While the recession has had a devastating effect on manyindustries, insurance professionals are successfully navigating thetough economy. This isn’t to say that they are immune to therecession’s influences, but it is a testament to their resilienceand ability to create leaner, more efficient ways of doingbusiness.

Many insurers have responded to challenges in the market byenhancing workflows to reduce cycle times, control operating costs,and improve policyholder satisfaction. Some have achieved greatsuccess by adopting new claims management solutions. However,scouring the market for the appropriate vendor and solution to fit a specific company’s business model is no trivial task; itrequires intense scrutiny and evaluation. To ease thedecision-making process, insurers should be aware of four criticalpoints so they can select the claims management solution that willproduce the best outcome for not only their organizations but alsothe people they serve.

Online Security

Media reports about high-profile cyber attacks and theproliferation of malicious computer viruses highlight the constantneed to safeguard data. Insurers are an especially attractivetarget to hackers because of the type of data they store aboutpolicyholders. Because an embarrassing security breach can exposepersonal data and damage customer relationships, online security isa top priority. An effective claims system can thwart cyber attacksthrough the use of secure encryption technology and otherprecautions to maintain the integrity of policyholder data. Suchmeasures also keep the claims system running virtually 24/7, evenin the event of a major catastrophe.

System Capacity

Claims volume and activity can easily double or triple in themonths following a major event. A reliable claims management systemwill scale to handle this increased load, and it will use dataredundancy and off-site backup systems—all in real time—so thatinsurers are prepared for just about any scenario. Any downtime ordiminished functionality can impede adjuster productivity as wellas aggravate policyholders who may be willing to talk about a badclaims experience with family, friends, and acquaintances onFacebook or Twitter.

Integration

Before settling on a claims solution, insurers should determinewhether it will integrate into their existing systems. Claimsmanagement technology alleviates this concern by seamlesslyintegrating with proprietary systems. For example, if an insurerhas a first notice of loss (FNOL) system for its call center, aneffective claims system will connect with it and automaticallyassign the claim to an adjuster once it has been captured.Technology also supports compatibility with the variety of fileformats used in the industry and can easily communicate with thecompany’s internal systems to both promote claims-handlingefficiency, and produce quantifiable results.

ROI

Ultimately, one of the most important criteria to consider iswhether a new claims solution will generate measureable,sustainable improvements. Technology affords many ways to reducecosts and speed claims toward final settlement. For instance,communication systems facilitate coordination between insurers,adjusters, service providers, and policyholders to keep allstakeholders updated about progress. Tracking capabilities alsomonitor claims to make sure they don’t stall in theprocess.

High-powered analytics use audit algorithms to help insurerskeep operating costs under control. To ensure accuracy, theseaudits inspect claims assignments for common errors, such asredundant repairs or missing estimate items. While someclaims assignments are underestimated, many claims contain errorsthat, when corrected, refine the total claims value and verify thatestimates appropriately match the type of work needed to repairdamaged structures.

Leading claims management technology also provides users withgraphical reports that track company performance for a number ofmetrics, such as response time for contacting policyholders,inspecting losses, and reporting findings, and then compare thosefigures against industry benchmarks. Users can then identifyopportunities for future training to improve performance and exceedcustomer expectations.

While the current market has its challenges, it affordsinsurance professionals the opportunity to improve and innovate.One effective way to achieve that end is to adopt viable managementsolutions that enhance the claims journey. For those insurerslooking to improve their claims management processes, theaforementioned criteria can serve as a valuable guideline to helpthem pick the solution that improves performance and ensureslong-term financial stability to make certain they will be aroundfor their policyholders for years to come.