RPA In Insurance: Definition, Benefits, Use Cases & Case Studies
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The insurance industry was one of the most traditional, cautious, heavily regulated, and non-receptive to major changes. But with the shift of the customer base towards app-based transactions and heavy commoditization of insurance products, insurance organizations are forced to digitize their operations completely. With the explosion in the number of customer interactions across multiple channels, the ever-rising expectations of customers for instant query resolution, and increasing competition, insurance companies are moving towards adopting robotic process automation to automate repetitive tasks, which reduces their costs significantly.
- 80 % of insurers acknowledge the need for digital capabilities.
- Yet, 99.6 % of those surveyed found it difficult to implement digital innovation.
- The insurance industry has the potential to automate nearly 50-60% of the back-office processes by 2025, resulting in 66% time savings.
It's unfortunate, but not all insurance companies are able or ready to change. Insurers are finding it difficult to embrace digital transformation because they have so many old systems and sophisticated business processes in place, which are hard to adapt to technological advancements.
This is made worse by organizational silos that prevent them from seeing the big picture. Insurers, brokers, and agents are turning to Robotic Process Automation (RPA) as a solution to these issues.
What does RPA stand for?
Robotic process automation refers to a program that can be set up to carry out tasks in the same manner that computers and applications do. When you talk about a "process," you're talking about the task you want to get done. "Automation" does exactly what it says on the tin: it takes care of itself.
Robotic process automation can be accomplished through the use of software or hardware systems that can be used for a wide range of applications. Because of this, the cost of labor may be greatly decreased and the level of efficiency enhanced by speeding things up and reducing human error.
Automated processes, including receiving forms, providing receipts, confirming form accuracy and completion, storing the form in a file, and amending an excel spreadsheet with form data, can be programmed into software or robots. Individuals who have to perform repetitive, straightforward tasks can benefit from the use of RPA software like Nanonets.
Read more: Intelligent Automation vs. RPA
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What is RPA in Insurance?
25% of the insurance industry's activities will be automated by 2025.
In the insurance industry, RPA has a major impact on automating insurance, travel, and life insurance due to the presence of highly standardized processes.
So how does RPA help the insurance sector by automating these processes?
Most of the insurance tasks are rules and process-based, which makes it easier to automate them using robotic process automation. Using RPA for insurance claims might speed up the data processing procedure as it gathers data from a variety of sources and provides the most efficient strategy to handle claims.
Customers will have a better experience since RPA bots can quickly register and respond to client complaints. As a result of insurance automation, customers feel that the company is always available to them.
Also, robotic process automation (RPA) in the insurance business has resulted in a reduction in human errors in insurance processing. The use of bots can limit the risk of human error because they can only do particular tasks.
RPA bots can process papers, talk to customers, verify KYC, and do much more in a more efficient manner than a human employee would be able to accomplish. It boosts staff output and results while bringing in new clients and prospects.
The use of RPA in the insurance industry has already been proven to be beneficial, so let's look at where it genuinely helps companies.
Read more: Guide to Insurance OCR.
How can RPA help in insurance?
82% of employees welcome the idea of having an automated software solution to name and tag office documents. (M-Files, 2019)
The insurance industry is a paper-heavy industry. With a lot of insurance documents to handle, like customer account opening, bank statements, claims,etc., it becomes easier if they use intelligent document processing software to automate document processes.
Many insurance businesses have begun using RPA to improve their data-gathering processes, such as:
Managing Insurance claims
By 2018, claims review was already being considered one of the biggest processes to be automated. 30% of insurers were considering robotic process automation for this task.
By automating the whole claim process from the moment, a loss is reported, through adjustment and settlement, RPA bots save time and money for everyone involved.
Automated claim processing can reduce manual workload by 80% and save more than 50% of the time. Interested to do this for your organization? Try Nanonets for free, or book a call with an automation expert.
RPA can help in automating all aspects of claims processing:
- Source integrations for claims
- Identifying fraudulent claims
- Extracting data from customer IDs
- Data Integration
Claims inspectors can focus on more critical faults and exceptions if insurers automate their high-volume claim filing processes. Typical claims are dealt with quickly and efficiently, allowing staff to devote their time and attention to more important tasks.
