How Claims Process Must Drive Change

The arguments surrounding the need for change in the insurance industry have largely been won. In recent years, dramatically increasing regulations, competition and customer expectations, along with dwindling resources and shortages of technical skills, have combined to produce an environment of uncertainty. All too often, insurance carriers have tended to push what they have been able to produce, rather than respond to what the customer demands. In a setting where that demand is changing radically, it is more important than ever that carriers step back and listen to customers. Enter "Connected Claims." As insurance’s "moment of truth," the claims process is where the service and delivery of an insurance-provider is judged, so it is natural that it should be a priority. But while the need is clear for a radical revision of the claims process, what isn’t clear is how organizations should undertake such profound and substantial transformational initiatives if they wish to deliver seamless, omnichannel and personalized, ‘Connected’ claims. Bringing about transformation in Connected Claims is not simply a case of refreshing or reorganizing a single department. It has the potential to disrupt – and revitalize – an insurance carrier’s business in its entirety. In our Connected Claims Report 2019, we find out how insurance executives view the challenge of creating a connected ecosystem within claims, where their challenges lie and what their expectations are in the near to mid-term. See also: The Connected World: How It Changes Claims   Our research discovered that no department is unaffected when a carrier undergoes claims transformation, but there are certainly some departments whose influence is pivotal. Between two-thirds and three quarters of respondents cited claims, IT and analytics as the "holy trinity" that drives transformation. To be successful, however, means more than just focusing on internal capability. Although the need for introducing Connected Claims is largely understood, customer service has recently become a key battleground, with the likes of Lemonade and Metromile disrupting the market with quick, personalized and mobile-friendly offerings. A focus on the customer is more than just good business practice. Understanding customers’ needs is the foundation for instigating cultural change. Our research reveals something of a paradox, where the majority of carriers believe their claims process is at least satisfactory but know the time is ripe for a change, and yet many feel unable to persuade their organization to release the necessary resources. Understanding customer motivations, as well as the technical landscape, may well be the evidence that executives need to secure that investment. While transformation may seem to be a radical process, executives are still focused on getting foundational processes in place before moving on to the more experimental technologies. Our research showed that four key areas will demand most of carriers’ attention in the near to mid-term: digital, data, claims technology and AI. It was interesting to discover that this last element is still being viewed with trepidation, particularly by North American executives. Delving deeper into the results, we find that many are already deploying AI-related capabilities, even if they don’t define them as such. The results of the survey show there is clearly a need for greater understanding of the range and capability of the new technologies at carriers’ fingertips. Connected Claims transformation is well underway. We can expect to see a greater shift toward automation and AI-based processes in the next five to 10 years as carriers become more confident that the foundational elements of data, IT and analytics are in place to support the change. But however advanced carriers’ technical capabilities become, focus on customer needs will always be the driving force behind any strategic change. See also: How Connected Cars Will Change Claims   Please download this full report here and get more insights on Connected Claims. This report was produced in conjunction with Insurance Nexus’ coming Third Annual Connected Claims USA Summit 2019, taking place June 5-6, at the Marriott Marquis in Chicago. Welcoming more than 750 senior attendees, Connected Claims USA is the world’s largest gathering for claims executives striving for efficient, customer-centric clams processing. More information can be found on the website at https://events.insurancenexus.com/connectedclaimsusa/.