RPA Means Better Processes and Improved Productivity for the Insurance Industry

Editor's note: To find out how the insurance industry is navigating shifts in demand due to the COVID pandemic, we recommend reading Hyperautomation and COVID-19: Navigating Changes in the Insurance Industry.

The insurance industry was one of the first to witness widespread adoption of robotic process automation (RPA). The industry’s repetitive, rules-based, and document-heavy business processes make it an ideal candidate for automation. Many companies are now experiencing tangible benefits from RPA and the technology has a lot more to offer.

Anyone involved in any of the key insurance processes— underwriting, claims registration and processing, policy issuance and renewals, or, even, month-end reporting—know just how many pieces of information from many different sources are involved. It’s an industry that relies on its back-office processes and those processes are increasingly inundated, slow, and inefficient. For many companies, the challenge isn’t acquiring new customers, it’s servicing them properly. Contact centers are at full capacity and struggling to meet demand.

The first steps

RPA has proven to be excellent at helping insurance companies to streamline business processes and automate transactional, administrative tasks. Analyst firm McKinsey estimates RPA saves 34% of an employee’s time in data processing alone.

Initially, insurance companies have focused their RPA efforts on high volume, non-complex processes that involved structured data—such as claims processing and forms registration—which include a good deal of manual data entry and data retrieval, as well as data gathering and collation. These automations delivered an extremely high return on investment (ROI) – under six months in most cases.

There has been some great learning through this initial phase. First, it is very rare that an end-to-end business process is automated. Instead, companies are using RPA to address the pain points and bottlenecks within the tasks and workflows that underpin the process. Simply automating boring and repetitive tasks like multiple log-ins and cut-and-paste between spreadsheets significantly frees up staff time. It also increases accuracy and data quality while speeding the process. Robots don’t get tired or make mistakes and they can handle a mountain of work very effectively.

By focusing on the most appropriate tasks within a process, insurance companies have been able to create operating models around automation and optimization. One insurer was able to apply the UiPath Enterprise RPA Platform to automate 70% of all tasks within the organization. This has demonstrated how RPA can easily scale and resulted in the RPA Centers of Excellence and Robotic Operations Divisions to drive deployment across an increasing number of processes. What started in claims, renewals, and financial transaction processing is now rapidly being adopted in underwriting, fraud detection, Know Your Customer, and compliance.

The results are impressive. For example, an organization employing 9,000 people, with an RPA team of 40 and a robotic workforce can expect over 1 million hours of increased productivity each year.

Beyond workforce efficiency and cost savings, RPA is an incredibly cost-effective way to extend the value and lifetime of legacy systems. The robotic technology works at the presentation layer of applications. It mimics human activities such as keystrokes and mouse clicks so RPA can be deployed with no other changes needed to your current information technology (IT) setup. RPA can be applied easily across disparate systems and applications—both internal and external—which increases business agility.

Download our report to learn more about how to streamline your insurance claims and processes with RPA.

The evolution of RPA in the insurance industry

RPA in the insurance industry has been maturing quickly over the last 12 months. Organizations are looking at ways to automate more complex processes. The integration of intelligent optical character recognition (OCR) with software robots has been transformational. Like many sectors, insurers receive a vast array of documents and processing them to the point of use is time-consuming and costly, often leading to inefficiencies and backlogs.

The combination of RPA and integrated OCR automates not only the onboarding of information to allow content to be automatically interpreted, but also to facilitate the seamless transition of a large percentage of communications directly into the appropriate work streams.

One large insurer has been able to reduce its onboarding costs by 91% and increased processing times by 600%. This has saved the company 2000 hours per month and cleared a backlog that affected service quality and customer experience.

The insurance industry is also undergoing an evolution in the type of robots being used. Initially, the robots were unattended – programmed to complete specific tasks and allowed to run automatically – and now there are more attended robots appearing. Attended robots can be thought of like personal assistants. They take care of finding data and delivering it to the employee when they need it.

For example, an attended robot can bring together all information on a customer and deliver it to the agent when that specific customer contacts your call center. Underwriting is also seeing more attended robots deployed to retrieve and collate all the relevant data needed to make faster, more informed decisions.

This doesn’t just apply to people. RPA is beginning to be integrated with chatbots. Insurers are applying RPA capabilities to allow robots to process requests from chatbots by digging down into the company’s systems, processing the data, and returning the appropriate information to the chatbot.

RPA: From compliance to intelligence

Insurance companies have been quick to notice that RPA can help with their compliance efforts. Each task undertaken by a robot is monitored and recorded at each stage, giving valuable data on things such as the number of transactions processed and exceptions identified. In addition to providing an effective audit, robots can deliver information to ensure that the organization stays on top of compliance by safeguarding data for accuracy and constantly monitoring to assure compliance changes are enforced.

This data also marks the next stage in the evolution of RPA. Insurers are now looking to combine RPA with artificial intelligence (AI) and machine learning (ML) to add intelligence into their automated processes.

With intelligent automation, analytics data collected from the software robot are used to re-engineer processes in a completely new way. It allows for a new level of innovation in both product development and service delivery. As a result, new facilities such as automated claims payment are becoming mainstream and insurers are able to improve their customer’s relationship with risk in new ways.

We’re still early in the journey to intelligent RPA but the signs are encouraging. An insurer has already reported a reduction of 91% in the cost-per-transaction using an intelligent RPA solution. Adding AI takes RPA beyond the automation of repetitive tasks to enable the solution to address those parts of the process that currently require human judgment leading to enhanced decision-making. In the highly competitive environment of insurance that translates directly into business agility, competitive differentiation, and increased customer experience.

Join us for our webinar Using Hyperautomation to Drive Efficiencies in Insurance to learn more about RPA benefits for the insurance industry

Mark Brittain previously worked in the UiPath insurance practice.