Read more: How to get started with Accounts Payable Automation
Underwriting & Pricing
Traditional underwriters had to assess a variety of data sources to determine risk and provide clients with the proper rates and policies. In order to speed up decision-making, RPA Insurance bots can collect complex data from various sources, identify fraud, estimate the loss, update data fields on customer profiles and analyze customer behavior to provide a correct estimate of underwriting.
The insurance industry is one of the most heavily regulated industries. Insurers have to abide by strict laws while ensuring error-free processes for the government and the customers. RPA in insurance plays a vital role in ensuring regulatory compliance for insurers by automating compliance processes and reducing the scope of manual errors.
With completely rule-based processes, RPA insurance bots ensure high accuracy of data, maintenance of changelogs, a complete library of data entries, and generate automated regulatory reports for stakeholders. RPA insurance bots make the entire audit process hassle-free for all the involved parties.
Call Center Support
Customer service representatives can benefit from the assistance of digital workers. Real-time service inquiries can be handled by human-assisted chatbots. Using RPA in insurance, it is possible to collect and store customer and product data more quickly, improve communication amongst employees, and improve policyholder satisfaction.
To reduce customer time to resolution, RPA in insurance can be trained to interact with customers 24x7 and guide a customer to self-serve resolution articles, and collect customer information for agents to review afterward.
Form registration is a redundant but necessary task in the insurance space. RPA can automate and assist process completion in just 40% of the actual time taken, with half the workforce required.
Form registration is a mandatory action that requires customers to fill out a painstakingly long form with multiple fields manually. This data has to be digitized, which is often done manually by full-time employees.
When optical character recognition (OCR) and RPA are integrated, insurers may automatically understand the text from registration forms and direct the information to the necessary workstreams. As a result, insurance claims are processed 40% faster and with 0 errors.
Read more: How to extract data from forms?
Administration of Insurance policies
RPA systems can analyze customer emails and classify data using various RPA in insurance systems can classify customer emails using deep learning, computational linguistics, sophisticated OCR, and analytics.
Regulatory and legal criteria can be accomplished while retrieving data, updating systems, and engaging with humans to complete orders and affirm.
Innovating new products
The insurance industry is highly competitive, requiring them to innovate at a higher pace. In order to support their innovative product suite, insurance organizations need to integrate the use of RPA Insurance Services to provide immediate customer satisfaction as compared to competitors.
For example, photos of the damage to a car can be automatically assessed to expedite auto insurance claims and avoid the need for an adjuster visit for image analysis.
Policy cancellation involves performing multiple checks like tallying inception date and cancellation dates, checking all policy terms and providing cancellation confirmation to customers. RPA bots can be trained on custom rules to carry out the policy cancellation process smoothly.
Read more: Guide to insurance automation.
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What are the benefits of using RPA in insurance operations?
Using RPA, insurance companies may streamline back-office operations and enhance customer service while also enhancing employee morale. Employees shouldn't be forced to perform useless data input, after all. The following are just a few of the many advantages of automating insurance processes with RPA:
Quicker processing of insurance claims
Quote generation time for insurance agents in California was cut from 14 days to 4 minutes using automation.
Workers in traditional claim processing acquire data from numerous sources and shift it into other systems. As a result of the robotic process automation in insurance bots, customers who make claims now receive a faster response when they do so.
Read more: What is online ID verification?
Greater client satisfaction
RPA can help insurers speed up a wide range of data-intensive procedures, from onboarding new customers to canceling policies. In order to reduce time and meet the needs of customers, RPA is capable of switching between multiple systems and transporting data automatically.
Software like Nanonets can reduce the customer onboarding time from days to minutes, which leads to fewer wait times. See how Nanonets can help you improve customer satisfaction. Book a call with our automation expert.
More accurate data
Automating manual processes with RPA reduces the likelihood of human error. RPA enhances data dependability, which is particularly important for regulatory compliance. Nanonets have an accuracy of >95% while processing documents.
