Cloud Based Solutions have improved and even transformed many industries over the past few years. The hallmarks of any decent cloud service include flexibility, versatility and cost savings. The benefits of the cloud have surely trickled down to the much important Insurance Sector.
The scope of insurance is virtually limitless these days. Just imagine the motorbike or car that you may use for your everyday commute. You simply can’t own and use them without having proper insurance. If you are ignoring this requirement, you are putting yourself at great personal and Financial Risk.
To expand the same example further, the process gets far more complicated when assets of a higher value are involved such as home ownership. In most such cases, insurance will again be mandated as per law and you can’t simply do away with it.
Glimpse of Insurance Sector
Since a lot of assets need to be insured as a Legal Obligation, the consumer or end user does not have any choice in the matter. However, a person seeking insurance can choose from a host of insurance companies for the service. This is where the competition gets fierce.
Each insurance company tries its level best to woo customers on its side with the best offering. When it comes to insurance, the mere financial impact of this service is not the sole criterion for selection. A high Quality Customer Support and service are an important component of the whole selection process.
Overview of the Cloud Industry
The overall performance of cloud computing industry has shown strong growth over the past few years and the situation is quite likely to remain as such. Just to give a better perspective, it is estimated that the size of global cloud computing industry will touch a whopping $300 BN by the year 2021.
In order to give you a peek into the future, it is estimated that by the year 2022, nearly 90% of all global businesses will deploy some sort of a cloud solution. This estimate lends further support to the notion that the growth of Cloud Based Solutions is showing no signs of slowing down in the near future.
How Do Cloud Computing and Insurance Match Up
Insurance is one of the most fiercely competitive service industries in almost all developed economies. It is partly due to the mandated nature of having insurance cover as part of the ownership of many assets. Even otherwise, citizens of developed economies have both the means and inclination towards insurance as well.
Also Read: What is cloud insurance?
This translates into a market size of millions of customers who are in search of not only a good insurance company but also someone who takes them along each step of the journey. At times, even the insurance premiums may go in the backdrop and service quality may take center stage.
Due to the immense competition within the industry, each company keeps tweaking their offering to attract more customers. These efforts are aimed at both new and existing policy holders to entice the latter to switch over. Each insurance company has to remain on its toes and keep a watchful eye on competitors.
Once a business threat or opportunity has been identified, an under writer has to act fast. If the company maintains a cloud based infrastructure, it will ensure organizational agility. Tweaking your product over a single cloud based network is much more convenient and efficient.
The changes that are made to an insurance product hosted over the cloud will have to be made over a single location and all those changes will take effect all across the organization. In a traditional infrastructure, even minor tweaks can give rise to an administrative nightmare.
In a cloud based solution, all the hardware is the sole responsibility of the Cloud Service Provider (CSP). In addition to procuring the hardware, its maintenance, up gradation and cyber security are also managed by the service provider. In exchange for all this, the insurance company will pay a usage fee to the CSP.
This removes the administrative hassle for an insurance company of maintaining an elaborate in house hardware to manage all the products and thousands of customers. This frees up both financial and administrative resources of an insurance company and the same can be channelized towards the core area of business.
Reduced costs generally translate into improved financial viability and stability. The benefits of any cost reductions can also be passed onto the policy holders to retain them and attract new potential clients. The cost related benefits of a cloud based infrastructure are both short and long term.
Insurance and leasing are two financial services that generally involve extensive paperwork. In addition to filling a plethora of forms, the customer generally remains confused over what’s being done right and which documents or papers would be sent back for amendments.
This entire process is two way and involves a lot of to and fro movement of information and paperwork. The dated way of executing the whole process not only slows the flow, it also tends to frustrate the customer due to the uncertainty whether the entire effort would be approved or otherwise.
A cloud based solution makes this whole process very inclusive for the insurance seeker. All the forms, paperwork and checklists can be served to the customers over the cloud at their doorstep. The customer will remain an integral part of the whole process flow and will not get frustrated at any stage.
Insurance companies can easily serve each customer with an intuitive interface that keeps them up to date about their existing insurance plan (if any) or progress of any policy under process. The customer can also track the progress on the insurance policy or claim over the cloud based solution.
We live in the age of vast amounts of data. When this data is analyzed from multiple perspectives, it reveals valuable insights about existing and prospective customers. CSPs offer a lot of processing muscle which makes playing with vast amounts of data quite manageable.
All the computing and processing resources are provided by the CSP and if an insurance company has quality data analysts, it can extract valuable trends and insights about its existing and prospective customers. These findings will enable an insurance provider to tweak its existing offerings and design tempting new ones.
The insurance industry is quite matured by now as there are plenty of such companies in the market. It is a universally accepted statistic that securing a new customer from scratch costs way more time and resources as compared to retaining an existing customer.
Well, the key to retaining existing customers is keeping them happy. So long as a customer has a voice, things do not generally take an unpleasant turn. There may be customers with certain genuine grievances that need to be heard and resolved on priority.
The cloud based environment is ideal for delivering a superior customer service experience in a cost effective manner. The cloud is an effective delivery vehicle for customer relations such as support, live chat and interactive sessions with customers.
The cloud native support mechanism will not only act as a problem resolution tool, rather it will also enable the insurance company to channelize the same resources towards market development and reaching out to new potential leads generated by analysis of vast data over the cloud infrastructure.
The cloud is a very suitable ecosystem for the insurance industry as the agility and versatility of such solutions aligns quite well with the goals of the insurance industry. Cloud Based Solutions will not only open new avenues for the insurance industry, but also unlock even better offerings for seekers of insurance cover.