Insurance leaders are rapidly adopting tech tools. Following a few key steps can make the purchase process nearly painless.
Generative AI is primed to disrupt insurance and all other sectors. A recent IBM survey found that 77% of insurance executives say they must adopt AI quickly to keep up with their rivals. Beyond AI, the insurance technology market is predicted to grow 27% by 2033.
So, what happens when it's time to adopt new technology? For any tech solution that has the power to transform your business, you must meet disruption with deliberation.
Consider why the technology is needed and how it fits into the business. Then start your purchase by thinking about the decision process.
Identify key stakeholders
Before heading down the road of deploying new technology, identify everyone affected by it: the staff who use it, the clients who benefit from it, and the executives who approve the budget. Then, make sure to bring them along.
Getting support from each of these stakeholders takes more than just a pitch. Be transparent and remember that communication involves listening as well as sharing feedback.
Talk to stakeholders about why the new technology is needed and listen to any concerns. Technology should help meet business goals—such as improving renewal rates, reducing claims cycle times, or enhancing agent satisfaction—rather than being a trendy upgrade. Keep those goals in mind, and note challenges, wants, needs, and expectations.
Staff might have concerns about their job security, for instance. Be honest about those impacts. Emphasize that the goal isn't to replace them but to reduce repetitive work so employees can focus on higher-value tasks.
Or it might seem like leaders are resistant to change. Many independent agencies like paper and have been using their current processes for a long time. Make it clear why change is needed.
Launch a search—and prepare for responses
Organizing the search is a key step to finding the best partner for the job. Whether launching a formal request for proposal (RFP) or conducting an internal evaluation, detailing the process will help make a transparent, predictable, and auditable deal.
Here are the four steps of crafting a great request for bids:
- List goals. Detail how the new technology will be used. The vendors are the experts. By sharing your goals, vendors can help find unexpected ways to accomplish those goals.
- Outline the scope of the project. Transparency starts right away. List the expectations for the vendor and get ahead of any potential hurdles.
- Set the budget. Be clear about how much money can be spent on the project. And discuss internally how much extra to set aside in case the project grows beyond the original scope.
- Lay out the timeline for making a decision. Set a timeline for the decision process and stick to it. Let vendors know what steps are along the way and how communication will happen.
Laying out each of these pieces helps the communication process with vendors and makes it easier for them to know how to respond with all the useful information.
Self-evaluation, then evaluation
Maybe the most important step is what comes after the search: evaluation.
Before even looking at the first response, detail the decision process including the criteria that will be used for evaluating responses and how internal disagreements will be resolved.
Putting the decision process in writing can help in the tricky situation of getting too many good responses that need to be narrowed down.
If the call is tough to make, consider what is most important for meeting business goals. The lowest-price vendor might not offer key features or integrate with other tools. Or the technology with all the bells and whistles might be more than what's actually needed.
When evaluating a vendor, consider everything they have to offer. Not only should they meet the project's goals but also assess whether they can provide continuing support and if you trust them as a partner, because relationships matter.
Once you're ready to make a deal, stop to make sure everything lines up with the criteria that was set in the first place. The end goal is to find the solution that will best serve clients. Don't lose sight of that.
Know when to pivot
Ending an agreement or restarting a search isn't easy. When a vendor just isn't working out, don't fall for the sunk-cost fallacy. Refer back to the original criteria.
It's time to pivot when you've exhausted all possible workarounds. If the business doesn't meet the needs of the three stakeholder groups—clients, business leaders, and employees—or can't meet the terms of an agreement, it's time to pull the plug.
Flexibility is key to adapting when things don't go as planned.
When implemented thoughtfully, technology can benefit insurance agencies and carriers tremendously. These steps can help focus the decision-making process on what matters most and avoid common roadblocks.
With the right approach, new technology can help enhance customer service, improve operational efficiency, and stay competitive in an evolving market.
