Think about the last time someone on your team had to track down a document, wait days for an approval, or ask, “Did this claim ever go through?” If that sounds familiar, you’ve already met the Hidden Factory.
It’s all the manual work, quick fixes, and side-channel steps that keep the business running when systems fall short. In insurance, the Hidden Factory isn’t just inconvenient. It’s slow, expensive, error-prone, and difficult to audit. And the truth is, it’s far more common than most leaders realize.
In this post, we’ll explore what the Hidden Factory really is, where it hides in insurance operations, and how other insurers have eliminated it without rebuilding their tech stack from the ground up.
This is not an abstract idea. It’s what happens when people have to make systems work manually. You’ve probably seen it. Spreadsheets that no one owns. Approvals stuck in inboxes. Data entered by hand from scanned forms. Processes that only move forward when someone sends a reminder.
And of course, there’s Mark. Mark is the one person who actually knows how everything works. When Mark takes a day off, everything stops.
That is the Hidden Factory at work. It is the byproduct of disconnected tools and rigid systems that force teams to invent their own workarounds. The cost shows up as delayed claims, lost productivity, overworked employees, and compliance headaches.
If your organization has modern platforms but still depends on side workflows, you are essentially running two businesses. The one your systems can see, and the one your people quietly keep alive. Only one of those can be managed.
Insurance operations are complex by nature. Most carriers deal with legacy systems, strict compliance requirements, and large volumes of time-sensitive work. Each claim or policy moves through multiple departments before resolution, and every handoff is another opportunity for delay.
Even the best core systems leave gaps. Intake, routing, and collaboration often fall outside their coverage. Teams fill in those blanks themselves, and what starts as a temporary fix slowly becomes permanent. That is how the Hidden Factory grows, one workaround at a time.
A global insurer experienced this after a major acquisition. Teams in claims, underwriting, and customer service were struggling with manual intake, inconsistent workflows, and frequent delays. Errors increased, compliance risk grew, and the problem became impossible to ignore.
They turned to workflow automation to close the gaps. The solution connected document imaging systems with backend processes, automated intake and routing, and standardized approval flows.
The results spoke for themselves. The company avoided more than twenty new hires, reduced claims leakage, and accelerated processing across departments. None of this required replacing core systems. It was focused automation that made the existing tools perform better.
If you’re wondering whether your organization has one, the answer is almost always yes. It often appears in the same places.
Claims Intake – When staff re-enter data or double-check forms across platforms.
Eligibility and Enrollment – When requests come through email or PDFs and must be handled manually.
Appeals and Grievances – When compliance-heavy workflows live in spreadsheets or isolated databases.
Underwriting Handoffs – When updates rely on checking email chains rather than system notifications.
Audit and Compliance – When building a complete audit trail requires interviewing your own team.
If this sounds familiar, your people are covering for your systems.
You do not need to replace everything. You need to connect what you already have. The key is finding a platform that fills the gaps and lets teams adjust workflows quickly.
Look for tools that support low-code or no-code automation so operations teams can make changes without waiting on IT. Add case-based tracking to keep every task and document visible in one place. Automate repetitive tasks with bots and use built-in business logic to standardize decisions.
Integration is just as important. Connect systems through APIs or orchestration layers to end duplicate data entry once and for all. The goal is not to replace your stack but to make it work together as one.
Insurers can learn a great deal from how federal agencies handle similar challenges. Both operate in high-volume, compliance-driven environments with aging infrastructure.
One federal agency used automation to digitize onboarding, streamline training approvals, and centralize workload tracking across departments. The same approach can modernize claims, eligibility, and customer service in insurance without starting from scratch. It’s about building smarter, not bigger.
You don’t need a massive transformation plan. Start with one process. Map it, automate it, measure the impact, and move to the next.
Each improvement reduces delay, errors, and manual work while freeing your team to focus on what matters. Even Mark can finally take a vacation without everything falling apart.
If you want to uncover your own Hidden Factory, we’ve helped insurers and agencies do exactly that. Let’s talk about where you can start.
