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How to test the application of the insurance domain

how test insurance domain application

Role of Testing - Learn how to test the insurance domain application:




In this tutorial, you will learn how to test an insurance domain application and which modules to test in an insurance application.



Every insurance company relies more on different types of software to help them run their business. This software application helps you create a new policy, register members, manage policies, and more.

Literature Recommendations => If you want to learn the basics of the insurance domain, you can read this tutorial.



What you will learn:

Insurance domain overview

As we all know, the insurance industry is broadly divided into different sectors such as life insurance, car insurance, property insurance, health insurance, etc.



On the other hand, there are some complex functions like policy management, claims, underwriting, etc. that make the insurance domain very different from the other domains.

Testing software is critical to an insurance application. Testing shows whether an application is suitable for use or not, and performs an end-to-end process from creating a new policy to finalizing claims.

All insurance companies maintain the IT infrastructure and believe that they have also made an investment to ensure that their application runs successfully or not in real time.

Tests prove the robustness of an application, so insurance testing is of the utmost importance.

Importance of examining insurance applications

Nowadays, the insurance industry is widespread in various fields like life, auto, health, property, etc. With such a wide range of coverage, they have different software or products to suit the needs of the end user. Sometimes there is a chance that the same insurance product will move quickly in one part of the country and slowly in some other parts of the same country.

With such a wide variation, insurance companies take into account the needs of their local customers and manufacture products according to their needs.

Now testing becomes a complex task when there is such a requirement where the product features ultimately vary in the same country. Therefore, testing an insurance domain application is required to ensure that the insurance product meets or does not meet local customer requirements.

In this current digital world, each insurance company uses different technologies to maintain their software, which in turn helps reduce costs and improve customer satisfaction. Insurance companies also spend money to keep their customers' data safe. Several insurance companies have even started showing their footprint through mobile applications.

Insurance framework

The insurance industry is broadly divided into various sub-sectors such as Life, Auto, Property and Health etc. Each sub-branch has different functional areas and modules to be tested.

The following is an example of an insurance framework that includes different modules:

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Different modules for testing an insurance application

Each insurance company is divided into different business areas such as policy management, underwriting, claims management system, etc. Each area has its own processes and standards that must be followed. In this section, we will learn about a few key areas that are crucial when testing insurance applications.

Here I've mentioned different areas of the business in an insurance industry and the areas that you need to focus on when testing an insurance application. Of course, there are other functions in each area that are important and vary from organization to organization.

Testing the claims management system

The Claim Administrator software simplifies the claims process for the insurance company and is also known as the “Claim Management System”. This claims management software starts its workflow from the initiation of the claim to the final settlement of claims.

Claims management systems help reduce costs for the company by using various techniques, tools, and removing manual processes, reducing manual errors, etc.

Testing the Claim Admin system includes:

  • Claim the life cycle
  • Entitlement assessment
  • Claims processing and transaction
  • Processing of policy transfers
  • Due processing
  • Payout facility

Testing the policy administration system:

The name itself indicates that it is an administration system for policy management. The personal customer data and the associated coverage data are stored in this policy management system. Since it includes various functions for testing, this is considered to be the crucial part of testing.

Some of the features are listed below ::

  • Policy Workflows or Policy Lifecycle
  • Financial and non-financial transactions
  • Document management and processing
  • Change of cover
  • Premium due alert
  • Cancellation, renewal of policies
  • Modification of the customer's personal data
  • Policy Loss Processing

Testing the underwriting module:

If an individual decides to purchase a policy, it is the insurer's responsibility to assess the risk associated with the individual before accepting the application. Underwriting is a risk assessment process in the insurance company that enables the company to assess the risk and determine the premium for the insured person accordingly.

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The underwriting module mainly consists of testing:

  • Complex business rules
  • Evaluation efficiency
  • Underwriting quality
  • Check the medical history
  • Check the course of travel

Testing the New Business Administration:

Risk management plays a key role in the success of an insurance company.

From the test perspective, the following points must be observed when testing:

  • Quick and detailed offer to your customers.
  • Provide service details to the customer.
  • Check the tariff system structure of the competitors.
  • Batch job schedule and run.

Testing the policy offering system:

It is always necessary to make the customer an initial offer according to his requirements. There are different types of customers who require different coverage. Therefore the Policy Quote System has to be tested.

The following are the key points to consider when testing a policy offering system:

  • Review the tariff structure which will be helpful in creating an offer.
  • Validate the plans according to customer requirements.
  • Review the policy effective date.

Tips for testing the insurance domain application

Now we are going to use a few examples to see how important it is to test an insurance application.

In the insurance industry, there are different roles and permissions for each agent or broker (here we will refer to them as a “user”) who performs / completes his task and then moves on to the next phase. No two users have the same roles or permissions that conflict with the completion of the task.

