Digital transformation and document management

Insurance has traditionally been among the most paper-intensive industries. However, the cross-industry trend toward digital transformation is calling for change.

Piles of paperwork can translate to clunky, slow and confusing claims processing for all parties involved. Consider the paperwork involved when a policyholder submits an auto insurance claim. This can include proof of loss forms, medical bills, repair bills, police reports, even receipts for associated expenses (like renting a car).

Having so much paper on hand can be an Achilles heel, for several reasons:

• The physical aspect of exchanging paper between agents, offices, and even countries (in the case of a multinational insurance company) is often inefficient and slow – leading to delayed claims reimbursements and unhappy, inconvenienced customers.
• Sensitive data contained in physical documents is prime for a security breach (through loss, accidental misplacement, etc.) as it is manually passed from one person to another. While “data security” tends to make people think of fortifying their networks and servers against cyber hackers, paper continues to be significant origin of data breaches in many industries.
• Backtracking and tracing a particular document’s path (and the exact employee who acted upon, or made a decision, based on data contained within that paper) can be extremely difficult and time-consuming. However, insurance companies face this challenge whenever a policyholder questions a denied claim or takes legal action, or when a state conducts an audit to ensure rules compliance. Insurance companies are held to a high standard, and policyholders expect prompt communication and quick claims processing. With paper scattered across the enterprise, meeting these expectations can be challenging.

Many insurance agencies may feel overwhelmed by the prospect of change, but in the digital age they must adapt if they hope to thrive. Industry leaders are raising the bar on policyholders’ expectations for faster, more convenient claims reimbursements — initiatives like Aflac’s One Day Pay is a prime example. Fortunately, there are several simple, straightforward steps that can help insurance companies get paper under control, once and for all:

Digitize

The first step is to transform paper into a digital format. This may conjure up images of back-end office workers spending hours scanning documents, but that is no longer the case. Today, there are solutions available that scan in bulk — enabling thousands or even millions of documents to be scanned into digital format, categorized and saved using cloud infrastructure resources, all with minimal human intervention.

Support claims reimbursement with digital workflows

Once paper files are digitized, traditional online document management solutions that enable data storage and retrieval should be revamped. That entails incorporating digital files seamlessly into digital workflows — an automated online business process where tasks, information and documents are passed from one worker to another. A digital workflow is like the central nervous system for claims processing, disseminating relevant information to all those involved in the approval cycle to fully manage and expedite the process. Studies from the medical claims industry have shown that digitized claims take 30% less time to process than paper-based claims.

Integrate mobile into digital workflows

All employees should be able to engage in the workflow, including those who may work remotely and use mobile devices. For example, insurance adjusters should have the ability to submit pictures and other records directly into the claims workflow, eliminating delays gathering information required to process the claim.

Automate security

While digital workflows present many speed and efficiency advantages, they do not eliminate human error or data compromises entirely. Any time a worker can submit information directly into a system, there’s a chance for fault. For example, a worker submitting forms containing personal health-related data could send the data to a file accessible to unauthorized workers.

Research shows that organizations are 50% more likely to suffer accidental data exposure through errors in document handling than an outside data breach. This is unfortunate given that managing internal workers’ habits is generally easier than keeping up with constantly evolving (and unknown) external cyber threats.

Organizations should consider supplementary steps to protect sensitive data running through digital workflows. One example may be identifying and redacting personally identifiable data in documents containing healthcare details (like a policyholder’s social security number). In this case, even if the document makes its way into unauthorized hands, the policyholder’s privacy is still protected. This type of automation can be the key to maintaining high levels of worker speed and efficiency without compromising data security.

Pain-free “paper” work

The insurance industry is primed for the benefits of digital transformation. Policyholders submitting claims tend to be nervous or upset, so the ability to expedite claims processing efficiently, accurately and securely is a huge competitive differentiator. The notion may seem simplistic, but replacing antiquated paper-based claims processing through the tips outlined above can be a critical first step on the path to digital transformation.

Tracey Mustacchio is senior vice president for Nuance Document Imaging. Contact her at tracey.mustacchio@nuance.com.

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