6 MINUTE READ
The insurance industry has long been known for its conservative approach. Senior insurance executives are sometimes resistant to change, also when it comes to adopting new technologies. However, the entry of Generation Y (Millennials) and Generation Z into the workforce is challenging this status quo, bringing a tech-savvy perspective that is crucial for modernizing the industry.
This blog explores how young managers and employees can transform the insurance industry, emphasizing the benefits of technology and speed.
Young Claims Managers and Adjusters are the Future of Claims Management
Generation Y and Z have grown up in a world where the internet and mobile technology are integral to daily life. They are accustomed to doing everything online, from socializing to shopping, and they expect the same level of convenience and efficiency in their professional lives. As these generations take on managerial roles, they expect to use technology in order to streamline processes, facilitate communication, and provide quick access to information.
This is true, for example, for claims adjusters. Adjusters often start their careers young. Young claims professionals quickly become frustrated with outdated and inefficient legacy systems and manual processes. The high attrition rates and difficulty in recruiting talent to claims teams are testament to the dissatisfaction from manual, repetitive work, with no change in sight.
McKinsey’s Global Insurance report highlights that the insurance industry is undergoing structural changes, with a focus on digital and AI technologies. This shift is often driven by younger managers who are more comfortable with technology and understand its potential to improve efficiency and profitability.
The New-Gen Issue with Legacy Systems
Despite the clear benefits of digital transformation, many insurance companies remain risk-averse, sticking to the ways things have always been done. This conservative mindset is often at odds with the expectations of younger employees who are eager to embrace new technologies and create more efficient workflows.
This resistance to change can lead to significant frustrations among younger employees, who are accustomed to the seamless, intuitive digital experiences provided by modern technology. They often find themselves hindered by outdated, cumbersome systems that slow down their work and reduce overall efficiency. This discord can contribute to high turnover rates, as talented professionals seek modern, tech-enabled workplaces that align better with their skills and expectations.
Moreover, legacy systems can lead to substantial operational inefficiencies. Manual processes and outdated technology often result in longer processing times (longer hours of work), increased error rates (frustration with poor feedback), and overall higher costs (resulting in less bonuses). Such inefficiency affects the company’s bottom line and hampers its ability to reward claims adjusters and improve their workday and workload.
To address these challenges, insurance companies can start transitioning towards modern, cloud-based claims management solutions that offer improved efficiency, accuracy, and customer satisfaction. This shift is also essential for retaining top claims talent and staying competitive in an increasingly digital world. Newer platforms have a better user interface, which young professionals feel more comfortable with. Automation and AI can improve many aspects of their work.
Embracing Technology: Don’t Let Gen Y and Z Escape
Generations Y and Z have the potential to drive significant change within the insurance industry. Instead, given the conservative nature of the industry, many of them are not given the chance to influence.
According to Deloitte’s 2022 Global Millennial and Gen Z Survey, 45% of Gen Zs and Millennials feel burned out due to high work demands, and many consider leaving their jobs, in search of a better work-life balance, adopting a cause closer to their values. They want to work for organizations that empower them to get directly involved to drive change—both within their organizations and in society more broadly.
Insurance companies can offer such opportunities. Carriers that harness the insights and tech-savvy nature of their younger employees, will be able to modernize their operations using internal resources. For example, by allowing young claims adjusters to voice their frustrations with legacy systems and inefficient processes, and suggest solutions, companies can begin to transition to better systems and better ways to manage claims.
When innovative claims managers look up a better claims management system for the new age, they often find startups whose founders were once employees in insurance companies. They found it difficult to influence change and overcome resistance, so they went on to start tech startups that create innovative solutions for the insurance industry.
A Tech and Talent Solution: Empower Adjusters to Lead Digital Transformation in Claims
The solution is clear: let your claims adjusters lead the way. Give them the freedom to identify what bothers them about current systems, research potential solutions, and explore potential fit.
Invite your adjusters for demo sessions and let them test modern systems. This approach also ensures that the solutions that end up being adopted are not only user-friendly and effective, but also get buy-in from the actual users.
Benefits of a Modern CMS
- User Experience and Interface: A modern claims management system offers a web-based, intuitive, and user-friendly interface that reduces training time and increases overall user satisfaction, making it easy and intuitive for adjusters to use.
- Automation: manually filling documents, populating FNOL, and choosing vendors from a long list is so 90s! It takes a lot of time and irritates adjusters. A modern CMS can help automate repetitive and routine tasks, freeing up adjusters from administrative burdens and allowing them to focus on customer care, decision-making, and development of forward thinking ideas. An automated claim process can reduce cycle time by 60%!
- Full Visibility and Control: Adjusters should have all the data they need in one place. No more scattered data, hiding in multiple systems, Excel sheets, and paper folders. A modern CMS should offer full visibility to the entire claim data in one convenient application.
- Omnichannel Communication Hub: All forms of communication—calls, emails, texts, and more—should be integrated into the CMS, ensuring that all communication is captured and indexed for compliance and customer service.
- Connectivity and Integration: One of the most important aspects of a modern CMS is its ability to communicate with other systems for seamless sharing and synchronization of information. A system that invests in its APIs and webhooks is the way to go.
The Young Generation Choice: Five Sigma
The insurance industry stands at a crossroads. By allowing the younger, tech-savvy generations to lead the digital transformation, companies can modernize their claims management processes, reduce inefficiencies, and improve customer satisfaction.
Five Sigma’s AI-Native claims management platform exemplifies modern technology for the insurance industry. Designed by claims professionals and technology experts, Five Sigma automates and streamlines every step of the claims process, from first notice of loss (FNOL) to final settlement, reducing the time to first contact and improving time to settlement by 45% to 60%.
Five Sigma reduces costs and enhances operational efficiency. Moreover, it significantly boosts employee satisfaction by minimizing manual tasks and allowing adjusters to focus on more meaningful work. The result is a more productive and happier workforce, providing better customer service to policyholders.
