Hurricanes are becoming more frequent, intense, and expensive. Over the next 30 years, the forecasted average annual loss tied to hurricanes is expected to increase from $18.5 billion to $19.9 billion, with 13.4 million properties facing risks they haven't in the past.
As experts predict an unusually active hurricane season, the increased severity and area impacted will expand the volume of claims in the aftermath. Kenneth Defnall, President of Field Services at Davies, says insurance companies will need to rethink current strategies to manage these spikes,
"Advanced technology can help handle a larger pool of claims, support more adjusters with lower overhead costs, and prevent claims from getting lost in the shuffle due to volume challenges, leading to better customer outcomes," notes Defnall.
The ability to predict impacts, manage claims volumes at scale, and close claims faster provides insurance companies with a competitive advantage as natural disaster activity picks up.
Predicting Impacts & Claims Volumes
Handling large claims volume fluctuations requires visibility, which was limited in the past. However, Defnall notes that technological advancements have changed this scenario, as claims teams now access critical insights earlier.
"We use analytics tools to help predict impacts and claims volumes," says Defnall. "Once the storm makes landfall, those same tools manage claims volume and drive production for our field staff. The analysis also helps with location management for our field staff."
Defnall explains that his team also uses an in-house tool that leverages machine learning to review files based on specific client requirements. "It allows human staff to focus on the nuanced areas of damage estimates while machine learning addresses some of the basics," says Defnall.
Using machine learning while reserving higher-level tasks for human teams shaves an average of two days off claims processing time, notes Defnall. This timesaving is critical given the link between claims experiences and customer retention.
Improving Customer Experiences & Retention
Research shows that 74% of policyholders cited claims dissatisfaction as a leading factor for switching providers, particularly about claim settlement speeds. Of those dissatisfied customers, 26% said they had changed companies, and 48% reported considering it.
Technologies that support faster claims closures allow insureds to get on with their lives more quickly. "Waiting is always a pain point for policyholders; however, through more efficient claims management, we can decrease wait times and provide customers with timely settlements and a quicker path to recovery," says Defnall.
As more powerful hurricanes make landfall and property damages increase, efficiently handling these claims will provide a competitive advantage for insurance companies.
"We constantly review and test innovative technologies to enhance our processes and products," says Defnall. "We are discerning in our approach to ensure the technology positively impacts policyholders, adjusters, and our clients. Otherwise, the claims process can be frustrating for all involved."
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
