Web-based Systems are the Next Evolution in Claims Technology
Steve Discher | March 12, 2014
Claims technology in the Property & Casualty insurance industry has significantly changed over the last 20 years and continues to evolve rapidly. Companies with significant investment in existing claims systems may find it too costly to keep up with important technological advancements, which will adversely affect their ability to compete in an increasingly competitive technological and customer service–driven business environment.
The key is to establish a long-term claims technology strategy, one that’s shaped by review of current systems, processes, and staffing in order to address present and future needs.
The next phase of the claims system evolution will focus on enhanced web-based systems, elimination of manual “system workarounds,” and flexible third-party integrations to improve productivity, such as mobile-based, integrated field-damage estimating. The emphasis will include claim metrics, predictive analytics, data mining, and integrated recorded statement-taking. As social networking expands its footprint, companies will find it increasingly challenging to manage viral reputation damage resulting from poor claim handling.
The addition of mobile technology will improve productivity, enhance customer service, and improve a company’s competitiveness. New systems will need to be tailored for user-friendly navigation and processing, fully integrated with email clients, and readied for the next wave of technological advancements, including cloud technology, integrated video conferencing, and voice recognition. This type of rapid change requires claims systems to be more versatile and adaptable to new technology; the alternative is an entire system replacement.
Claim technology has undergone three broad transitions. Twenty years ago, the environment was paper-intensive (the manual phase), after which the typical P&C claim operation migrated to a combination of paper and automated processes (the automated phase). Today, paperless claim files (the electronic phase) are the norm.
As an industry, we have come a long way with claims technology; however, future advancements will need to focus on process improvements that yield cost savings that lower loss and expense ratios, and systems must be adaptive to rapid change.
Insurance companies have spent a lot of time and expense implementing state-of-the-art claims systems with advanced features and benefits. The question posed by many executives is whether the system features and benefits have streamlined operations, improved productivity, and reduced costs.
For example, can an adjuster who handles claims electronically handle more claims than the adjuster who handled claims manually many years ago? Have claim workloads changed with improved technology? Has the quality of claim handling improved with technological advancements such as electronic notes, automated diary management, and integrated document management?
The claim handler’s job has changed so much in the electronic environment that it is difficult to compare the past with the present. Employees who lack advanced technology skills or are unwilling to change will not be successful in a rapidly changing environment. Workloads have not changed significantly at the adjuster level; however, processing methodologies and technology have changed rapidly, improving efficiency and productivity. Staff adaptability to electronic work environments will be critically important to achieve costs savings through improved technology.
Although it’s true that staffing reductions have been a major technology-driven cost reduction, more important is that new technology has improved the quality of claim handling through predictive analytics, data mining, and metrics-driven reporting, which positively affects loss and expense costs.
With technology changing continually, now is the time to establish a long-term claims technology plan. Start by reviewing your current systems, processes, and staffing to size up the potential. A claims operational analysis, whether internally led or with outside assistance is well worth the effort and investment. It will help to identify process improvements and technology enhancements that will boost your bottom line. And equally important from a management perspective, it will prepare you to manage effectively in an environment of rapid evolution.
Steve Discher is executive vice president at The Nolan Company, a management consulting firm specializing in the insurance industry. For 40 years, The Nolan Company has helped insurance companies achieve measurable improvements in service, quality, productivity, and costs through process innovation and effective use of technology. Discher can be reached at firstname.lastname@example.org,
- Enterprise Architecture in an Agile World
- Top 10 Tips for Securing Your Mobile Devices and Sensitive Client Data
- Industry Insight: 4 Global Insurance Trends in Digital, Data, Content Services and Security
- Diving Deeper into Prioritizing Your Strategic Digital investments
- Why Content Rules
- How Mass Personalization Will Open the Small Business Benefits Market
- At Year End 2017, Will Your Organization Be Protected from Cyber Risks?
- Do Insurance Bots Dream of Mitigating Risk?
