The future of claims technology

“The unfortunate reality that claims professionals know all too well is that critical details are lost to time and witnesses’ subjective memories,” said Michael Drayton, team manager, at Broadspire. “Smartphone-based telematics holds unlimited potential to capture unbiased collision-related information and greatly simplify and streamline the claims handling process.”

When it comes to processing claims, we need to relive the past, and we need to do it in as vivid detail as possible. However, when it comes to the claims process, adjusters and third party administrators (TPAs) need to stop living in the past.

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Common conundrums

We’re all too familiar with the expensive shortcomings of the status quo claims process:

• Delayed first notice of loss and lost data.
• Inaccurate or fraudulent data.
• Lack of reliable data sources.

These mundane problems result in low quality, biased data that negatively affect insurers’ bottom lines and customers’ satisfaction. Poor quality or missing data inflates the insurance industry’s costs to adjust and settle claims. This turns into higher prices for customers, frustration and volatile books of business. Fortunately, technology can remedy many of these challenges.

The solution in our pockets

Today, everyone carries a supercomputer — the average smartphone — equipped with GPS technology, accelerometers, gyroscopes and other sensors that can measure speed, force, location and more. They produce rich, unbiased data that results in better claims decisions.

This spring, a ride-hail driver was on duty, waiting for his next assignment. He topped at a red light and was hit by another motorist. A few weeks later, a ride-hail driver in a different city was at a pick-up location, waiting for a passenger, when a truck driver sideswiped him. Both drivers’ firms use a smartphone-based dispatch app equipped with driver analytics technology, so when the incidents occurred, the phones were automatically collecting telematics data about the events.

In both cases, the analytics technology tapped into the drivers’ smartphones to capture objective data for the firm’s insurer to review. They had the facts: what side of the road the driver was on, the direction their vehicle was facing, their vehicle speed, and whether they were speeding, driving aggressively or using their phones while driving.

The claims were settled quickly because of the high-quality data available and because it integrated into existing insurance business processes. No incident data was lost, so the third party administrator quickly determined these were real claims, and they established relative fault and severity. They completed the subrogation process quickly, got the drivers’ cars fixed fast, and the drivers were back on the job for their ride-hailing firms in record time.

With the right smartphone platform, the auto insurance industry can access rich, objective data with unprecedented speed after a collision occurs. This diminishes reliance on subjective evidence like witness statements and police reports. It means more informed and faster claims resolution, creating more accurate settlements, more satisfied customers and a better balance sheet.

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Saving lives, saving money

As more insurance industry leaders adopt smartphone-based telematics, they’ll be able to use the rich data they capture to build predictive models to resolve claims even faster, make better underwriting decisions, more accurately estimate the time needed to resolve claims and improve other insurance processes suffering from bad data and delays.

While today’s technology captures past events in better detail than ever before, it also lets insurance professionals see into tomorrow. It’s changing the way we process claims, predict risk and prevent casualties, saving money and saving lives.

Rob MacKethan, (insurance@zendrive.com) is a 30-year insurance industry veteran and head of Insurance at Zendrive.