# 1) Application roles and permissions:

For example Let's consider the following roles and responsibilities. If any of the roles / responsibilities in production are wrong, it creates a huge mess for the insurance company.

  • The insurance agent submits the application for an insurance policy to his customer.
  • The insurer assesses the risk and decides whether to accept or reject the application.
  • With the acceptance of the risk and application, the policy is created according to the benefits or plans requested by the client. The policy is created using the insurance company's software application

Now in the process above, imagine if any of the steps go wrong and if the policy is being created with the plans that were not requested by the customer. OR when access is given to an insurance agent to accept or reject an application? When something goes wrong in the real world, the insurance company loses confidence in the market and it becomes difficult for them to continue their business.

This will be a huge loss for the insurance company and they may even lose their market standard. Therefore, software testing plays a critical role in testing insurance applications.

In our example above, tests ensure that all roles and permissions are granted to the appropriate user and that the end-to-end flow is carried out correctly or not. Software testing is essential to avoid business abnormalities and the end user accepts the final quality of the insurance product or software application.

To test an insurance application, you need a knowledgeable testing team that is also an expert in the insurance field.

The example given above is just a simple example. There are several areas such as entitlements, pensions, policy management, quotation system, rating engine, etc. where testing is a necessary part to ensure that the application works correctly.

# 2) Information interface:

When testing an insurance application, you must verify that the information on the front end has been correctly updated and successfully stored in the back end system or database. In addition, the stored information is fetched error-free from the database front end.

# 3) Number factor:

Insurance is a numbers game and many insurance companies are sensitive to these numbers.

A small change in the premium can make a big difference in the bottom line. So be sure to check all decimal places, and proper math calculations are important when testing insurance applications.

# 4) date factor:

Appointments are also very important in the insurance application.

Effective Date is the date on which the policy takes effect. Even if the policy is changed, the effective date will change, so you need to carefully enter the data and test that this data is reflected correctly in the policy plans.

# 5) Test end-to-end insurance application:

You need to validate the following points while testing an insurance application ::

  • The offer is generated and the customer accepts these offers.
  • The guideline number is generated with a corresponding plan.
  • All personal data and policy details are updated in the policy management system.
  • Members and their relatives are enrolled in accordance with the respective guidelines.
  • A corresponding commission is generated in the system.
  • Brokers need to be able to view their customers' information through the front-end application.
  • Customers must be able to view and change their data via the online portal.

# 6) Think from a business perspective:

Understand the insurance business and test the end-to-end process correctly. You need to go beyond your limits and think 'Out of the Box' identify the shortcomings.

Think from the end-user perspective and test the application. You need to be very careful when testing, because if a change in the number, date or registration details is changed on one screen, it will reflect this on the other screens as well.

Performance tests in the insurance sector

Insurance applications have multiple lines of business and each area has different validations, checkpoints, complexities, etc. There are critical areas of the front-end application for claims management, policy management, members or brokers that have maximum transactions or activity.

Hence, the performance of these applications is most important. In this tutorial you will learn more about the best way to test the application of insurance domains.

There are various activities like multiple application processes, multiple policy renewals on the same day, or broker applications that are continuously submitted through the front-end application, etc. It is therefore important to test whether or not the server is responding appropriately.

For example, An insurance application must be tested with several claims (e.g. 1000) at the same time from several hospitals to ensure that the system processes all claims successfully.

Load testing makes it possible to check the threshold, and stress tests ensure the maximum peak limit of transactions that the system will fail and successfully determine where it has failed.

The following is a list of different tools that can be used to test an insurance application:

  • LoadRunner
  • JMeter
  • WebLoad
  • Silk artist
  • Rational performance tester

Automation tests in the insurance sector

Automated software testing is one of the challenges in the insurance sector.

Deloitte highlighted in its report that the insurance industry is facing a significant disruption and traditional business models can pose a challenge to the industry. Efficient tests carried out for each application can significantly reduce the number of production errors.

Below are the 3 parts to automating an insurance application or software:

  • Creation of an automation framework
  • Writing business test scenarios
  • Assessment of the test status of the software

Key benefits of test automation for an insurance application:

  • consistency : Continuous testing is required to ensure that the application works or not even if the features are changed. With the help of automation tests it is possible to run a test suite without manual errors.
  • Reusability : Automation tests make a test reusable and reduce costs.
  • Reduces costs and speeds time to market
  • Automation is becoming highly scalable and easy to maintain.

Challenges in testing insurance applications

The application of insurance is complex and critical, and several challenges arise in examining insurance applications.

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The above picture shows some challenges.

