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WHY THE WORLD OF INSURANCE NEEDS AUTOMATION

Josh Ayres, head of emerging technologies, IPI


A big challenge for the insurance sector is maintaining customer loyalty. With competition fierce, the key to market differentiation often lies in the experience customers have with a brand. As the mouth piece of an insurer, the contact centre – the go-to place for claims, complaints, renewals and cancellations – should be a focal point in the bid to improve customer service.

In order to keep customers happy and loyal, insurance contact centres should look to adopt technological advancements such as automation which are revolutionising the service being offered to customers in the insurance sector. The likes of chatbots and other automated tools will not only speed the customer’s journey to an efficient resolution, but this technology will also improve the employee experience. Since happy agents make happy customers, it would be unwise not to seize the opportunity that automated technology presents.

Fear not the chatbot

Whilst there are some fears that automation could jeopardise jobs, adopting new technology is actually one of the best ways in which insurers can improve both the customer and employee experience.

Automated technology in the insurance sector is already seeing widespread adoption. With a distinct rise in the volume of emails received, it’s estimated that 94% of insurance providers will enable an online chatbot by 2020, up from 44% in 2018. By speaking with a chatbot on the insurer’s website, customers can update their address, for example, without having to pick up the phone, and even if they do, AI tools can guide them through the easy parts of the call.

These automated tools are also able to take on some of the contact centre agent’s workload by completing the more mundane tasks, such as updating contact details. Not only does this reduce the overall call handling time – a key metric in the contact centre – but it also frees up the agent who will have more time to spend with the customer on the more complex matters.

Having their journey simplified and more efficiently dealt with will not only ensure a happy customer, but also reinforces their loyalty, a key marker of success in the insurance sector.

Better customer service

The customer experience is the top priority in the world of insurance, especially when a customer is calling regarding a claim. If the customer has been in a car accident, or there’s been some damage to their home, for example, chances are that emotions will be running high. In these situations, the response of the agent in the insurer’s contact centre is critical not just in dealing with the customer’s immediate concern, but also can influence that customer’s future loyalty.

Dealing with calls efficiently and resolving problems effectively the first time around should be the main goal of insurance call centre agents. In fact research has shown that customers don’t like to be kept waiting on the phone, and 76% of consumers admit that they are likely to switch brands due to a bad customer experience.

By allowing the agent more time to interact with the customer on complicated matters, staff are encouraged to provide a better, more personalised customer experience, especially if they are rewarded for their efforts. Customers will appreciate this attention to detail and will feel like they are really being heard, rather than being pawned off to a robot.

By improving customer service on intricate matters, combined with a shorter wait time thanks to the bots, insurers develop a good reputation amongst customers, encouraging loyalty in an increasingly competitive marketplace.

Happier agents

The customer experience is, however, no longer the only important factor to consider. The employee experience is another facet of the industry that automated technology can help improve.

Keeping up morale and productivity can be tough and employee engagement has become a top priority for contact centres. In an effort to boost the mood, some insurance providers are trialling a four-day working week with no loss of pay for its staff in an effort to improve productivity, staff wellbeing and, as a result, the customer experience.

Introducing automated technology can also help achieve these goals. Speech analytics is a tool that can be especially beneficial to lightening an insurance agent’s workload. Voice recognition software and speech analytics are capable of unearthing useful information that might not have been spotted at first sight – particularly beneficial when dealing with insurance claims. For example, thousands of hours of call recordings can be analysed in seconds, with metrics such as phrases, anomalies and errors identified instantly. In short, speech analytics can help improve the employee experience by doing everything from reducing stress on agents and improving their job satisfaction, to highlighting the strongest performing agents and increasing employee retention rates.

Whilst automation technology can be used – and is being used – to support and improve the customer experience in insurance, it can also help achieve a more well-rounded contact centre. The employees are one of the most crucial aspects of the insurance contact centre, especially in delivering that all-important world-class customer experience to a customer calling with a claim or complaint. Helping employees with technology such as speech analytics that makes their job easier and more satisfying will not only make for an overall improvement in the working environment and office culture, but will also ensure that they can deliver on the customer front to keep customers loyal to their insurance provider.

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RISK VS REWARD: IS AI TAKING OVER?

Xavier Fernandes, Analytics Director at Metapraxis

A study by Oxford University academics into “The Future of Employment” in 2013 prompted apocalyptic headlines which stated that in the future 40% of jobs will be automated thanks to advancing technology.

The researchers subsequently claimed that the truth was in fact a little more prosaic; rather than facing complete automation, the research found that 40% of jobs faced some aspect of automation in their activity. So with new ‘AI processes a likely reality for almost half us, what does that mean for our current roles and should we be worried?

 

The fourth revolution?

The first industrial revolution saw machines replacing muscle, both human and animal. The second and third saw electrical power, mass production and computerisation revolutionise the job market. Now, with daily headlines of AI as an employment superpower, there is some concern that AI is bringing a fourth revolution, and with it, unknown circumstances.

This ‘fourth industrial revolution’ is defined by replacing brain power with machines. Our thinking capacity is what inherently sets us apart from other species, so it’s not surprising that any encroachment on it triggers some existential angst.

 

Xavier Fernandes

Evolve to reap the rewards

While many businesses still don’t fully understand the capabilities of AI, those who fear its development are, instead of embracing it, missing all the benefits that it can bring to the workplace. Businesses that utilise AI appropriately are seeing vast improvements across their entire value chain; better customer experience, reduced costs, and more insightful analysis to support management decisions.

