Home > XtractEdge > Blogs > The top use cases and benefits of IDP in insurance
The post-pandemic period has been a challenging time for the insurance sector. They had to speed up digital transformation initiatives to provide service access to more customers. Customer centricity has been the highlighted factor for insurers to evolve as changed customers demand increased the importance of digitization, accessibility, flexibility, and individualization. New methods of communication, staff augmentation, and insurers’ intermediary models are some of the significant changes that occurred at the insurer’s end to keep up. Hence, solutions like Intelligent Document Processing in insurance became integral to the transformation.
IDP in insurance is the key to initiating digitization, and providers are fast embracing this smart solution to stay competitive in the market.
Data is crucial for any sector. For insurance providers, customer data plays a significant role while processing new insurance covers. Unfortunately, customers’ personal information is usually scattered in unstructured or semi-structured documents. Manual extraction of such data from records of varying formats and domains only adds to the operational time. To speed up the process and provide services to more customers in a limited time, insurers need an intelligent automated solution.
Intelligent Document Processing is the right tool to get started as it converts unstructured/semi-structured data into structured and usable information. It speeds up the long-haul process of document processing and data extraction, allowing insurers to serve more customers at the same time. IDP in insurance provides end-to-end automation solutions to document-centric businesses, like banks and insurance companies.
According to a claims digital study by Gartner, 60 to 70% in the US are of the view that they are reasonably implementing some of the latest digital tools, which presents enables them to process the claims quickly. Hence, companies have been using them, but they need to be applied significantly to make faster decisions and solutions.
But only a fraction of this data proves valuable for the insurers to make decisions. Since every step in the insurance process is data-centric, primarily depending on documents, insurers face a tremendous challenge in extracting the exact information from handwritten documents, PDFs, or images. Given the heavy volume of customer documents to process and mine for data, the task gets more difficult, long-haul, and laborious. With more documents to map, resources find it hard to keep up and eventually delay the entire process. And the chances of missed information or errors while picking the data are high. Hence, a manual approach to data mining in the insurance sector only adds to operational inefficiencies.
For insurance companies to effectively meet customer demands, IDP solutions can be the most valuable resource. IDP for insurance claims leverages the power of AI and Automation to reduce the claim process time and speed up data extraction so more claims can be processed in lesser time than before. IDP uses advanced technology to quickly identify different types of documents and intelligently extract the required insights from unstructured datasets. It allows employees to focus more on improving customer relations while letting the tech-enabled platform cater to recurring tasks.
Typically, an Intelligent Document Processing platform comprises four stages – Ingest and digitize complex documents, extract data with contextual information, analyze data for insights, and convert data into machine-readable information. However, a lot is happening between the above-mentioned four stages. Here’s a breakdown of all those functions that occur in the background to provide what enterprises expect from an IDP software solution.
Implementing an IDP solution into your existing process without proper planning and strategy can result in the ultimate failure and loss in terms of investment returns. Further, poor planning and implementation can cause a steep learning curve for employees, creating hindrances in the seamless flow of processes. To prevent such unpleasant occurrences, enterprises need to adopt a comprehensive strategy, which is divided into the following five steps:
As per statistics, by 2030, innovative technologies like AI and Automation will replace an estimated 46% of insurance claims and policy processing jobs. Therefore, insurance companies need to embrace the change as soon as possible for competitive advantage in the saturated market. And they have valid reasons to do so, namely:
IDP solutions can benefit insurance providers in a great many ways, but ideally, there are six prominent use cases for scaling success with IDP implementation.
Contract and claims form processing: IDP solutions reduce the frequency of document handling to prevent loss or contamination of data. IDP auto-extracts various details from contracts and claim form submissions and stores them in contract management systems to allow centralized online access. Further, documents received by fax and snail mail are digitized for future access and processing.
Claims processing: Claim forms are digitized for auto-review and auto-categorized and stored in a shared centralized repository for further processing.
Document verification and KYC: Intelligent Document Processing in insurance allow employees to read and extract data from identification documents submitted by customers. IDP scales up customer onboarding and processing of claim applications faster.
Customer onboarding: Extracting customer-related data, such as insured name, company, industry, and beneficiaries, is catered by intelligent document tools to expedite the onboarding process.
Risk profiling: IDP solution can be used along with RPA software bots to collect data from internal databases and third-party websites. IDP and RPA automate the whole process and generate customer risk scores in less time.
Invoice generation: IDP platforms allow auto-ingestion of data from spreadsheets and integration of the same in the enterprise ERP system. IDP maintains records of previous invoices, auto-generates new invoices, and shares them with concerned parties via email.
The demand for Intelligent Document Processing is surging, not just in the insurance sector but in others as well. There are two critical drivers for IDP market growth, namely:
Hence, the future of IDP in insurance is likely to be dominated by more cloud-based solutions, advanced Machine Learning capabilities, enhanced features supporting multi-language and handwriting recognition and signature detection, and connected enterprise automation solutions.
IDP in insurance has proved to be a game-changer for the whole sector. With added capabilities, Intelligent Document Processing is set to transform document-heavy business processes and scale enterprise automation journey.
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