The State of Banking and Insurance: Five Key Take Aways from Our Study
Digital transformation has shaped the world at a different level. It made the market even more competitive and dynamic in nature. Every industry wants to upgrade their business through technological advancements. Especially financial and insurance sectors.
With the advent of technologies like Artificial intelligence (AI) and Generative AI, we can witness that the BFSI (Banking, Financial services, and Insurance) sector is growing at a rapid pace. As per the International Monetary Fund (IMF) projections, it is estimated that the world economy will grow at a modest rate of 3.0% in 2024.
To decode the complexities of this expanding market, we have embarked on a comprehensive research initiative. Our survey is strategically designed to gain insights into the prevalent challenges within the industry and to explore the potential of artificial intelligence in overcoming these obstacles.
We carried out an online survey, in collaboration with Sapio Research, from August to September 2023. Our research engaged the diverse pool of participants spanned across five nations: the UK, Germany, Sweden, Norway, and the Netherlands.
Through this blog we try to highlight the key findings that we have achieved through our extensive research and why it is important for you to know our findings.
Efficiency is non-negotiable.
In a rapidly growing business environment, efficiency is non-negotiable. Through our research we found that engaging with claimants and stakeholders consumes the maximum time. This could cause dissatisfaction as it delays the other crucial processes.
But what is the reason of such delays and how to overcome these challenges?
We found 45% delays are due to inadequate documentation. The ambiguous requirements, inefficient collection processes and misplacement of information are the main reasons of such delays. As a result, it increases errors, disputes, and leads to potential financial losses. Due to all these challenges, claimants lose trust and avoid future interactions. Claims management is crucial to enhance the effectiveness.
Communication is the key to success.
Effective communication, both within an organization and with customers, is vital. Nearly half of the respondents feel that their current software is not adequately supporting their ability to respond promptly. This slows down the response process leading to customer dissatisfaction. An unequipped software leads to increased frustration in both customer and agents. Due to all these delays consumers ultimately lose their trust and loyalty.
On a business front we found that due to delay in response time, the overall operational cost increases.
For in depth analysis please download our latest report here.
Businesses need to match the customer expectation.
Today customers are well read. They are aware about all the latest technology. They expect better service and response from the business. For them quality matter the most.
86% consumers value clear communication and 85% priorities professionalism as a key factor. Consumers can easily lose trust or feel dissatisfied if they perceive any lack of clarity or professionalism in their interactions. Hence businesses need to constantly adapt and monitor the latest trends and technologies to ensure the customer loyalty. They must opt for modern tools and solutionsto overcome such challenges.
Empower business with technology.
Embracing technology, particularly AI, empowers businesses. Interestingly 69% of agents foresee AI (Artificial Intelligence) as the game-changer in claims handling process. Its efficiency in handling claims by addressing challenges like delay in response time and inefficiency makes it significant.
This demonstrates a widespread appetite across the industry for solutions that can refine workflows, minimize manual interventions, and enhance response times from hours down to few minutes.
By leveraging AI, insurance companies can provide more accurate risk assessments, personalized policy pricing, and faster claims processing, which significantly enhances customer satisfaction.
Automation and AI- beacon of hope.
As per our research we found more than half of the consumers (54%) have engaged with chatbots from their bank or insurance providers. This signifies there is a substantial acceptance of AI technology in the financial and insurance sector. Businesses in these sectors are actively investing in AI-powered chatbots to cater their customers in a better way.
But is chatbot is the most adequate solution? The satisfaction level with chatbot is just 45%. This indicates that there is a gap in the functionality of chatbots. There is a need of more advanced AI-powered solution that can better understand and serve customer needs.
The data signals a critical need for enhanced efficiency and communication in banking and insurance. Facing the twin imperatives of operational speed and client contentment, these sectors find a powerful solution in AI. Its adoption promises to overhaul customer service frameworks, dramatically accelerating service speed and enriching client engagement. With AI at the helm, banking and insurance are transitioning from mere automation to genuine intelligence.
AI stands as a pivotal innovation amidst challenges in communication and claims efficiency, and consumer satisfaction. Through predictive analytics, machine learning, and advance automation, AI can alleviate agent workloads and satisfy consumer demands for rapid, clear communication, leading to a smarter, more responsive service experience.
To decode the current challenges in Insurance and Banking, please download our latest report here.