AI is particularly useful for supporting tasks with repetitive activity, for example, performing financial checks and assessing large sets of data within financial services firms. AI performs particularly well within this context, spotting outliers before a human expert would notice them, allowing impending problems to be flagged and avoiding costly mistakes.

There is also an increasing focus on maximising customer lifetime value through the use of AI. Being able to predict existing customers’ needs as well as track trends in their financial circumstances is supercharging the old cross-selling approach with testable, predictable outcomes.

With potential benefits like these on offer, management teams of innovative financial services are increasingly relying on AI to help them with some of the heavy-lifting of analysis. Using advanced data capabilities and learned behaviours, AI analyses market trends to provide predictions of future performance. This insight is invaluable and allows management teams to change direction and  correct any problems accordingly. This offers a huge advantage over those that have not adopted such tools.

 

Supporting the workplace

Algorithms and AI are typically ‘smart’ at doing one, tightly-constrained task, but they can be less helpful with many of the activities that humans find straightforward. In most white-collar jobs, automation tends to replace certain tasks in the job, rather than the role in its entirety, as the need for human intelligence is still highly necessary. In particular, we still need human input to first challenge, and then synthesise, this information before taking action. Employees should therefore work with the business to proactively identify what areas of their role could be automated, so that they can focus on the areas that add real value to the business’ commercial goals.

Challenging AI is certainly still important. We know that algorithms can be much better than humans on certain, bounded tasks. However, many algorithms rely on existing data sets to build their understanding. As a result, when a business unit has ‘symptoms’ that fall outside of that body of knowledge, the algorithm may suggest the wrong course of action with costly results.

Indeed, even with plenty of data, algorithms will reflect any biases the data set contains. We’re seeing this with some legal sentencing algorithms where there is evidence that they are treating disadvantaged people more harshly. Getting the answers to why and how far we should trust our algorithms should therefore become an everyday part of any job affected by AI.

Rather than depending entirely on AI for all decisions, workers should be taking all these new, AI-generated insights and using them to complement the human decision-making process. No manager of a complex business ever has enough time to sieve through all the analysis available, but with AI driven algorithms able to flag up any issues and indicate where action needs to be taken, we may find that we have some AI ’colleagues’ who will cover our backs and suggest innovative options. Yes, there will be times when the algorithms get it wrong, but as long as we’re watching out for those, the future is bright.

 

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HOW TECHNOLOGY IS FUTUREPROOFING STOCK MARKET TRADING

stock market

Tony Shaw, Executive Director, London Office and Head Sales UK & Ireland at the Swiss Stock Exchange

 

Markets are shifting, there’s no doubt. Amid all the disruption and volatility from the past year, the Swiss Stock Exchange asked traders about what they expected in 2020 and beyond in our industry survey. The findings point to a rise in digital to help traders content with external forces.

 

First and foremost, traders are enthusiastic about what digital assets can offer.

Two thirds of traders polled said they’d had a marked rise in interest from their clients for digital assets and crypto-products. Given the interest, traders are increasingly bullish about the potential of these products – so much so that 80% have predicted an increase in overall demand in the long term. Market users believe these assets will help generate cost synergies and streamlining trading and settlement processes by creating efficiencies and ultimately reducing costs.

Our 2019 results reflect what traders have told us when it comes to digital assets and products. Last year, we saw significantly higher trading volumes from products with crypto currencies as underlyings. Overall volumes grew by +8.5% over 2018, but the increase in crypto products alone was +17%, reaching CHF 518.2 million ($534.54 m). There was a year-on-year increase in the number of transactions, as well (+21%): 19,636 trades in total.

The potential digital assets hold is clear – evidenced by the building of the SIX Digital Exchange (SDX), a fully integrated issuance, trading, settlement and custody infrastructure for digital assets.

According to traders, artificial intelligence (AI) is expected to bring further benefits to market operations.

Two thirds of our survey respondents anticipate AI will create more opportunities for the traditional equities business, while a similar number expect it to reduce the cost of trading. Innovation in AI is already – and will continue to be – a key driver in making our industry more effective at withstanding future risks and challenges both within and beyond the market itself.

In Europe, there is growing momentum behind calls for shorter trading hours – this trend was reflected in our survey as well.

Industry groups such as the Investment Association are advocating for stock market trading hours to be cut from 8.5 to 6.5 hours to open the industry to working parents and women who cannot commit to such long workdays. We found traders were largely supportive of this, with many saying that it could even facilitate operational benefits. The roll of AI is clear here in improving efficiency while minimising time wastage: 36% of traders said the introduction of shorter trading hours would prompt greater market liquidity.

Beyond the market itself, geopolitics continue to shape wider market sentiment.

It comes as no surprise that four fifths of traders said their strategies have been – to some extent – influenced by Donald Trump’s tweets. Interestingly, only 39% of those polled viewed Brexit as an influencing factor in trading activity, while three quarters believe the US election will drive trading activity in 2020 and 65% acknowledged trade wars would also have an impact.

More broadly, traders are split on the state of the global economy – 58% are bracing for a global recession while 42% predict stable macro-economic conditions over the next three years. What seems clear is that whatever happens in the wider economy, traders are making headway with new technologies that can improve their strategy, efficiency, and overall market health.

 

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