Automation is the holy grail for insurers. But in group insurance, achieving end-to-end automation brings great complexity and business risk. At Sentro, we believe that delivering great group insurance service involves striking the right balance between full automation and helping administrators to be more productive while retaining control of processes.
Let’s look at some considerations when deciding what to automate and what to streamline. Finding the right balance is the key to maximum productivity and customer satisfaction.
Why is automating group insurance so difficult?
Group insurers deal with high volumes. They aren’t dealing with updating one policy at a time which would be less complex to automate. Instead, they are dealing with updating hundreds or thousands of policies at a time. Automating this volume is much more complex.
Group insurance plans with thousands of employees on them. Different employees can choose different coverages. Employees come and go; salary and job role changes happen frequently – there is constant change that can affect insurance coverages. The variety of data conditions and responses to failure are extremely complex.
The other complicating factor is information handling. The employer must produce information about employee changes. That information must then reach the insurer. This is often via their broker. Timing and context about the changes can be ambiguous (Did we receive data twice for the same employee? What time range do these changes cover?). So often, a degree of sanity checking is required, and processes are wrapped around employee updating. For example, employee change information may be requested once a month.
Automation works best when:- The process is fully in your control
- The processing rules are simple and apply the same way to everyone
- The correction paths for errors are clear
- The processing rules do not change
In group insurance member maintenance, this is almost never the case. Insurers cannot successfully mandate a uniform processing method across all of their customers and partners (although some have tried!).
Risks to consider when connecting to customer systems
We are often asked “could Sentro connect to my customer’s HR system? So when a customer adds a new employee, we could be automatically updated?”.
While external system integrations like this are technically feasible, we always encourage customers to think through the operational implications of this, both for themselves, and for their customers.
Different customer HR systems – Your customers will run a variety of different HR systems, with different methods of integration for each. Are you prepared to offer a direct integration for every different HR system your customers run?
Information Security – system to system integrations between companies involve exchanging secrets such as API keys, testing connections, considering restricted IP address ranges, data encryption and authentication standards, and more. This takes time, effort and review to establish. How long will it take for your customer’s IT team to approve it? How long will it take your internal IT team to approve it? Are you building these costs into your assessment of the cost and benefit of offering an integration?
Data content, completeness and expected values – Can you retrieve all of the data points you need to create and assign insurance products from the customer system’s API endpoints? Does your insurance product cover only full-time employees, but the customer API sends data for all employees?
Data categorisation – Do all of your customers classify data the exact same way? Does that categorisation affect insurance products? If one customer calls casual workers ‘Contractors’ and the next customer calls casual workers ‘Casual Workers’ does your integration logic break?
Across many customers, it is not practically possible to require all of them to configure their HR systems the way you want them. It will not happen. They will instead ask you to work with what they already do.
So this could mean supporting many different integrations to different HR platforms, with customer-specific tweaks. That adds up to an awful lot of code and business logic to maintain. You would have to be very convinced of the actual benefit relative to the actual cost before going down this path.
Enhancing personal productivity
There are important steps that can improve administrator’s personal productivity, while also making life easier for their customer and partners.
Secure information exchange – There is a happy medium between system-to-system API level data integrations, and words and attachments in an e-mail that may be insecure. Offering a secure mechanism to exchange file-based member change information between insurers, customers and brokers can remove a lot of the uncertainty related to the shipment of sensitive information.
Bulk updating capabilities – The ability of your PAS to ingest high volumes of membership data, validate it, then apply changes to membership records is an essential tool for administrative productivity.
Streamlined processes – If your PAS can also streamline product assignment, policy documentation creation and online service onboarding as part of these bulk update processes, you have a real productivity winner. Creation of new or updated member documentation is always high on the list of operational pain points for group insurers.
Putting it all together – find the right balance
System to system integrations – Reserve these for the highest volume, least likely to change scenarios. Understand that establishing a system-to-system linkage an external customer is a major ask, and will involve security and process scrutiny. Really make sure that there are clear and tangible benefits to both you and your customer – because you will both be incurring an establishment and ongoing support cost.
Facilitate the process around data exchange – Help your customers and partners to provide information to you simply and securely. Accept that not all customers will be capable, willing or able to produce information in the format or the timeframe you would like them to.
Automate around reviewed and vetted data – once you have received and reviewed information and it is now in your control, ensure that your PAS platform can process it in the most efficient manner possible. You will achieve most of your efficiency gains here.
When you find the right balance in automation, you will see your performance soar.