The term straight-through processing (STP) came about almost 15 years ago. Back then, the goal was to automate and digitize paper-based processes.
Today, sales processes are more complex and far broader. Yet the industry has still not succeeded in creating a cohesive experience. Most carriers and distributors are not even close to eliminating disjointed workflows.
In light of this, we proposed updating the definition of STP to one that brings insurance in line with other modern sales experiences.
Hurdles to Clear
The industry continues to face challenges to getting there. Single-purpose technologies obstruct the ability to achieve cohesive STP workflows. We as an industry need to find solutions. Many roadblocks stand in the way of truly modernizing the insurance sales process.
Disjointed Solutions
Advisors log in to multiple systems for their sales workflow. To open accounts, generate quotes, run illustrations and finally to complete the application. This is a disjointed, inefficient and—hardly least of all—laborious experience.
Disconnected Data and Data Entry Redundancy
Client data that the advisor has already collected is not flowing through the rest of the process. Advisors must enter the same data for account opening, quotes and illustration. This leads to data discrepancies and a higher risk of NIGOs.
Upfront Checks Happen Post Sale
Licensing, appointment and training checks are not always taking place ahead of submission. This creates errors at the carrier. It frustrates the advisor and slows down contract issuance for the client.
Inconsistent Processes by Line of Business
Firms often use different software solutions to complete the same process for every line of business. Built with different technologies, the advisor’s experience is inconsistent. They deal with different user interfaces (UIs), workflows and integrations. It is also quite costly for firms to customize and manage multiple solutions.
Different Requirements for Different Channels
More firms are diversifying into consumer solutions. Rigid UIs are not capable of supporting different user experiences. Firms are often required to use different software to support different channels.
Low E-signature Adoption
Many firms still have not implemented e-signature into their sales workflow. For those that have, it may be only used with one line of business. The other line of business may be on a separate software and require a separate integration.
The Encouragement of Paper
Disjointed workflows encourage paper submissions, which are prone to errors. Advisors are often already on the carrier’s website to get trusted rates. They may grab the paper application for submission while there simply to save a step. The process must be easier for the advisor to get the efficiencies that come with digital workflows.
Hurdles Beyond the Sale
Once a sale is completed, advisors are still battling with workflow breakdown. In post-sale activities, the carrier knows the contract data. Yet, the advisor is usually manually entering that data. This causes inefficiencies when supporting existing clients.
Inability to Enforce Processes
Disjointed workflows make it difficult for compliance to prove all steps in their defined process were completed. A defensible process is vital to compliance.
Modern Solutions for Modern Problems
Insurance has been trailing other industries for too long. Carriers, distributors and advisors need solutions. Modern consumers demand a streamlined sales process, and we need STP to give it to them.
Whatever the answers to these challenges are, we are not going to find them in 15-year-old technology.
Look out for our next blog post in our STP series. We will consider how today’s technology solutions can—at long last—truly modernize the carrier, advisor and client experience.
