The digitization of the European insurance area
Over the past two years, the pandemic-induced digital shift has forced payment providers and other organizations to improve their payment processes, especially as consumers seek ever-faster payments and experiences. streamlined digital.
The insurance industry is one industry that is rapidly working to modernize operations as companies overhaul their legacy operations to cater to digital-first customers.
According to a recent survey of European insurance companies featured in a recent PYMNTS report, almost 90% have undertaken some sort of digitization initiative to improve the customer experience and facilitate claims processing and document management for digital-first consumers.
Read the report: Follow-up on January disbursements
The January report on disbursements and overcoming obstacles to instant payments, published in collaboration with the American money mobility company Ingo Money, further revealed that 42% of insurance companies in the region said they wanted to use technology to develop their mobile app experiences. Additionally, 34% of respondents expressed interest in building their digital payment capabilities.
However, these efforts to meet consumers’ needs for instant payments could fail if payers do not take the necessary steps to overhaul their digital infrastructure to support these transactions, such as investing in automation and advanced tools that enable digital instant payments and secure transactions. are smooth and secure.
These tools include artificial intelligence (AI) and machine learning (ML), which can be particularly useful in helping payers get up to speed by enabling real-time notifications, decision-making and data processing. , notes the report.
Read more: Why automation and other technologies are key to the continued growth of instant payments
In a recent interview with PYMNTS, Ingo Money CEO Drew Edwards said payers who don’t risk losing two-thirds of consumers who will turn to competitors to meet their payment needs if they don’t. do not have access to instant or identical services. daily payment methods.
However, upgrading existing real-time payment systems with newer technologies often comes at a high cost – which is why not all of the more than 5,000 financial institutions (FIs) in Europe have adopted online payments. real-time, according to Bernd Richter, SVP of global real-time payments for Europe and the UK at FIS.
Read Richter’s interview: More central banks will build new clearinghouses for real-time payments
Richter added that for smaller banks, sometimes “the business case just isn’t there,” indicating that it will be some time before the region becomes “a fully real-time payment system. “.
Increasing digitization also exposes more businesses to security vulnerabilities, another area that needs to be addressed as more insurance companies move their operations online. Forty-two percent of respondents said their growing reliance on technology made them more vulnerable to security risks.
See also: Valley Bank explains how to overcome obstacles to instant payments
Yet these companies are undeterred. Rather than scale back their digitization plans, the companies said they would tackle the issues head-on by investing in more robust security measures. More than 40% aim to increase investment in their security technology, while 40% also plan to hire dedicated cybersecurity staff.