If you’re in the insurance industry, you’ve probably heard a lot of buzz around insurtech. But what, exactly, is insurtech? It’s the digital transformation of the insurance industry, moving us away from processes and systems that waste our time and energy.
In return, this digital transformation is helping us increase efficiency, remove redundancies, provide a higher level of service for our customers, and drive more profit.
As someone who has personally led digital transformations at big carriers and startups alike, here are my thoughts on the topic and what Hourly is doing specifically to make life a whole lot easier.
So What is Digital Transformation Really?
Before we get too far into what’s happening with digital transformation in insurance, let’s quickly cover what digital transformation actually means.
Digital transformation is the process of integrating technology into a business or industry to make it more efficient and profitable. But it’s also bigger than that. When a business or industry undergoes a digital transformation, it doesn’t just create the opportunity for more efficient systems or higher profit—it fundamentally changes the way that business or industry functions.
What is Digital Transformation in Insurance?
Now let’s talk about the insurance industry. Historically, insurance has had a reputation as a necessary and important industry—but not necessarily an efficient one. For decades, much of the industry relied on paperwork and outdated systems that created more work than necessary, which had a negative impact on both profits and overall productivity.
In the past, an agent would need to go through a lot of steps to bind a policy for a small business. For example, if they were binding a $2,000 policy, they’d need to get the business owner to fill out the paperwork, send the paperwork to the carrier, gather additional paper information for underwriting, and more. Since the process was all paper reliant, the amount of time necessary between steps would make it extremely difficult for that $2,000 policy to be profitable.
But by making a simple switch from paper applications to a digital portal, information is more quickly and efficiently shared between the customer, the agent, and the carrier. This decreases the amount of time and effort it takes to submit, underwrite and bind policies—which increases their profitability and frees up the agent’s time to focus on connecting with more clients and driving more revenue.
That’s digital transformation in a nutshell.
Another example is the process of getting an insurance quote. Underwriting used to be a lengthy process and it usually took a while to get a quote back. Quotes could differ depending on what underwriter was looking at your paperwork.
With digitization, the whole game has changed. Insurance companies now use predictive modeling, artificial intelligence and other data sources to quickly analyze how likely it is a customer will have a loss. Programs crunch stats on what geographic region the customer is in, their industry behavior, past and current financial data, and more. The best part is, many quotes come back instantly, they’re consistent (i.e., you’re not getting different quotes from different underwriters), and they’re bindable right away.
The point is, the more things you can digitize, the more efficient things will be—and the more opportunity there is to drive profits. That’s the core of digital transformation in insurance and the rise of insurtech—and it has the potential to completely revolutionize the insurance industry.
How Hourly is Transforming the Insurtech Space
Now that you understand what digital transformation in the insurance industry looks like, let’s jump into how Hourly is currently transforming the insurtech space–specifically by creating opportunities for agents and businesses alike to increase their efficiency and profitability.
There are a variety of ways Hourly’s digital platform is doing this, including:
Allowing Businesses to Pay, Manage and Protect their Teams all on a Single Platform
Hourly combines workers’ comp, payroll, time tracking and HR into a single platform.
This integration is a huge benefit to business owners, giving them access to the data they need to manage their businesses better—like to-the-penny accurate workers’ comp premiums so that when they’re looking at labor costs and invoicing their customers, they can be sure they’re not ripping themselves off. They also save a bunch of time and decrease the chance of errors by not manually inputting timesheets.
Take one of our clients, Peninsula Hardwood Floors, for example–a small business in Silicon Valley founded by two brothers, Juan and Joel. Before Hourly, they were using paper timesheets and Excel to figure out how much they were spending on labor every week. How much time did that take? Too much. How many critical errors were made? Too many.
Now their employees manage their time and attendance on the Hourly app, which shows Juan and Joel their teams’ hours, jobs and locations in real-time. Now Juan and Joel can check how much they're spending on labor with one click. That makes it way easier for them to bill their current customers (accurately!) and bid on new projects.
Giving Agents Unprecedented Access to Data
Since agents also have access to their clients’ data through the Hourly platform, they can see if clients are growing or reducing their teams–and by how much. Agents can then suggest the right changes to their clients’ policies or suggest other lines of insurance or class codes they need. By doing so, agents can assure their clients they never have to worry about whether they have the right coverage or not. Now that’s comforting.
Simplifying the Audit Process with Pay-As-You-Go Premiums
Workers’ comp policies are generally based on estimated premiums—but if anything in the business changes (for example, they hire more employees or reduce their workforce), those premiums also change, leading to either a large and unexpected bill or unnecessary overpayment at audit time.
But with Hourly, premiums are calculated using real-time data—and if the business changes, so do the premiums. That means, when it comes time for the insurance audit, there are no expensive surprises—and the audit is a more streamlined, efficient process for the agent, business owner, and carrier.
Offering Access to 500 Class Codes
Come to Hourly regardless of the type of business you or your client has, and we’ll get you a competitive quote.
With Hourly, agents don’t have to submit physical paperwork. Any documentation they need to submit can be submitted as an attachment straight through the app.
Claims Reporting and Co-Branding for Your Agency…Coming Soon!
Next quarter we’re adding a feature that will allow injured workers to report claims with a single button–and another feature that will let agents add their branding to their client’s Hourly platform. That way, agents will be able to do their job even more easily and stay top of mind with their clients.
Use Insurtech to Improve Your Business
Whether you’re an insurance agent, an insurance agency, or a small business owner, you want to do everything you can to increase efficiency in your business and drive more profit. And the best way to do that? Digital transformation—and that includes choosing the right insurtech for your business.