Rapid cost reductions
Increased productivity and lower costs can both be achieved through the use of robotic process automation (RPA). Reassigning employees to focus on more vital projects can also help companies flourish.
Protecting financial investments
To make room for newer technology, robots can be used to extend the useful life of older systems that will be retired in the near future. In comparison to more traditional IT initiatives, these ones can be set up significantly more quickly.
Opportunities to promote each other's products
Chatbots, a type of RPA technology, can provide customers with personalized product recommendations. New business innovations such as instantaneously customizable life insurance and on-demand property coverage can both benefit from RPA's versatility.
Improved work-life balance
Workers spend an average of 50% of their time creating and preparing documents. (Nitro, 2020)
With document automation, organizations can save a lot of FTE time. A wide range of manual data entry chores can be eliminated by RPA in insurance bots using sophisticated document processing. This allows employees to focus on more value-added activities. As a result, employees' spirits soar throughout the company.
Read more: How to reduce manual data entries?
Want to use robotic process automation? Check out Nanonets workflow-based document processing software. No code. No hassle platform.
Top RPA use cases in insurance
Claim processing necessitates gathering vast amounts of data from many sources. Current claims systems are inflexible and lack functionality, resulting in extensive human processing.
RPA can reduce human intervention in insurance claim registration. Customer details are validated against internal policy details, customers are notified with claim numbers, and requests are forwarded to the proper investigative teams.
By integrating RPA for Claims Documents Processing, insurance companies can save up to $14k per year in the process.
Outcomes include increased customer satisfaction and savings. RPA in insurance allows for the integration of many sources of claims processing data. In the insurance market, RPA may automate manual activities, including data extraction, sophisticated error tracking, claim verification, and data integration, therefore speeding up the process and improving customer experience.
Read more: Invoice Automation
When it comes to fraud prevention, robotic process automation (RPA) can be of immense help.
American insurance companies lose approximately $40 billion a year to scammers.
Considering that many organizations still rely on outdated rule-based systems incapable of identifying sophisticated fraud schemes, the figures seem understandable. Aside from that, AI-powered fraud detection systems help to increase the accuracy of human analysts' judgments by providing them with relevant data to consider.
Computer systems built on machine learning and deep learning as their basis can find recurrent patterns in data with relative ease. Due to this characteristic, they are excellent candidates for catching unusual behavior in systems or among individual customers in a variety of situations.
An algorithm that has been pre-trained on the computer and network usage statistics of employees can keep tabs on their day-to-day activities. In cases where a deviation from the norm is detected (e.g., multiple requests for unauthorized access), a security system can flag the offender and notify the appropriate authorities for further investigation.
To accurately assess the risks connected with new customers, AI fraud detection tools can be used to do fast, automatic background checks.
Read more: How to prevent vendor fraud?
Underwriting is another area of insurance that can benefit from automation. It involves obtaining and analyzing data from a range of sources, such as:
Risks to Health
Tobacco use will raise an applicant's mortality charges and hence raise the applicant's insurance premiums, especially when compared to the applicant's current age.
Limits on a budget
A death benefit cannot exceed $10X if the applicant's current net worth is $X.
How does a third-party company determine an applicant's credit rating?
Duplicate Rules and Regulations
Robotic Process Automation reduces underwriting time by automating the data collection process from a variety of external and internal sources. Automating the foundation of the process, it can populate numerous fields in internal systems with relevant data, provide a report or make recommendations while evaluating run loss.
Insurance underwriters are responsible for assessing and analyzing the risks associated with insuring individuals and their property. Insurable individuals' and assets' histories are gathered as part of the underwriting procedure.
The RPA bots can carry out the following as they have artificial intelligence and machine learning incorporated into them; for example, they perform like,
- Fill out the necessary fields in the system's database.
- Data can be accessed from both internal and external sources.
- Analyze the number of failures.
- Investigate a customer's past to determine the most appropriate pricing strategy.
