Turnaround Times Affecting Insurance Business Growth

As an insurance carrier or MGA, you might already know how longer turnaround times (TAT) can potentially affect your customer services, create bottlenecks, and hinder insurance business growth. But are you aware of what’s going wrong in the back office? What’s causing the turnaround time to be longer than expected? If not, here are some possible reasons;

• Your staff is overburdened
• You are running short on workforce
• You are unable to leverage the latest technology
• You are struggling to upgrade legacy systems
• You are facing issues with process development

When you find out that your insurance business faces issues meeting targeted TATs in the underwriting and operational areas increasing your backlog, you would most likely take the following actions;

• Deployment of employees
• Recruitment and training
• Pay for employee overtime
• Schedule more meetings for operational improvements
• Invest in technologies like Robotic Process Automation (RPA)
• Opt for insurance business process management services

As you might not be able to immediately decide on what you should do next, you may learn more about how turnaround times increase the backlog and limit growth so that you can prepare an effective plan of action. We conducted a survey asking industry experts to give their views on this topic; let’s read what they said.

Experts’ Opinions on Turnaround Times Affecting Insurance Backlog & Hindering Growth

1. Impacting Open & Active Insurance Cases

It is well-known that an organization’s turnaround time for incoming claims can impact both the backlog of open insurance cases and the number of active cases. If claims are taking too long to process, two possible solutions exist:

i) employ more people, either full-time or on a temporary basis; or

ii) outsource at least some of your testing needs to an outside reputable laboratory that will be able to turn around cases much faster than you can internally.

You need someone who’s trained in accurate testing procedures. Outsourcing also has the advantage of reducing costs so your financial resources can go elsewhere where they are needed most, such as phone agents, office space, marketing, etc., but outsourcing does not solve everything.

It is important for a business to deal with its insurance backlog as long as the company is running. This means reducing the time from when an invoice for work or materials received from a vendor, as well as any incidences which occur during the course of day-to-day operations, are noticed to when payment is made.

In order to reduce turnaround times and lessen the weight on the company’s IT systems, it helps greatly to have well-written contracts that spell out liability and cost, preapprove service requests by vendors who could respond faster if need be, always ask for proof of payment before doing anything else in order reduce processing time, hourly price estimates, so it never exceeds available budget constraint upfront.

– Ryan Fyfe, COO at Workpuls Inc.

2. Longer TATs are Company Growth Barriers

Generally, turnaround time is defined as the time interval starting from the time of submission of a process to the time of the process completion. They affect the insurance backlog and become an obstacle for company growth because it creates discrepancies between the departments. This subsequently leads to incorrect information and delayed claim settlements.

Moreover, backlogs directly impact the morale of your employees, their attitude towards their job, and their behavior with the customers. The reason is that employees who are constantly working with backlogs are unable to keep up with the deadlines, which increases the stress in the workplace.

Even sometimes assigning the tasks to your best staff adds up to their workload, and the tasks are not still completed regardless of extra time and effort being put in.

– Christopher Morgan, founder of Credit Help Info

3. Automation Helps Speed Up Processes

Shortening the sales cycle is essential to keep a competitive advantage in the insurance business. The quicker a company submits a quote, the higher the probability that they close a deal. This is where intelligent automation helps: by speeding up the review of policies and benefit booklets, it accelerates the quote submission process and contributes to company growth.

Internal research from our customers shows that the quality of quotes significantly improves through automation; in other words, it positively impacts their bottom line by leading to better margins or increasing the probability of signing a contract.

– Steve Levine, CMO at Cortical.io

4. Long TATs can Lead to Loss of Cash and Customers

Prolonged turnaround times on the crucial business processes in the operational and underwriting areas of your insurance firm can cost you enough money, affect your capability to develop, and impact your customer service.

BPO is the one-stop solution to cut through the backlog, retaining new employees, and sparing you the expenditure of hiring and training. BPO outsourcing organizations obtain cost amenities of 20%, whereas customers, which are dedicated to BPO, can achieve higher cost benefits of more than 30%.

Therefore, the probable solution for mitigating such a high turnaround time will be the reallocation of your in-house resources from major time-consuming works to work on strategic projects.

– Stephen Curry; CEO at CocoSign

5. Offering Self-service Portals Can Help

Currently, the epidemic has caused countless job losses, wage reductions, and other severe consequences. The lockdowns prevent brokers and insurers from interacting with consumers face to face or physically meeting with them.

Customers are also demanding that premium levels be reduced until the economy has steadied. As a result of the current scenario, insurance firms must develop ‘Stay at Home’ solutions for their customers, which may be accessible through a smartphone or any other digital device. The insurers will have a larger reach and success as a result of this.

– Michael Hamelburger, CEO of Sales Therapy

6. Longer TATs Impact Operations & Bring Inconsistency in Processes

Impact on Your Business Proceedings: It is a well-known fact that turnaround times need to be shorter to have a positive influence on your customer service and company growth. Long turnaround times can have a drastic impact on your business proceedings.

• More money will need to be invested in the company as your operational process will be slowed down.
• Customers will not get the usual service making a bad case for the insurance companies.
• The systems would not be powerful enough to carry out insurance backlogs, and the overall performance will also decrease.

This can be the final nail in the coffin and explains the importance of short turnaround times for an insurance company.

Turnaround times impact the insurance backlog by hindering the growth of the company. Other than this, it poses several challenges, for example:

Process Discrepancies: When turnaround times increase, the backlog creates discrepancies between different departments. This subsequently leads to incorrect information, delayed and unsatisfactory claim settlements. Moreover, when the system does not have updated customer information, you are unable to provide excellent customer service.

Adopting digital technologies can help companies to boost their customer service while assessing the risks. All the clients are making use of digital solutions, such as mobile apps, and it is helping the insurance companies to achieve success. Therefore, to sort out the backlog, these companies must make use of automated technologies to ensure that claims are created and handled on time.

Turnaround time affects the business growth of my insurance company by turning customers away. Due to the backlog, the claims are not settled on time, due to which we are unable to provide customers with solutions to their queries. As a result of this, they switch companies which incur a loss on our organization.

– Linda Chavez, Founder & CEO of Seniors Life Insurance Finder

How Can Cogneesol’s Insurance BPO Services Help?

If you think your insurance company doesn’t have enough resources to speed up workflow, you may consider insurance BPO services that can bring a positive change in how you manage different operations.

We are experts at insurance services and can help optimize your processes that will result in smooth workflow and quick turnaround times.

As we work on resolving your backlog and streamlining operations, your internal resources get more time for other important business areas, ensuring you get and stay ahead of your competitors in today’s insurance marketplace that is highly competitive and fast-changing.

To learn about our customizable insurance services and pricing plans, contact us today. Dial +1 646-688-2821 or send an email to [email protected]