- Conditioned to Respond
- Managing & Mobilizing Insurance Data in a Connected World
- Race to the Finish Line
- New Tools, New Opportunities in Claims
- ITA LIVE: Reaching Insurance Industry Crossroads
- Advice to Insurance IT Leaders: Keep Your Eye on the Ball
- New Date, Venue for ITA LIVE 2017
- Guidewire Makes Major Push to Small and Midtier Market by Acquiring ISCS
- Insurance Disruption is Happening Right Now
- Insurity Adds Strategic Investment Partner, General Atlantic
- Beyond Transformation: The Convergence of Finance, Risk, and Actuarial Functions
- The Rapid Evolution of Consumer Protection Regulation
- Talent Hunt: Finding, Attracting, Retaining Top People
- Insurers Flexing Their Distribution Models
- Technology Driving Disruption in Insurance
- Fear of ‘Next Bubble’ Challenges Life, Annuity Carriers
- Technology Allows Commercial Lines Insurers to Stand Out
- Single Sign-on Viewed as Biggest Tech Challenge for Agencies
- ISCS Observes 20th Anniversary; Scurto Predicts Major Changes Ahead
- Policyholders and Their First Impressions
- Progressive Making Progress on the UBI Front
- High and Dry: Insurers Search for Disaster Recovery Plans
- Insurers Sign The (Un)Dotted Line
- Reflections of a Retired Insurance CIO
- Mobile Device Management Just One Answer to BYOD Issue
- Lessons from GEICO and Progressive on Winning the Critical Buying Stage
- You Are a Target for a Cyber Attack
- Web-based Systems are the Next Evolution in Claims Technology
- Gaining a “Wow” Experience from Web Users
- Time to Shift from Business/IT Alignment to Business/IT Alliance
- Healthcare Insurers Changing to Consumer Model
- Organization is the Key for Selecting Software Vendors
- Analysts Expound on the Needs of the Mid-tier Insurance Market
- Finding the Cure for Obamacare’s Website
- New Software Solutions Benefit Insurers on the Inside and Outside
- Products, Market Impede Investment in Systems for Life Insurers
- Combatting Cyber Threats: Predict, Prevent, Persist
- The Future of Telematics Heads Beyond Insurance
- The Shame in Cyber Security Lapses
- Building Policy Administration Systems for the Future
- Insurers Look Into The Eyes of Their Policyholders
- It’s a New Dawn for the ITA
INSURANCE IT NEWS
- Tower Selects EIS Group’s Insurance Platform to Drive Transformation
- NTUC Income Selects Majesco Distribution Management and Majesco Digital Solutions to Advance its Distribution Management Operation
- Emerson Reid Modernizes Its Business Processes With VUE Software
- Octo Telematics Powers CAA MyPace™ Pay-As-You-Go Program
- Announcing the Solartis Insure Microservice Hackathon
- DataCubes Completes Plug and Play Tech Accelerator Program
- Medical Mutual of Ohio Implements One Inc Digital Payments
- SUNZ Insurance in Production with Sapiens’ Workers’ Compensation CompSuite® Policy System
The Email Chat is a regular feature of the ITA Pro magazine and website. We send a series of questions to an insurance IT leader in search of thought-provoking responses on important issues facing the insurance industry.
ITA is pleased to present the 2014 Webinar Series. We have many topics for you to choose from and attendance is open to all ITA members. The webinar topics are current and exciting — ranging from predictive analytics to telematics and will focus on the direction insurance carriers need to follow for the future. All webinars are presented by insurance IT professionals along with some of the leading analysts and consultants in the field. There is no cost to attend an ITA webinar. For more information and to register for the webinar, click the “title” of the webinar below.
BLOGS AND COLUMNS
It has become a common refrain over the past few years to view the practice of enterprise architecture (EA) as something that time has passed by, much... READ MORE
One important trend in society over the past decade is our increasing ability to create and consume a seemingly unlimited amount of digital content... READ MORE
You have surely heard it said that small businesses are the growth engine for America. Today, the phrase has a special ring to it for benefits... READ MORE
With stagnant growth and lingering low interest rates, the life insurance industry faces a challenging future... READ MORE
Finding insurance carriers willing to write commercial lines risks has always been a challenge for producers... READ MORE
As Guidewire Software prepares for the start of Connections, its 11th annual user conference that begins on Nov. 2, Brian Desmond, chief marketing... READ MORE
Fraud detection has always been and will continue to be a critical component of claims management. Learning the lessons from current claims Straight... READ MORE
- Vendor Views