Finally, the insurance industry's underwriting process will become more efficient, and underwriters will be able to focus on more challenging jobs.
Several businesses may offer your items at a lower price (one that is theoretically impossible to match) in an effort to increase sales. RPA insurance bots gather and aggregate pricing data to see if your products are being offered online in an unethical manner or for less than the MSRP you've established.
Rating, quoting, binding, issuing, renewing, and endorsing are all aspects of insurance policy administration. Furthermore, you must be aware of the costs associated with maintaining an insurance policy administration software system if you are using one. The insurance sector often has a hard time scaling up when its customer base develops because of these issues.
Using RPA, tasks like credit control, tax compliance, and regulatory settlements can be automated. The whole procedure is sped up significantly using RPA, which navigates across various apps and saves significant time.
Process & Business Analytics
Insurance service providers must strive to give their consumers the finest possible service.
It's tough for insurance agents to track or measure operational efficiency and find areas for improvement because of the sheer quantity of paper-intensive and operational activities.
When RPA is utilized in the workplace, tasks can be easily executed and tracked with higher efficiency. The use of RPA in audit trails helps to ensure regulatory compliance, which in turn aids in the optimization of the overall workflow. With a customer-centric approach, RPA increases customer response times and streamlines corporate procedures.
Read more: What is process automation?
Sales and Distribution
Sales and distribution in insurance can be made easier with RPA. It is possible to automate and set up a variety of activities, from creating sales scorecards to sending notifications to agents.
Finance & Accounts
It's common for insurance agents to deal with billing, payroll, and other financial matters. Many insurance agents find it difficult to deliver error-free customer service because of the volume of data they must process.
With RPA bots, repetitive tasks like copying and pasting, filling out forms, and sending out notifications may be completed with minimal human intervention. Additional benefits include reducing insurance policy footprint and financial transactions, as well as alerts for questionable claims.
If you work with invoices, receipts or worry about ID verification, check out Nanonets online OCR or PDF text extractor to extract text from PDF documents for free. Click below to learn more about Nanonets Insurance Automation Solution.
How to scale RPA in Insurance with Bots?
We’ve established the importance of RPA in insurance services. RPA can enhance insurance services by improving productivity and efficiency and reducing costs. Robotic process automation in the insurance industry can be included but is not limited to the following tedious tasks :
- Data Extraction from forms
- Data Validation from multiple sources
- Data Entry into CRM and other major systems
- Data Integration from multiple customer channel sources
- Flagging errors and mismatches in the data
- Conducting calculations on a large scale
- Automating approvals, verification, onboarding, and query resolution systems
- Generating automated followups
And more. Let’s dive into how to implement RPA in insurance and find the best RPA software for insurance in the following steps.
How to find the best software for robotic process automation in insurance services?
With a plethora of tools available in the market, it is a hard decision to choose the best out of the lot. The steps to finding the best tool are understanding your requirements in great depth and then finding the best fit according to your requirements.
Step 1: Understand the Scope
Automated bots are the simplest and most frequent types of bots, designed to help automate repetitive, time-consuming, and rule-based operations. In order to use RPA in insurance services, you need to identify the processes that are repetitive, completely rule-based, and require no human intervention so that they can be automated effectively, like form registration, customer onboarding, underwriting, pricing, etc. Ask yourself the following while deciding the scope :
- Is the task repetitive?
- Is it a standardized process?
- Does it require any human intervention?
- Will this task free up employee time?
- Is this a high-volume task?
Understand which tasks fit into these buckets.
Employee productivity, customer happiness, and data quality can all benefit from the use of RPA in insurance, which frees up employees to work on more important activities that take advantage of human characteristics like their proclivity for interpersonal communication.
Step 2: Define a strategy to scale it across organizational teams
Once the robotic task has been automated, scaling across the organization is the next natural step. When your staff is well-trained, they have greater freedom to think creatively about ways to improve the company's productivity and customer service.
Involve all the team members to collectively try out and be a part of the decision-making process to enhance the adoption of the new technology. Make it clear that the use of the RPA in insurance is not to replace employees but to facilitate their work. During this step, chart out the RPA tools and map them across the following feature sets.
