The insurance industry is facing more new regulatory and compliance regulations than ever before. This means that insurance companies have an increased need for organized, secure, and efficient systems. Gone are the days of paper filing systems or even of simplistic databases. Insurance companies are now beginning to utilize Business Process Management (BPM) systems with great success.
Business Process Management is an approach designed to increase the efficiency and flexibility of an organization’s workflow through the optimization of the business processes. Insurance companies, in particular, are constantly working through many concurrent processes whether related to claims, compliance regulations, underwriting, backend administrative tasks, or a number of other necessary operations. All of these processes can be optimized and workflow improved through adoption of BPM.
The current legacy systems typically used by insurance companies for tasks such as underwriting and managing claims are often inefficient, inflexible, and can end up causing more problems than they help solve. Companies might be using multiple different legacy systems to track and manage various processes. The legacy systems often don’t communicate or cooperate with each other and can’t be adapted to do so. This is where the benefit of flexibility in a BPM system is so apparent.
With regulations constantly changing, insurance companies using a system like BPM have an advantage in that they can quickly adapt their processes and workflows to comply. With legacy systems, compliance to new regulations might be costly, time-consuming, frustrating, or even simply impossible. BPM allows insurance companies to adjust their workflow of processes easily.
Insurers are also leading the development and adoption of innovative approaches to implementing BPM, especially in underwriting and compliance functions. Traditional BPM, such as that provided by IBM’s BlueWorks Live, exemplify lengthy deployments, requiring large budgets and a horde of specialists and developers to implement.
Lean BPM suites, such as JobTraQ, eschews the Big BPM mentality, instead opting for a very short, very fast deployment of a BPM suite over an existing set of processes to gain visibility on what is happening in the As-Is state almost immediately. Emergent Process design is then used to gradually and continuously improve insurance processes, and this is made possible by the ability for non-technical, operational and administrative staff to use the BPM tools provided themselves without the need for specialist coding or developer skills.
Insurance companies also see benefits from optimizing their business processes through BPM systems in the areas of customer satisfaction, decreased costs, and overall productivity. Many of the processes that insurance workers go through on a daily basis can be automated, or at least streamlined to some degree. Often insurance companies aren’t even aware of which processes are being done, much less how to improve those processes. By setting up efficient workflow models utilizing a BPM solution, leaders and partners can more easily see areas of improvement for process efficiency.
They are able to target bottlenecks, where work might be getting back up, more easily. They can also easily rework processes to avoid situations like that in the future, which can be detected through modeling of the workflows. This is necessary since it is impossible to fix a problem if you are not aware that it exists. Even if there is not a problem per se, there is always room for improvement, which BPM can help discover.
By improving process efficiency through BPM, insurance company employees have more time to focus on each task and spend time on other tasks that might be otherwise overlooked. This can lead to a decrease in mistakes which could have been costly. The additional time that they are saving can also be used toward generating new business or improving relationships with current customers. All of these improvements in efficiency and increased automation through BPM can ultimately affect the bottom line for an insurance company.
Amira Chugunova is a tech and business blogger with a focus on healthcare and Operational Excellence, and particularly in the use of BPM tools to improve process and quality standards in hospitals and medical practices.