What is the business culture? Are your IT systems working properly? Are things organized as they should be? With almost 6,000 insurance companies in the U.S. in 2016, it is clear that you need a process to review your business and IT practices. The option is to use an internal audit from a third party provider.
An internal audit will assess several of these aspects for your insurance company. An independent agency, such as a managed IT provider, usually conducts an internal audit of your IT safety and operations. Its purpose is to improve the workings of your organization and to make sure everything is working effectively and following the best practices of the insurance industry.
Management goes over all systems and operations during internal auditing. An internal auditor will help with each new challenge facing the insurance industry.
Performing an internal audit and IT assessment is vital for the safe, secure operation of your business in the insurance industry field. Here are 5 ways it can protect your company.
1. Ensures Rules and Regulations are Being Followed
Laws and regulations are constantly changing. How can you be sure that your company complies?
Regular internal audits will assure you and your clients that you comply with all the relevant laws and regulations directed at the insurance industry. Plus, it will demonstrate that you are doing so in a safe manner, protecting all your sensitive client information, including claims, payment information, and other personal data.
2. Unbiased Look at Business Processes
It is important to have an internal audit team to assess and audit each department in your insurance company without a conflict of interest. An unbiased and objective look at the various systems and operations adds value to your organization.
Plus, it can help you to see areas where you may be able to improve efficiency or reduce the amount of repetitive data collection.
3. Check and Address Risks
An internal auditor assesses, prioritizes, and manages your risks. He or she does this through a systematic risk assessment. The internal auditor will review data about changes to the environment. They will also suggest approaches to alleviating these risks, especially as it relates to your IT and protecting the data of your insurance clients.
4. A New Look at Organizational Change
An audit can be like a spring cleaning, leading to the addition of new ideas, new processes, and more resources for your insurance operations.
When internal auditors notice that a department needs more staff members, he or she will make that recommendation. Management will notice the need for improvement if the perspective comes from an unbiased auditor who understands the insurance industry.
5. Helps in Planning an Appropriate Investment Strategy
Part of an insurance company is investing the money collected from its clients to increase the funds available for claims. Having an internal audit will help your clients feel confident in how your company is handling their funds, thus ensuring that they will be able to have their claims paid because the funds are there.
With assets in the trillions, insurance companies need to be accountable for how they are investing and the results of their investments.
Internal Auditing Overview
An internal audit will review all aspects of an organization that are critical to your success from IT to financial controls.
Internal auditors provide an independent, objective overview and report their findings to your insurance company’s board and CEO. An auditor will highlight successes as well as necessary improvements.
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Sagacent Technologies offers technology management and support, including proactive/preventative maintenance, onsite and offsite data back-ups, network and security audits, mobility solutions, disaster planning, and emergency business resumption services. The company serves clients of 10 to 150 employees within the Silicon Valley region.