Five Drivers for Improving Incentive Compensation Management
The task of optimizing compensation management processes is significant, as it can bring numerous advantages to insurance companies. While many life, health, and P&C insurers have already begun the process of replacing legacy systems with advanced vendor solutions, there are insurers that are still behind the curve. With regulatory changes afoot – and competition from advanced competitors increasing – insurer interest in compensation management solutions remains high.
A recent research report by Gartner outlined many business drivers that spur insurers to take a closer look at this important area of operations. I would like to share the following five areas, which are some of the most common business goals that prompted our clients to evaluate and select VUE Software’s insurance compensation solution suite.
Increased efficiency: Many insurance companies rely heavily on personnel resources and specialized knowledge to manually manage some aspects of licensing and commissions. Legacy compensation systems may not provide the functionality needed to automate these processes. A robust automated solution can streamline much of the inefficiencies involved in a manually-intensive process for not only commissions, but also agent service and onboarding.
Improved sales force management: More insurers are reaping the benefits of access to in-depth reporting about the productivity of agents and agencies. Insightful reports and dashboards help management to fine-tune sales management and incentive strategies to achieve the desired results. Existing legacy systems rarely provide the business intelligence necessary to accomplish control at a peak level.
Automated producer management: Insurance distribution channels are often complex, with multiple-level reporting hierarchies, geography-specific licensing requirements, and elaborate appointing rules. Without a system that readily accommodates all aspects of producer management, insurers are still left to do manual workarounds. Advanced, insurance-specific compensation and distribution suites not only calculate commissions accurately, but also provide automation for several producer management and onboarding functions.
Decreased costs: With today’s mounting pressure on insurance costs, cost is nearly always a factor when evaluating compensation management solutions. As stated in the Gartner report, insurance customers typically find that VUE Solutions offer the highest value for the money among other vendors. Additionally, benefits such as increased efficiency, automation, producer self-service, and paperless processes can lead to decreased operational costs.
Ensured regulatory compliance: All insurers must meet regulatory guidelines. In particular, health insurers may need to make changes in the face of health insurance exchanges and other PPACA-imposed rules. It is imperative for insurance companies to choose solutions that not only meet business requirements, but provide flexibility for future compliance-driven restructuring as well.
These and more compelling business drivers are prompting more insurers to investigate advanced incentive compensation solutions. Is it time your organization did the same?
For more information on the Gartner MarketScope report, visit Gartner.com or firstname.lastname@example.org.