Let's quickly understand these challenges:

  • People : Many organizations lack testers with knowledge of the insurance sector. Domain knowledge is very important from an end-to-end perspective as you know all business processes.
  • Processes : Quality processes and best practices help every project to be implemented successfully. Ignoring such processes and practices can add enormous cost to the project. Many organizations that lack best practices and processes may fail.
  • Technology: Various tools and technologies help reduce the overall cost of the project. In today's digital world, it may not be possible for every project to implement these tools and technologies. There are various reasons for this, such as the cost of a tool, knowledge of the technology or the tool, etc.
  • Regulations and supervision: As new technologies emerge, the rules and regulations for an insurance industry are being revised accordingly. In some cases there are some complex rules that can even hinder the quality inspection of an application.
  • Competition: On-time delivery and minimal cost are the key factors to keep the customers and their satisfaction. New technologies and the provision of “new or additional” advantages for customers as well as project execution ensure that you stay ahead of the competition in the market.
  • Time: In each test phase, an application should be available for testing at the right time so that each test team has enough time to thoroughly test an application.

Test scenarios for testing insurance applications

In this section, we will learn about the different types of insurance scenarios that are generally important when testing insurance applications.

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Let us begin.

  • Check that the customer can successfully enroll for the insurance benefits.
  • Check that the system allows changing the existing policy for adding a new coverage or plan.
  • Check that the system can change or update the customer's personal information.
  • The system should be able to cancel the policy.
  • Check that the agent's commission has been calculated correctly.
  • Make sure the additional amount is refunded to the customer if the payment is more than the amount due.
  • Check that the system can process the payment by NEFT, check method, etc.
  • Verify that the process of changing the annuitant completed successfully.
  • Check that a new payee has been successfully updated in the system.
  • Check to see if you get an error message adding an incorrect driver code to the policy.
  • Verify that the drivers have been successfully added to the existing policy.
  • Verify that the member registration for a policy was processed successfully.
  • Verify that the rates have been generated according to the policy plan and structure.
  • Check that the policy generated in the agent system is automatically available in the offer system.
  • Verify that the policy change was processed successfully.
  • Check the applicable coverage in the policy.
  • Use the policy number or name to verify that the policy is searchable.
  • Verify that the policy renewal has been processed successfully according to customer requirements.
  • Verify that the proposal for the associated policy plans was successfully generated and sent to the policyholder.
  • Verify that the claim has been processed successfully.
  • Verify that the policy effective date has been updated by adding a new plan.

Sample test case for an insurance application

I provide a sample test case based on an imaginary process and covering almost any system or application such as agent system, management system, commission or broker system, registration system, etc.

Please note that this process is only on an imaginary basis.

Step nodescriptionExpected result
Step 1Once confirmed by the customer, verify that the insurance agent can make an initial proposal for the systemThe first offer should be made according to the customer request.
step 2The initial "case" is generated and navigated to the drawing system and the quotation systemThe proposal should navigate to the quotation system to generate the policy
step 3The policy was successfully generated with the correct effective date and policy plan as per customer requirementsAfter the appropriate risk calculation, the guideline number should be generated for the customer
Step 4Check that the policy is passed from the underwriting and quoting system to the admin systemThe administration system should now have the policy number and the associated plans
Step 5Make sure that all members, dependents and their details along with the policy details are updated in the registration systemThe registration system is updated with the policy details
Step 6Make sure these details have been successfully forwarded to the admin systemNow the admin system should contain all of the policyholder's personal details along with the associated policies and plans
Step 7The administration system checks all details and calculates the agent commission and is forwarded to the commission systemThe commission system should be updated with the agent / broker's commission
Step 8Verify that the policy document and premium details have been generated along with all terms and conditionsAll documents should be generated and sent to the policyholder's address
Step 9Verify that the personal information was changed successfully even after the policy was registeredAfter registering the policy, personal information should be updated
Step 10Make sure that new benefits or plans can be added / removed / changed successfullyNew plan should be successfully added / removed / updated in the existing policy
Step 11Make sure that the policy effective date is updated correctly after changing the existing policyAfter changing the existing policy, the effective date should be updated correctly
Step 12Once verified, verify that the claim request has been acceptedClaim request should be successfully accepted and transmitted to the associated subsystem
Step 13Check that the application has been processed successfully and that the payment is made to the appropriate beneficiary / policyholderThe claim amount should be credited to the policyholder / beneficiary
Step 14Test ends

Conclusion

In this tutorial we got to know the different insurance areas and learned what kind of tests need to be carried out in each area. We also saw the key aspects of insurance and the various terminologies used to test the application of insurance domains.

I hope the scenarios and the example end-to-end test case will definitely help you to clearly understand the insurance concepts and how they work from another application.

Are you an insurance tester? Would you like to add something interesting to this tutorial? Feel free to express your thoughts in the comments below!

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