Could the claims challenge current InsurTech priorities?
The insurance industry is witnessing many changes, driven by current technology trends such as Internet of Things, Big Data and Analytics, Blockchain, which are dynamically and irrevocably changing the way it works. Let’s look at the major trends impacting the industry and discuss the various challenges driving current InsurTech priorities and see if we can mention the biggest ones of all.
Every industry has its leaders and its laggards and the insurance industry is no exception to this. Deep pockets are helping some insurers harness digital technologies to change the way they work and to:
- Offer new models and customized products to meet changing customer expectations, driven by online retail models,
- Partner with technology players to ensure they keep up with emerging trends in technology and to leverage the Internet of Things to adopt sensors or connected devices to collect data for loss prevention and employ better pricing methods in property and casualty , life also as health insurance.
- Establish a cybersecurity strategy to protect the sensitive personal and business data they store and comply with privacy regulations.
- Embrace cloud computing, AI, and automation to improve speed and flexibility and resolve claims faster for better customer satisfaction.
- Use advanced analytics to gain insights and proactively plan for future business deals and gain competitive advantage.
- Consider using blockchain technology to add “smart” contracts and secure, decentralized data collection, processing, and dissemination to your processes.
Are these strategic initiatives enough to enable the companies that adopt them to enjoy industry and market leadership and, ultimately, success? What capabilities are needed for insurers to prepare to meet the demands of the industry, in channel expansion or business model development, as it evolves? How can insurers prepare for the demands of tomorrow even if they meet today’s expectations of them? The purpose of this post is to posit that many insurers fail to recognize the importance of claims management to their business, even as they are focusing on many of the other strategic imperatives they face. Let’s explain why we would say that.
It is an open secret that customers are always happy with a good claims settlement experience, but they tend to get very angry and start posting strong negative comments online when their claim is delayed, disputed or denied. While claims satisfaction is an extremely critical component of an insurer’s overall customer relationship management challenge, it’s just a work in progress for most right now. Instead, they should pay attention to customers and also focus inward, while delving into the reasons for a customer’s dissatisfaction:
- Insurers need to pay close attention to customer feedback and levels of satisfaction with their claims submission process and settlement experience, especially when they are rejected.
- Insurers need to capture customer feedback and factor it into the way their processes work and question the clarity of their own sales pitch, and see if the claim was fairly rejected.
- They should pay close attention to their reputation in this key area of customer satisfaction, which could affect their ability to retain a customer.
- It must be remembered that dissatisfied customers never come back for additional coverage or another policy.
- Even agents who find too many customers speaking out against an insurer’s claims settlement process tend to drive them out of business.
- The seamlessness of the customer experience should extend to claims management as claims processing becomes a seamless process.
- Insurers can use technology to provide more options for filing a claim, including uploading photos and videos, with increased speed and accuracy and reduced human touchpoints.
- As algorithms more easily detect fraudulent claims, claims handling becomes more efficient. Data-driven claims prevention can help reduce costs and deliver value by predicting actual risk and lowering premiums.
By managing the delicate balancing act between identifying fraudulent claims and paying legitimate ones, insurers could create a negative relationship with a customer by being too strict or too suspicious. But that doesn’t mean they can trust and continue to leniently approve every claim. Any injustice, whether real or perceived, could determine whether a policy is renewed again, our online reputation suffers, or the insurer could face a legal dispute in court. Although insurers work hard to identify the technologies needed to expand their distribution channels and ensure they create an optimized customer journey; They can’t lose sight of the importance of removing fraudulent claims from their priority list. This is why we believe claims management could challenge InsurTech priorities for the insurance industry. What do you think? Please write and share your thoughts.