Signs Your Claims Processes Need to change….FAST
For the past several years, the path to success for insurers has been plagued with obstacles and hazards – some obvious and others unseen. Ever changing policyholder and industry demands combined with increased regulatory oversight, fierce competition and an uncertain economic outlook have crippled many insurers. These pressures not only impact today’s business, they have changed the landscape of the market, speeding the rate at which insurers must respond to change in the future. Although no department within an insurer’s operation is safe, the claims area is most affected, running the risks of curbed operational metrics in the short term and underwhelmed policyholder satisfaction over the long haul.
Insurers have two choices: continue to coast with a “business as usual” mindset in claims processing, or grab this opportunity to embark on the path to modern digitisation. To start the process off right, turn your attention to content and process management solutions OnBase claims management is designed to optimise the claims process. Not only does this solution provide immediate benefits, such as lower costs and increased processing speed and visibility, it positions you well to successfully respond to future needs. But first, you must first acknowledge the warning signs that your claims processes do, in fact, need to improve through digitisation. Where does your business stand? Are your claims processes struggling? Are you keeping up with the race to stay competitive?
Slow Response Times
Why does it take so long to answer claimants’ and agents’ questions? Today’s consumers expect superior levels of customer service and if you are not giving it to them they will go somewhere to somebody who will. Customers regularly interact with companies that set the bar for exceptional customer experiences. This significantly raises their expectations for all services, even those offered by insurers, including: speed of response, ease of use, relevance of content and personalisation.
Your distribution channel has expectations, as well. They expect the claims process to run smoothly and that they’ll be involved from first notice of loss to the settlement. Yet, the more parties are involved in a process, the more complex it becomes, slowing the entire process down.
“…among claimants with low satisfaction (scores of 550 or lower), only 12 percent say they “definitely will” renew with the insurer that handled the claim, and 18 percent indicate that they have already switched insurers…”
– J.D. Power and Associates 2012 U.S. Property Claims Satisfaction StudySM
Obsessed with paper
The amount of information that is consumed/edited/captured/reviewed/authorised and stored within the Insurance process is greater than any other industry I have seen. Isn’t there a better way to manage all of this information? Claims processes depend greatly on agents, adjusters and claimants. The information they provide lives and leaves the claims life-cycle the same way it entered – as paper documents. And, even though insurers have control over their outbound communications, typically this, too, exists as paper documents.
Times are changing – and quickly.
According to a report issued by the analyst firm Strategy Meets Action, “63% of insurers say they will increase the digitisation of inbound paper documents over the next 3 years while 87% will increase the digitisation of outbound documents.”
Why do we have different workflow processes for every type of claim? Paper and inconsistent processes go hand-in-hand, reducing your ability to provide both the required disclosures in the claims process and the proper documentation of claims files. It also increases the risk of paying the wrong claim amount or incorrectly processing total loss claims. Manual processes heavily dependent on paper documents typically exist to substitute legacy systems. As such, they can never be fully optimised for speed or accuracy. Nor can they be standardised to reduce variances and leakage – information lost as it moves through process steps. Take a look at where the power of OnBase workflow can help overcome these bad habits.
“…claims resources – supervisors, staff and field adjusters – spend 44%-49% of their time on non-core activities…”
Multiple disconnected Systems
Why do you have to flick from system to system just to get the information you need? Information is an insurer’s greatest asset, without it you have no business – but it can also be among its biggest challenges. Without an integrated solution to connect them as new systems are acquired, or built to address specific needs, the information within them becomes trapped, siloed. The result is multiple, disparate systems – from underwriting workbenches to policy administration and claims management systems. OnBase customers have Integrated ECM into more than 500 unique applications without custom coding.
Consider taking the time to look at the entire claims side of the business. Is it time to re-think the flow inside the organisation, energise all of the interfaces, and re-tool to provide richer capabilities.
Why are our systems so hard to use? The infrastructure of Insurers has changed over the years in response to both business trends and ever-changing regulatory demands. System workarounds, complex interfaces and tools built by and for IT make it difficult for end users to manage the document based content involved in the claims process. As a result, there is a very heavy dependence on already overburdened IT resources. In many cases the skill set and knowledge employed to build the systems and interfaces leaves the business, and with it leaves you a neglected, vulnerable system that contains your businesses greatest asset…..Data.
Why can’t our staff/adjusters access information in the field? Armed with laptops, smartphones and mobile printers, field staff and claims adjusters are the front line soldiers. Despite all this technology and kit they frequently spend several hours completing necessary paperwork. To truly realise the benefits of mobile technology, field staff and adjusters must have access to the same resources they have in their offices to complete forms and verify data. Whether achieved via real-time connectivity or offline and synced with the corporate back-end system, such capabilities empower adjusters to complete more of the claims process on-site, eliminating time-consuming paperwork and ensuring real time updates to the claim to be made whilst remote. Why have the tools if they are not being used to their full capability. OnBase Mobile allows your remote workers to take the office with them. Access claim files, edit information, collect photos and work on the claim as if they were in the office.
“Moving to leverage mobile technologies is a necessity for insurers, but the urgency varies by size and line of business.”
-Mark Breading, Partner, Strategy Meets Action
Are we sure we are compliant? Insurance is one of the most regimented and regulated of industries. From the enforcement of internal company guidelines to Government legislation, the scope is vast. Paper-based claims processes expose your organisation to legal and financial risks – penalties from late claims close-out, for example, as well as prolonged discovery for appeals, audits and legal action.
Six of the Top 10 most common market conduct compliance criticisms for Property & Casualty insurance are related to Claims:
- Failure to properly acknowledge, investigate, pay or deny claims within specified time frames
- Failure to provide required disclosures in the claims process
- Improper documentation of claim files
- Failure to process total loss claims properly
- Failure to pay the appropriate claim amount
- Failure to respond to the regulator of insurance and/or produce records requested during the exam process
– Wolters Kluwer Financial Services, 2011
No second changes
Unlike other industries that manufacture and deliver a physical product, the perceived value of an insurance company is experiential, it’s a transaction and it needs to be of the highest quality every time. An insurance company is judged by its customers’ interactions with their agents and/or insurers, and how well that insurer or agent delivered on the insurance contract’s promise, get it wrong once and the consumer is unforgiving. If underwriting is where the promise begins, a claim is where that promise is delivered. Insurers are in a challenging business environment, one that demands operational efficiency to improve both profitability and customer service to remain competitive. It is essential to keep moving forward. But despite the warning signs that claims processes need improving, many insurers remain tethered to their legacy systems. Once at the forefront of technology, these systems are unable to keep pace today and leave insurers far behind competing companies with superior speed-to-market and service capabilities. Using new tools and technologies to expand their capabilities in managing insurance transactions, insurers are increasing the contribution the claims operation makes to the profit and service equation. Document and process management solutions help insurers fulfil their promises while driving real value, building trust and expanding relationships. Now is the perfect opportunity to modernise your claims processes. Doing so earns your company a place among the leaders in the insurance marketplace. What is the cost to your business of doing nothing ?
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