SUGGESTIONS TO INSURANCE AGENCIES FOR DIGITAL TRANSFORMATION – 1

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Recent years rising trend digitalization, changes the structures of businesses in all sectors and ensures a great contribution to reduce the costs and set up more efficient systems. The pandemic also has fostered this process even more.

Most of the insurance companies perpetually improve and develop their software and hardware structures. They allocate big budgets for these purposes and if necessary re-organise their business models

In insurance intermediaries digitalization process is slower than companies because of the investment costs, adequate existing workflows, hesitance for the new problems that could be brought by innovations, etc.

Today, there are various IT programs used by all agencies regardless of their volume and concept. But, most of the programs have the old technologies and insufficient for today’s necessities

Web-based programs, digitalization, automation, AI applications, etc. are attracting the attention of the agencies, but the vast majority of them think their current  business model is sufficient  so innovations are unnecessary.

However, it is inevitable for the agency owners who have future plans. They must innovate their business processes. Digitalization is one of the important components, to ensure improvement and progress of businesses. It would be useful  thoroughly peruse the following items for the agencies who are considering to make innovation and transformation.

  1. Before to start, it is necessary to set expectations and goals clearly. Digitalization does not make a significant difference if there is no improvement and development in the structure and operations. (If you purchased a new program and keep the current structure, the benefit of change could be insufficient )
  2. Agency should plan the innovations according to defined targets. Consequently digital transformation programs should be suitable for the new operational and structural improvements. (if renewal communications planned automatically, you should buy a pursuant  software, etc.)
  3. An agency must complete and analyse the transformation plans then allocate necessary budget. After purchasing a new program with very good features, it is difficult to use on old computers/ hardware in the office. When you figure out the total cost, operating and hardware costs also should be considered.
  4. It is necessary to  prepare the employees for the innovations and transformation. The unwillingness of employees is usual if they hesitate to lose their jobs as a consequence of innovations and improvement. This concern is one of the major obstacles to progress.  To carry out a successful transformation it is very important to explain the benefits of  innovations to all employees.
  5. The agent owner must stand strictly against the problems that could appear during the transformation.  It is very critical to manage the reactions from employees and customers due to the possible hitches in the beginning of transformation. Therefore agency owners will need to allocate additional time to manage this process

The significant point of transformation is, agency owner has to believe the necessity of innovation and changes. You have to take this decision without hesitance. Thus, you can easily focus and solve possible problems and troubles.

Although all these efforts and costs, why do the agencies have to do these transformations and improvements ?

Rıza OYGUR

December 2020