Can intelligent automation ensure the survival of the insurance industry? 

December 15, 2022 Windstream Enterprise 5 min

Editor’s Note: Today, many providers in the insurance industry are struggling with rising costs, fierce competition, ROE slightly below the cost of equity, lack of growing demand and an over-reliance on price increases to remain profitable. The industry demands increased speed and production only possible with the infusion of intelligent automation, which delivers reduced turnaround time, increased volume of applications, fewer errors, assured regulatory compliance and frees employees for the value-added service that earns customer loyalty.  

It’s best to leverage intelligent automation by working with an automation management partner who can streamline a gradual transition from outdated legacy systems to an efficient, productive model combining the convenience of digital channels with the personalized service of human employees. Future success and relevance in the insurance industry rest on the willingness of providers to adapt in a rapidly shifting environment where digitizers will enjoy a competitive advantage and laggards left clinging to legacy models will become obsolete. 

Today’s customers, regardless of industry, demand a combination of buying convenience and personalized attention. If your team can’t deliver your customer will quickly find someone who can, so harnessing the power of intelligent automation is becoming critical for insurers. 


Insurance firms that integrate intelligent automation (IA) into their processes can effectively replace outdated models with profitable alternatives to improve margins, productivity and satisfaction for both customers and employees.

The economic viability of the insurance industry’s current business model has been in question for several years. McKinsey’s 2022 Global Insurance Report shows that 52% of the industry’s global equity had a return on equity (ROE) lower than their cost of equity over the past five years.  

While most insurers predict premiums will continue to rise in 2022, following the 2020 pandemic-induced growth rate contraction to 1.2%, many non-pandemic obstacles remain in place, including changing consumer preferences and the rise of relevance-challenging advanced technologies.  

Intelligent automation (IA) can upend this outdated model, replacing it with an effective and profitable alternative. By integrating IA into claims, underwriting, pricing and distribution processes, insurance firms can improve margins, productivity and customer and employee satisfaction.  

Why is the insurance industry lagging?  

The insurance industry is in a state of stagnation, struggling to maintain profitable operations. Fee transparency has made it easy for customers to seek out lower-cost options, while growing technology adoption has heightened price and speed pressures, fueling an increasingly competitive landscape.  

Advanced technologies can help the insurance sector unlock latent customer demand, improve value creation and cultivate growth and innovation. 

Property and casualty insurers have struggled to reduce costs in recent years. The overall industry has seen an ROE slightly below the cost of equity—except for insurance brokers, the only segment to see positive economic growth. These oppositional forces are further compounded by the lack of growing demand in mature markets. The industry is increasingly dependent on price increases rather than expanding client bases and new coverage offerings.  

One of the industry’s greatest threats is this changing growth model that relies on price increases. The sector needs to unlock latent customer demand, improve value creation and cultivate growth and innovation. Advanced technologies can accomplish this, resulting in lowered costs, optimized customer and employee experience and improved decision-making and productivity.  

Why has digital transformation become imperative for the industry?

The market’s changing demands require insurance companies to operate at increasingly faster speeds. As McKinsey reports, “What used to take years must now be done in months or weeks.” Such rates of operation can be accomplished by leveraging the powers of intelligent automation.  

By integrating IA, insurers can reduce their turnaround times, take on higher volumes of applications, and drastically reduce error rates, which are more common when human workers are left to conduct repetitive tasks. This gives employees time back and enables them to develop innovative strategies, focus on complex cases and offer tailored customer experiences.  

This is especially important as the industry’s competitive landscape has become a “fight for the customer.” Consumers expect the convenience and ease of digital channels but still need the personalized service that only human workers can provide. This is where insurance firms can differentiate themselves—by striking the right balance between automation and tailored human service.  

The rapid growth of insurtechs—entities using technological innovations to maximize savings and productivity in the insurance industry—further illustrates IA’s importance to the industry moving forward. Their threat to traditional insurers is evidenced by global investment in them increasing from $1 billion in 2004 to $14.6 billion in 2021.  

Insurtechs offer digitally enhanced client experiences and tend to focus on the marketing and distribution segment of the value chain, along with property and casualty products. These behaviors signal value-adding areas to the rest of the industry.  

How does the insurance industry leverage the power of intelligent automation?  

For many insurance companies, the transition away from legacy systems and siloed functions in the face of budgetary pressures can seem daunting. However, insurers can work with an automation partner to ease the process. Such partners enable them to make the most of their existing systems, using digital workers to operate between previously siloed systems and sync data between applications. This method allows insurance firms to incrementally dismantle their legacy systems rather than being forced into an all-at-once approach.  

Automation management can help insurers streamline the customer journey, settle claims faster and ensure regulatory compliance.

Using this transitional automation strategy, tasks related to onboarding, data analysis, claims fulfillment and invoicing can still be automated, unburdening human workers and, in turn, promoting innovation and new revenue streams. This automation management will help insurers streamline the customer journey, settle claims faster and ensure compliance with the latest regulations. And, as the returns from IA initiatives free up more resources, insurance companies can further automate processes and deconstruct legacy systems, increasing value and returns.  

Thomas Miller, a leading international insurance services provider covering 80 percent of the world’s containers, worked with SS&C Blue Prism to integrate intelligent automation into its operations. The services provider was looking for solutions that worked with its “low-volume, high-value” model and didn’t require implementing costly new IT infrastructures.  

As a result, the company was able to see significant ROI, increase agility and resilience, process renewal applications 24 hours a day/seven days a week, improve accuracy while reducing turnaround times, and give underwriters more time to focus on value-promoting work. This ultimately served to improve the customer experience, a key competitive differentiator in the industry today.  

Although the demand for insurance is expected to continue to rise this year, especially in emerging markets, the industry’s long-term outlook will depend on its ability to adapt quickly. Advanced digital technologies can either boost insurers’ competitive edge or render them obsolete. The future relevance of the insurance industry will depend on its willingness and commitment to adapt to this changing environment.  

This article was written by Concetta Yates from Insurance Journal and was legally licensed through the Industry Dive Content Marketplace. Please direct all licensing questions to

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Key Takeaway
The long-term health of the insurance industry depends on its ability to adapt quickly in a changing environment, which has insurers looking toward advanced digital technologies to boost competitiveness.

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