Making the Claims Process More Efficient

Technology can transform traditional practices, elevating efficiency and enhancing overall policyholder experiences.

December 8, 2023

In today's digitally driven landscape, insurance companies must implement efficient processes to enhance the claims process, both internally with insurance professionals and externally with policyholders. Technology serves as the catalyst for transforming traditional practices, elevating efficiency and enhancing overall policyholder experiences. The integration of technology not only addresses longstanding inefficiencies but also opens doors to opportunities, positioning the industry at the forefront of innovation.

Navigating the Challenges of Technology Adoption in Insurance

While there are many benefits to technology adoption, it is important to consider the challenges faced by professionals and policyholders. Key challenges include:

Reliance on Archaic Systems: Traditional claims processes often hinge on outdated systems, impeding the seamless integration of modern technologies and slowing the industry's overall progress toward digital transformation.
Resistance to Technological Adoption: Insurance professionals resistant to embracing new technologies contribute to an industry that remains stagnant.
Devaluation of Policyholder Relationships: Antiquated processes in the claims system can lead to the devaluation of policyholder relationships. Delays in claims processing due to outdated methods erode the trust that policyholders place in their insurance providers.
Indemnity Leakage and Escalating Expenses: Delays in traditional claims processes contribute to indemnity leakage, where insurers may incur higher costs due to prolonged processing times.
Impact on Policyholder Acquisition and Renewals: Poor claims experiences have a direct correlation to policyholder acquisition and renewals. Dissatisfied policyholders are more likely to explore alternative insurance options.
Failure to Adapt to Policyholder Communication Preferences: Traditional systems often fail to adapt to the preferred communication methods of policyholders. When a policyholder, accustomed to electronic communication, needs to file a claim, the lack of adaptation to their communication preference can lead to friction and dissatisfaction.

Efficiency drives the success and sustainability of insurance operations, making it crucial to overcome the challenges listed above.

Embracing Digital Transformation and Insurtech Solutions in the Claims Process

Digital transformation in the claims process and throughout the insurance industry involves a strategic and comprehensive approach to technology implementation.

With an average claims frequency of 8%, policyholders don't understand the claims process. Insurance professionals must ensure that the claims process is efficiently communicated and that transparency is present in every stage of the process, from first notice of loss through to claims completion. Claims professionals also must be educated on new technologies that are implemented throughout the process, especially if it affects their daily operations.

There are many ways that companies in the insurance industry can take steps toward digital transformation, including:

Understanding Your Workflow: Analyze and understand each part of your existing workflow, extending from the sales cycle through to claims completion.
Identifying Roadblocks: Recognize speed bumps and roadblocks in internal processes that impede efficiency, providing a road map for process improvements and digitization.
Taking a Holistic Approach: Seek comprehensive process improvements rather than quick fixes.
Allocating Resources: Recognize the importance of allocating the necessary resources, both financially and in manpower, to drive the adoption of new technologies.
Remaining Dedicated: Acknowledge that any transition relies on dedicating time, energy and resources.

Insurtech solutions offer accelerated processing times, improved accuracy, enhanced policyholder experiences and adaptability to industry trends.

This strategic shift not only optimizes internal workflows but also creates enriching experiences for today's policyholders. Automation facilitates complex coverage decisions while efficiently communicating with policyholders. Real-time updates accessible through a customer portal empower policyholders, offering transparency to keep them informed throughout the process.

Companies in the insurance industry can revolutionize their operations and remain competitive in an ever-evolving landscape, delivering unparalleled efficiency and value to internal processes and the overall policyholder experience.

Clay Rising

Clay Rising is the chief claims officer at Brush Claims.

Rising grew up in the insurance industry, working for his father in an independently owned agency throughout high school. He used that experience to gain degrees in risk management and insurance and corporate finance.

After quickly deciding that office life was not ideal, he left the corporate world to build houses for Habitat for Humanity full time. When the housing market turned, he relied on his past and education, coupled with his construction knowledge, and joined The Travelers as an adjuster. He later spent nine years at ASI (which became Progressive Home), where he held numerous leadership roles. He joined start-up Kin as their first VP of claims, where the team grew from one in 2020 to more than 135 today.