Standardization plays a crucial role in successfully implementing insurance automation for insurance wholesalers, carriers, and managing general agents (MGAs).
Automation in the insurance industry involves the integration of software that is capable of streamlining various applications and processes. As a result, wholesalers, carriers, and MGAs can enhance their operational efficiencies, improve accuracy, and shorten turnaround times.
Standardization creates a uniform set of rules, procedures, and formats for specific tasks and ensures they are executed consistently across a company.
When a company implements automation software, having standardized procedures ensures the same rules and guidelines are followed consistently throughout its operating system.
Why insurance automation standardization matters
Standardization is considered the backbone of successful insurance automation. Here’s why:
Greater efficiency: Because standardization ensures consistent practices, automated systems can execute repetitive tasks faster when they operate within a uniform framework.
Reduced errors: Implementing standardized processes helps minimize variations and reduces the likelihood of manual and machine errors when entering data, managing accounts, submitting policies, etc.
Improved system interoperability: Wholesale companies and MGAs often work with multiple insurance carriers. Standardization ensures that data formats, communication procedures, etc., are consistent across various systems, allowing them to communicate and exchange information seamlessly—and do so with greater accuracy.
Improved compliance: Standardized practices help meet regulatory requirements by ensuring compliance with legal obligations, industry standards, and best practices. Programming automation systems (so they are in-line with these standards) can help reduce the risk of being found in non-compliance.
Greater cost savings: Streamlining processes and ensuring consistency reduces the need for many manually performed tasks, helps lower error rates, and minimizes operational costs.
Smoother data exchanges: Standardization in insurance automation provides a uniform format that enables a smooth and consistent data exchange between all stakeholders.
Improved customer service: Brokers expect prompt service when interacting with wholesalers and MGAs. Standardization enhances customer service by providing quicker responses, accurate info, etc., based on standardized workflows.
When considering insurance automation, wholesalers, MGAs, and carriers must prioritize standardization. By implementing set standards, they can ensure consistency, quality, accuracy, and interoperability across various systems, products, and services.