Today's insurance companies are leaving no stone unturned in their quest to compete and grow profitably. They face myriad challenges that include elevated customer service expectations, increased regulation, and rapid, unexpected market shifts. More than ever, performance and agility across an organization are keys to success. Many companies are giving their claim organizations new consideration, acknowledging the fundamental role it plays in determining financial performance and defining the customer experience.

Historically, claim processing has focused on the mechanics: gathering information and determining how much to pay and when to pay it. Today, insurers are beginning to move beyond this traditional approach, and even beyond first-generation process automation. They are looking to identify and leverage capabilities that expand real-time interaction with service providers, enable broad self-service options, and take advantage of services, such as automated subrogation processing and litigation management.

In general, insurers are looking to their claim operations to help drive improvements across three fundamental areas:

1. To improve retention and reduce risk. Often an insurer's first meaningful point of contact with a policyholder or a claimant is during a claim, a time when the claimant can be stressed and unsure of the process. This initial experience can make or break the customer relationship. Customer-centric insurers strive to make the claim process collaborative to improve retention, decrease the process and cycle time to close a claim, and reduce the chance of litigation. For example, if a claimant has just been in an auto accident, then he or she may call the insurer from the side of the road. The insurer can take the first notice of loss or send a taxi to take the claimant to a rental office where he or she can pick up a replacement vehicle to use while repairs are in process. This level of service reinforces the customer relationship and can reduce the chance of "claim inflation" or "buildup."