A supercharging of trends has sparked a need for the greatest challenge in insurance innovation – revitalizing the landscape of claims processing. Forward-thinking insurers are beginning to leverage advancements in insurance technology, using AI to identify and solve customer pain points. Upgrading and implementing a host of new technologies frees up adjusters to focus on improving customer experiences and handling more complex claims, simply and seamlessly.
Claims have traditionally served as the heart of the insurance relationship. The claims process enables insureds to gauge the coverage and ease of doing business with the insurance company. Depending on the report, statistics indicate that between 40-60% are more likely to switch insurers after making a claim. Insurers with poor reviews could take a hit to their brand image and, ultimately, to their customer base.
Years of cost cutting have deeply affected insurance claims departments with often detrimental effects on customer satisfaction and attrition. “Claims operations that have been traditionally treated as outputs of a ‘reactive back office’ will have to become a powerful differentiator; innovative in nature, uncompromising on customer service, multifaceted in the capability of its talent, and capable of driving strong results,” according to Deloitte’s report, Future of Claims. “The key enablers to this future are a combination of process transformation, adoption of new technologies, a connected partner ecosystem, and a talent model that values technical claims handling and data science skills.”
How can organizations cut costs without negative effects on customer satisfaction?
A May 2021 Celent report gives a firm nod towards straight-through processing and improving the claims process. “Claims administration systems should evolve to take advantage of data, including information gathered through the Internet of Things (IoT), and how it can help with prevention, risk management, and customer service,” the report stated. “The final objective is for insurers to look at a claims administration system as a mechanism to solve the entire equation and fulfill the insurance promise with agility, accuracy, and timeliness. To ensure this happens, Celent believes “technology must serve as a strategic enabler in the management of this important function.”
By rapidly deploying AI and streamlining communications between insurers and insured parties, insurers can automate their core claims processes and experience immediate business and operational benefits. Nearly touchless processes for claims cuts cycle times to minutes instead of days, improving key levers along the claims value chain.
Open, next-gen core systems utilizing an API layer, can easily and seamlessly integrate third-party solutions which leverage AI in claims processing. Such solutions allow insurance companies to double their claims processing capacity without increasing costs.
As Celent mentions, an improved claims management process can be the key differentiator for a better customer experience. Allowing carriers to focus on customer pain points and allow them to drive efforts to find solutions.
Better Claims Process = Better Business
- Automating reduces claims operating costs by 36 percent, according to research by omni:us, which helps insurers revitalize their claims processes by deploying AI.
- Claims leakage decreases, reducing the amount paid out via intelligent governance of settlement decisions and cognitive decision support throughout for adjusters.
- With average straight through processing rates of 59 percent, only 41% of all claims require human intervention, for two thirds of which the manual processing time is reduced by an average of 62 percent.
Most importantly, customer and employee satisfaction will skyrocket.
Adjusters will also appreciate the enhanced workflows, while claimants are delighted by rapid response times and expedited settlements. Improving the claims experience will bring typically high rates of policyholder churn to a screeching halt. Bringing in new business is essential, but your existing customers need to get the same level of attention as your prospects.
Automated claims processing can benefit from the following key components:
- Cognitive & deep data extraction from incoming claims communication: Collection of all relevant information and generation of structured data from policy and claims documents
- Translation and classification of extracted data into parameters relevant to the claims process: Combining claims domain knowledge with validated data to automate decisions
- AI-powered decisions & recommendations: Automation of processes along the claims value chain and support of the claims adjuster with next best actions
New technology brings new business.
AI is rapidly changing the traditional space of claims insurance. Faster claims processing guarantees a better customer experience and less litigation. Insurers need a new technology that can facilitate the process. Only by building strong bridges between existing methods and future possibilities will insurers be able to forge ahead to a collectively successful future.