How to leverage claims tech for speed & customer engagement
Being ready vs. being reactive: The proper use of insurtech will set insurance companies apart from one another.
The insurance industry is slowly undergoing a digital transformation, with the personal lines insurance sector moving a bit more rapidly to adopt insurtech and technology solutions than commercial insurers.
But whether it’s for a complex or simple claim, customers expect a modern claims experience that matches how they handle other transactions, from online banking to grocery shopping. They want more accessibility to the claims process, quick settlement of claims, and a seamless and efficient process.
When disaster strikes, however, resourcing issues can make it difficult for commercial insurers to meet their business customers’ speed and efficiency expectations. Introducing automation for commercial claims can balance a digital transaction with the human touch.
Appetite for tech?
One barrier for commercial insurers is reluctance to invest a significant amount of money in updating the claims process. Insurance companies prioritize how to sell more insurance, keep premiums competitive, or retain customers. There doesn’t appear to be the same appetite for investing in technology that will speed up claims processing and provide more control and engagement to the customer. While a $18,000 business interruption claim may be de minimus to the insurer, this claim is incredibly significant to the individual business that needs the $18,000 because they were closed for a week after a catastrophic event. That business owner wants to move that claim through the process as quickly as possible.
The current standard for processing a commercial insurance claim features multiple systems, many steps, and significant human intervention and handoffs, slowing the process from the time an insurable event occurs until the customer receives a payment. Using technology and innovation presents the opportunity for streamlining the entire claims process, including:
- initiating the claim and customer access;
- providing a platform for claim documents;
- using that same platform to manage claim status, deliver supporting documentation and issue automated updates;
- providing a simple dashboard to calculate and display financial damages; and
- making a final determination and settlement confirmation.
Linking that system to an automated payment gateway makes the claims process more effective and efficient while enhancing customer satisfaction.
Managing claims 24-7
Insurance customers want to deal with their claims at their convenience — day, night or the weekend. The human element and the limited availability of insurance professionals can slow the process down in several ways:
- an adjuster with dozens of claims to process;
- limited office hours and constrained schedules of insurance professionals; or
- an email that goes unanswered because someone is out of the office, has a mediation or training, or is just busy elsewhere.
These bottlenecks can be removed and eliminated by a self-service, on demand technology-focused claims platform. Such an insurtech solution will not only digitize an analog process already in place. It can give the claimant more control over the claims process and shorten the time between insured event and payment while maintaining the necessary compliance and due diligence. Making the claims process more efficient also may free insurance professionals from basic administrative and processing tasks, enabling them to focus on more complex claims issues.
The right technology solution can help a company solve the talent issue that all sectors of the economy face. Since so many steps in the traditional claims process require human intervention, the right platform can streamline the process through automation while creating consistency in the claims process journey, regardless of talent shortages. When a claim requires further conversation or investigation, claims professionals can step in.
Choosing the right solution
However, commercial insurers face the risk of technology choice overload. Commercial insurers are treading cautiously into insurtech, looking for innovative technology to use as a testing ground for certain non-complex property and casualty claims. Insurance companies have a patchwork quilt of systems, grown through mergers and acquisitions, that don’t necessarily communicate well with each other. Adding a plug-and-play insurtech solution is usually not the right choice. Companies will likely consider an existing technology modified to fit their specific strategic needs. Because of this need for a custom solution, more startups are entering the insurance market, creating new claims cloud solutions that insurers can pull off the net and customize.
One way insurance companies can go wrong when choosing a technology solution is that the right stakeholders may not be involved in the decision or planning process. There may be a disconnect between what the company is trying to do in terms of efficiencies and money saving, and the experience of employees and departments who actually use the new system.
Over time, commercial insurance customers will become increasingly comfortable with automation. The proper use of insurtech will set insurance companies apart from one another as they battle for renewals and new customers alike.
For now, early adopters of automation for commercial claims are balancing both a digital solution and the human touch.
Simon Oddy is a partner at Baker Tilly. He works with insurers and lawyers in North America, South America, Europe, Africa, Asia and Australia.
Bernard Regan is a principal in the global forensics consulting practice at Baker Tilly. He specializes in the application and management of computer forensics processes, including cyber security and digital forensics.
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