existing complexity even more than today by developing, for example, smart systems, digital product configurators or digital wording libraries with the purpose of not only storing data in user guided systems in a digital way but to achieve full transparency by linking digitalised key data, implement seamless electronic end-to-end data transfer between all involved parties of a global programme and to allow real-time data processing globally,” added Mr Weiss.
His comments come after, back in February, Zurich Insurance Group launched a Zurich Global Program Support (GPS) Tool, designed to simplify the process of structuring international insurance programmes for large multinational businesses and support them in the management of their programmes.
At the time, Zurich said the tool “provides businesses with valuable information to assist the design of international programmes and reduces uncertainty and complexity in the decision-making process”.
The insurer added: “For example, customers have access to independent and accurate legislative and regulatory data and insights, allowing them to take better-informed decisions when choosing insurance coverage across various jurisdictions.”
However, the Zurich team is keen to stress that digitalisation is not some kind of magic bullet.
Armin Schäfer, head of digital and new technology international programmes, commercial insurance, Zurich Insurance Group, made it clear: “Consistently digitalising all the core elements that make up a global programme will lay the foundation for emerging technologies to unleash an enormous efficiency potential internally and across the global programmes ecosystem.
“If we continue to strive for a higher level of structure and an immersive digital representation of insurance programmes, I can clearly see how new technologies can enable a shift to the ‘next level’, for example through smarter automation, seamless system-to-system data exchange, as well as advanced insights generation.”
Mr. Schäfer is convinced that “mature technology advancements in these areas have the power to drive efficiencies, transparency and quality into the way we setup and service global programmes”.
He pointed to the way data analytics is now supporting decision-making, while delivering greater consistency, automation and improving the quality of the decisions taken.
“Data analytics is able to take a much broader range of sources into account,” he said. “This includes ‘real world’ data points through the internet of things, historical data and industry benchmarks.”
Supported by artificial intelligence (AI), data from unstructured and fuzzy sources also becomes accessible. For the individual, researching such sources would be almost impossible.
But it is not just about having the information and being able to analyse the numbers. Customers want greater transparency and improved communication. If digitalisation is truly to work, customers need to be able to see the process and to be able communicate fully. Which is why, said Mr Schäfer, API connectivity is key in cutting out the massive email trail, manual reporting and in allowing customers, brokers and carriers to connect seamlessly.
Finally, he believes intelligent automation will have a key part to play into the future, leveraging AI and natural language processing technologies to master unstructured data intake and support underwriting and claims processing.
There are challenges too: for example, Mr Schäfer does not believe there is a “common language”, a data standard, at a global level, which makes effective technology-driven communication and collaboration among the players extremely difficult.
“The more this challenge could be overcome,” Mr Schäfer suggested, “the more we can unleash the enormous potential of efficiency gains across a global programmes ecosystem.”
As Mr Weiss concluded, digitalisation will play a key role in reducing complexity going forward. “Digitalisation and connectivity of data will unlock the expert knowledge and will achieve transparency which often sits in functional silos,” he suggested.
“Smart knowledge databases, digital data connectivity, automation and user guided systems will replace people expert knowledge and historically grown expert systems,” he added.
Along the way, there will be some challenges, however Mr Weiss firmly believes: “Consequential necessary changes and adaptation of existing local and global processes, organisational setups and new role definitions will lead to new ways of working regarding cross-functional as well as cross-country collaboration, and will reduce global programme complexity radically.”
Commercial Risk and Global Risk Manager are hosting the Global Programmes Conference on 14-16 September 2021. This year’s conference will be hosted over three days and will look at the challenges in the insurance market, examine possible solutions and highlight the benefits of programmes in providing global coverage for a multinational. Click here to secure your seat at the event.