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Every quarter when I look at the combined operating ratio results for the P&C claims industry, I see a constant problem: increasing loss adjustment expenses (LAE). 

To combat this trend, many insurance carriers have begun automating or outsourcing tasks like vehicle collision damage appraisals. As a  result we’re seeing an increase in the volume of these appraisals ”outsourced” to direct repair program (DRP) partners, likely in an effort to avoid pricey  insurance company or independent staff appraisals. The cost of a staff appraisal can be the most expensive collision repair appraisal channel, potentially more expensive than an independent appraisal — hence the shift.

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