New factors driving demand for digital innovation in claims intake

The demand for digital innovation is moving quickly into the claims intake process, and not only as a way to make contact centers more efficient and cost-effective.

A new NetClaim survey of TPAs and carriers shows that insurance executives now view the need for greater agility, fraud protection and quality control as key components of their push to innovate the claims intake process, a function that has long been seen as commodified and static is now facing many of the same market forces as the rest of the insurance industry.

More than 90% of TPAs said innovation was needed in the claims intake and distribution process, while more than 70% of carriers shared that view, according to the survey.

The top factor driving this demand is the need for greater quality, efficiency, and reduced expenses — selected by 68% of carriers surveyed. But just behind those more traditional factors are a new set of priorities for claims intake: quality control specifically and fraud detection, which were selected by 64% of carriers.

How are TPAs and carriers responding to these new demands? Increasingly they are looking outside their walls for claims intake and digital solutions.

Precisely 90% of TPAs and 78% of carriers agreed that claims intake and dissemination vendors are valuable partners. It’s clear where the industry is heading, but where do TPAs and carriers start when it comes to introducing digital changes to claims intake and working with outside partners as the study shows is occurring?

Related: Changing times ahead for insurance claims industry

Where to start

Rather than an overhaul of claims intake across the company, carriers and TPAs can start the digital transition by focusing on particular insurance lines that lend themselves to automated claims intake.

For example, workers compensation and auto liability insurance lend themselves to automated intake given the distributed environments in which these incidents can take place. Automation and outside specialists can prove themselves here, meeting the demand survey respondents demonstrated for not just settling for cheaper claims management, but also quality assurance and fraud detection at a meaningful and sustained scale.

Survey participants may be responding to the fact that “cheaper” can also turn out to be more expensive when mistakes require expensive labor from adjusters or the legal system. While the discipline of specialists on the front end helps and can be worth the investment, that investment can be amplified through well-executed automation.

Testing digital automation solutions on relatively small or straightforward claims is a way for carriers and TPAs to gauge the technical and administrative ability of outside partners, and to find the balance between human and automated intake as we’ll see.

Catastrophic claims are another place where insurers can see immediate benefits from the deployment of digital intake and outside partners, in large part because while you can scale with on-call contact centers, digital can take that even further so demand can be fully and effectively met when disaster strikes.

Human versus web

The balance between human and automated intake wherever a carrier or TPA starts cannot be underestimated.

At the moment, most claims on the consumer side of the market are still communicated over the phone, but many in crucial market segments — think millennials — would prefer not to call it in. This is likely one driver for the call for claims innovation found in the NetClaim report, as well as a LexisNexis survey.

There are myriad benefits to web-based intake: consumers can file themselves on whatever device they choose 24 hours a day; contact centers aren’t overloaded; and customers can upload images or video on the spot. It is understandable why this might push carriers and TPAs who aren’t trying to be the cheapest, but the most trusted, to search for partners with automation expertise.

Yet there is still an important human component to the claims intake process — many customers still seek a face-to-face or telephone call with a person when filing a claim, especially a complicated one, the Accenture study found. An outside partner needs to comprehend how to address this.

Bringing a strong rules engine into the process allows insurers and TPAs to scale up claims intake rapidly and complements, rather than replaces, intake professionals, who can focus their efforts on customer experience for those who need a human to guide them through the process. This can be challenging to build internally, and more importantly to manage and keep up to new technical standards the rest of the world expects. Tasking an outside partner to focus on this takes an administrative load off the internal carrier or TPA team.

Carriers and TPAs are making increasingly big changes to their processes now. Those with an eye to the future and dominance, are making those moves in a strategic manner with carefully selected outside partners that go beyond superficial updates to the same old business model, and are looking to jump out ahead of the competition in a way that sets them apart as leaders.

Related: The regulatory benefits of modernizing claims

Haywood Marsh is General Manager of NetClaim, which offers customizable insurance claims reporting and distribution management solutions. He can be reached at HMarsh@navexglobal.com.