On May 21, Novarica facilitated our virtual Special Interest Group meeting focused on P/C claims. The session highlighted a variety of topics, from the impact of COVID-19 on claims departments to realizing operational efficiencies both from the human standpoint and with any tools and capabilities. Some of the primary takeaways are below:
COVID-19 and Its Effect on P/C Claims
Due to the consequences of COVID-19, formerly optional technology strategy projects have now become mandatory for survival, including digital claims payments, virtual claims inspections, and claims fraud analytics. In addition, the efficacy of predictive models used in claims, severity, loss estimation, and fraud prevention must be reevaluated in the context of the pandemic; these models could be incorrect due to their derivation from historical data that is no longer relevant.
Some carriers have fallen back to manual decisioning while they examine the rules and any contingencies in predictive models, but there has not been much of a problem with the workload as the claims volume has fallen as well.
Optimizing Work Capabilities
Teams have been using a variety of collaboration tools to facilitate a better sense of flow and to have better metrics/KPIs on team productivity while working from home. Some carriers have also put additional instrumentation into their claims systems to collect better metrics across claims, such as case adjustment time and customer satisfaction. Desktop analytics for claims programs allow organizations to better see adjuster productivity.
A tactical improvement has also been to more closely recreate the work environment at home—insurers have recognized that having dual screens is important and have worked to ship screens out to adjusters. In addition, more carriers are thinking about how to lock down printing abilities to limit exposure of sensitive information. Insurers have also used the pandemic as a time to focus on enhancing the capabilities and skill sets of their employees. For some organizations, this period has served as an opportunity to take a step back and examine both how their claims organizations and IT applications are performing.
Driving Efficiency and Automation
While there had been previous industry interest in virtual inspections, they have been brought to the forefront during this time. Auto and property inspections have enabled carriers to have “eyes on” new losses without a physical presence. Telemedicine for WC had been primarily used in remote areas, but the pandemic was a catalyst for widespread adoption. By cutting out travel time, adjusters are able to spend more time on claim investigation and assessment; while it is a COVID necessity, it is also an effective play at increasing operational efficiency and loss cost management.
In addition, one insurer shared increased customer receptiveness to two-way video between the customer and third parties, with up to a 10x increased acceptance of that tool. The success of the tool with claims has led to the spread of its usage into fraud and SIU as well. Some carriers also shared that they’re leveraging machine learning models to drive decisioning for simple claims and identify certain scenarios sooner, such as total loss payouts. In other cases, the use of machine learning models could automate tasks for claims adjusters or provide them with insights that allow them to settle a claim more effectively.
Navigating Change
Participants agreed that involving business team leaders and end users throughout the process for strategic projects helped drive excitement and better adoption of software and tools. Having champions of the software involved early so they can evaluate tools, provide feedback, and incorporate that feedback is important. This creates advocates and allows for more seamless change management. One carrier suggested the creation of a pilot group to create local excitement for new capabilities, saying, “On the analytics front, it’s hard to appreciate that data and analytics can identify something that maybe a human can or can’t. We think of it as assisting expertise, not replacing it.”
Novarica covered vendors active in this area in our Property/Casualty Claims Systems Market Navigator. We have also extensively covered challenges related to the pandemic in our virtual town halls and various blogs and articles found in our COVID-19 resource center. The next virtual P/C Claims Special Interest Group session will be on Thursday, August 13, at 1 pm ET. Please register and join the conversation.
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