- Ease of use - Is the software easy to use? Is it intuitive to use?
- Integration - The new software must integrate with your existing tech stack to ensure smooth adoption.
- Accuracy - Robotic process automation in insurance is used to enhance accuracy. Try to check the accuracy of your documents on different software to see what suits you best.
- Customization - Your company might have different formatting styles from other companies. You need to ensure that the software is flexible enough to allow you to capture and analyze data from any kind of document.
Also, among the tools available to achieve this goal are those that enhance reporting or track tasks more precisely. Consider how reconciliation reports created by RPA insurance bots might help speed up the process by notifying about a variety of potential bottlenecks in the workup process or by quickly identifying past errors and omissions.
Such bots are deployed in a manner similar to a game theory strategy, which assumes infinite resources. When faced with such circumstances, employees are more inclined to consider how they can best help the company achieve its goals and take action as a result.
Step 3: Train your entire workforce
In order to derive the maximum benefit from implementing RPA in insurance services, more employees need to use it. Therefore, once the technology is introduced into your systems, ensure your entire workforce, IT, Customer service, tech, and more are trained to use it regularly.
Step 4: Broaden the scope to make data-driven decisions
Robotic process automation can be used to drive data-driven decisions on a large scale. Multiple insurance services tasks require calculations, validation, or data integration which can be missed by humans. RPA insurance bots can collate data from all your data sources and provide you with a single view of information to enable better decisions.
In order to help employees, software robots can aid them in broadening the data points that can be evaluated. As a result, this stimulates the use of data in unique and creative ways. More precise and accurate decisions are likely to be made as a result.
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Nanonets for RPA in Insurance Services
Nanonets is a no-code, workflow-based intelligent document processing software best suited for organizations looking to automate every aspect of document processing. Nanonets is used by leading banks around the world to automate customer onboarding, KYC verification, invoice processing, credit underwriting, and approvals, which in turn enhance customer experience.
Nanonets is an easy-to-use and intuitive software that has a zero learning curve. Being easily integrated, it fits into almost any tech stack without any hassles.
Nanonets provide>95% accuracy in processing audit documents and can process documents 10x faster than manual FTEs. Interested? Try Nanonets for free. Or set up a call with our automation experts to see how you can improve your processes.
Read more about Robotic process automation on Nanonets Blogs:
How can insurance organizations increase efficiency with RPA?
In the Insurance niche, RPA automation can be widely used to work with old systems, automate duplicate activities, and even acquire data from outside the niche. RPA automation. It helps increase output while also increasing customer service. RPA can be utilized in new endeavours and underwriting claims processing, business and operational analytics, and more.
Is RPA synonymous with Intelligent Automation?
An important component of Intelligent Automation is RPA. What makes RPA software "intelligent" is the integration of AI technologies. Robotic Process Automation (RPA) alone isn't enough to automate complicated business processes.
Is there a cost to using RPA?
There's a lot of room for debate here. Students, small enterprises, software developers, and academics can all take advantage of the industry-leading RPA platform, which is offered for free to everyone.
Does RPA necessitate knowledge of programming?
RPA does not require any coding to use. Is it simple to pick up RPA's concepts? Yes. A CIO isn't required to succeed here. Core team members with both development and IT skills, working with business users to plan and optimize automation, produce the greatest results for RPA adoption in the company.
What distinguishes RPA from cognitive intelligence, and how does it differ?
RPA focuses on tasks that are easier to perform. Only physical jobs that don't require knowledge, awareness, or insight—tasks that can be done by codifying rules and telling the computer or software to act—are taken away by this.
Cognitive automation interferes with human knowledge and other human traits that go beyond the ability to do a task. This type of cognitive automation is able to cope with natural language thinking and judgment, as well as construct context and provide insights. That's why they are so different.
Cognitive automation, on the other hand, isn't yet ready for a prime time like RPA is. A wave of powerful cognitive automation solutions has yet to materialize in the market, and not many firms are adopting them.