Stressed Out P&C Insurers Need Digital Solutions, Outsourcing Partners to Address New-Age Risk Management Complexities--Everest Group

DALLAS, July 22, 2019 /PRNewswire-PRWeb/ -- Property and casualty Insurers could relieve many of the risk management headaches they face today by leveraging digital technologies, but internal budget and staffing constraints typically prevent them from doing so. The solution to this problem is increased collaboration between risk managers and business process outsourcing (BPO) service providers, according to Everest Group.

"New-age market dynamics in the Property and Casualty insurance industry have negatively impacted insurers' ability to effectively assess and underwrite risks and have exacerbated the need to rapidly evolve archaic risk management functions," said Skand Bhargava, practice director at Everest Group. "Solutions to P&C risk management challenges can be found in digital technologies such as workflow automation, drone inspections, analytics, IoT, and artificial intelligence. However, because of internal challenges, many insurers are limited in their ability to adopt the requisite digital solutions. We highly recommend that insurers source risk management services from third-party providers to tackle internal limitations while also boosting productivity."

Property and Casualty (P&C) insurers have been witnessing massive external disruptions in their business ecosystem, including:

• Customers demanding Amazon-like experiences
• Climate change causing widespread and difficult-to-predict catastrophes
• New-age coverages for cyber breaches and drones
• Increased demand from small and midsized businesses (SMBs), for which traditional risk models for personal or commercial lines are not well aligned

Digitalizing risk management operations would help P&C insurers address these market shifts, but most insurers are overwhelmed by internal challenges such as budgetary constraints, shortage of requisite talent, and out-of-date technology. As a result the market is ripe for third-party service providers that have both a knowledge of insurers' risk workflows and the requisite digital capabilities to reduce cost and talent pressures, impart flexibility and compliance preparedness, and deliver superior customer experiences.

Specific examples of how digital technology can be applied in risk management include the following:

• Workflow automation: automated data collection from multiple sources for assessing risks while underwriting; improved customer services, resulting in increased probability of customer retention
• Drone inspections: Aerial data collection enabling remote inspections when the conditions are hazardous from deploying claims adjusters on the ground
• Analytics: Geospatial analytics to assess the potential risks that policyholders face in a particular location
• IoT: Property sensors alerting insurers about impending risks such as fire or flood
• Artificial Intelligence: Natural Language Processing (NLP) technologies enabling digitization at source and thus expanding the pool of data that risk managers can leverage while also streamlining operations

Everest Group explores these findings and others in a recently published report: "Property and Casualty (P&C) Insurance BPO Annual Report 2019: Combating New-Age Risks – How Digital Helps."

***Download a complimentary abstract of the report*** (Registration required.)

About Everest Group
Everest Group is a consulting and research firm focused on strategic IT, business services, engineering services, and sourcing. We are trusted advisors to senior executives of leading enterprises, providers, and investors. Our firm helps clients improve operational and financial performance through a hands-on process that supports them in making well-informed decisions that deliver high-impact results and achieve sustained value. Our insight and guidance empowers clients to improve organizational efficiency, effectiveness, agility and responsiveness. What sets Everest Group apart is the integration of deep sourcing knowledge, problem-solving skills and original research. Details and in-depth content are available at http://www.everestgrp.com.

SOURCE Everest Group