How to Test Insurance Domain Application

Role of Testing – Masterful Testing of Applications within the Insurance Sector:

This instructional material aims to walk you through the steps in inspecting an insurance sector application. It will also point out the different modules that are crucial in such an application.

Insurance organizations heavily depend on various software to efficiently conduct their operational procedures. These software applications are essential for creating policies, registering members, administering policies, and more.

Suggested reading => To enhance your understanding of the insurance sector, we recommend you review this tutorial on the basics of insurance domain.

Getting to Know the Insurance Domain

As most of us are cognizant of, the insurance sector encompasses assorted domains such as Life Insurance, Auto Insurance, Property Insurance, and Health Insurance.

The insurance domain operates noticeably complex functionalities such as Policy Management, Claims Processing, and Underwriting. This complexity distinguishes it from other sectors.

Software testing plays an indispensable part in insurance applications, as it verifies if an application is suitable for usage and confirms the end-to-end processing flow from policy formulation up to the final claim settlement.

Every insurance company invests in IT infrastructure to ensure efficient operation of their software applications in real scenarios.

Through software testing, insurance companies reassure the robustness of their applications hence attesting to the vital nature of insurance testing.

Need for Testing Insurance Applications

In the modern era, the insurance industry covers a variety of sectors such as Life, Automobile, Health, and Property Insurance. Different sectors entail different software or products designed according to customer requirements. A single insurance product may observe a varying level of acceptance in different regions within the same country.

Owing to these significant differences, insurance companies take into account the specific demands of their customer demographic while developing products.

Testing an insurance domain application is crucial to certify its alignment with specific customer needs.

In today’s digital age, insurance companies employ distinct technologies to streamline operations and augment customer satisfaction. They also invest hugely in securing data to safeguard customer information. Hence, many insurance companies have now switched to providing mobile applications to improve the services they provide.

Understanding the Insurance Framework

The insurance industry includes a range of sectors such as Life, Auto, Property, and Health insurance. Each of these sectors includes varied functional areas needing inspection.

The Insurance framework consists of different modules, which are summarized as follows:

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Key Modules for Testing Insurance Applications

Insurance companies function across various areas such as Policy Administration, Underwriting, and Claims Management Systems. Each area maintains its own specific processes and standards. In the following section, we discuss some key areas demanding careful testing in any insurance application.

Here are some key Business Lines within the insurance industry, and the focus testing areas for an insurance application. Additional functionalities could be present in each area varying from one organization to the other.

Inspection of the Claim Administration System

The Claim Administration software simplifies the claims process for insurance companies and is often referred to as the “Claim Management System”. These Claim management software solutions oversee the full claim lifecycle, from the initiation to the final settlement.

Claim administration systems reduce costs by using various techniques and eliminating the need for manual processes, therefore averting errors.

Testing the Claim Administration System includes the following:

• Full Claim Life Cycle
• Claims assessment
• Claim processing and transactions
• Policy surrender processing
• Maturity processing
• Setting up Payouts

Testing the Policy Administration System:

As the title implies, the policy administration system manages the policy. It stores customer’s personal information and related coverage details. This system includes several functionalities that need to be tested, making it essentially important in the overall testing process.

The below functionalities should be thoroughly tested:

• The life cycle or workflows of a policy
• Both, financial and non-financial transactions
• Document management and processes
• Changes in coverage
• Alerts for Premium due dates
• Policy renewals and cancellations
• Modification and Management of customer’s personal details
• Processing policy lapse

Testing the Underwriting Module:

Underwriting refers to the process of risk assessment within an insurance company. The underwriters evaluate the risk attached to potential policyholders prior to accepting their applications. This assessment determines the premium amount payable by the insured.

The following activities mainly occur during the testing of the Underwriting Module

• Complex Business Rules
• Rating efficiency
• Quality of Underwriting
• Check the medical history
• Review the driving history

Testing Business Administration for New Businesses:

For securing the success of an insurance company, Effective Risk Management is key.

During testing of the New Business Administration module, focus should be given on the following:

• Offering a speedy and detailed quotes for customers
• Provide benefits details to customers
• Compare rate structures with those of competitors
• Schedule and perform batch jobs

Testing the Policy Quotation System:

The Policy Quote System is responsible for the creation of initial quotes according to customer’s requirements. Different customers demand different coverages and hence, testing this system becomes essential.

Key points for consideration while testing the Policy Quotation System:

• Validate the structure used for generating the quote.
• Validate plan options according to customer’s requirements
• Verify the effective date of the policy

Tips on Testing Insurance Domain Applications

We will now look at the importance of testing insurance applications with some examples.

In the insurance sector, each insurance agent or broker (also referred to as “