It's time. Time to expand both the thinking and actionconcerning claims. Time to take things beyond the transaction.

The transformation of claims operations is well underway in someinsurance organizations while it's just getting started in others.Progress and needs vary by company size and line of business. Butone thing is clear—there are real advantages to be gained with thenew possibilities that are now available.

Accurate and efficient processing of claims has been a criticalcomponent of the profit equation in the insurance industry sinceits inception. Early automation efforts primarily addressed theaccounting and reporting aspects of claims operations. As systemshave become more sophisticated, the emphasis is now more focused onhow the work getsdone.

Streamlining processes and improving efficiencies aim not onlyat reducing costs. Today, automated systems have the power totransform claims operations by taking business capabilities to thenext level—improving the quality of decisions, enhancing thecustomer experience, and integrating claims functions to create anenvironment for collaboration throughout the organization as wellas with third-party service providers and stakeholders.

A recently released SMA research report, ClaimsTransformation—Positioning for the Future—identifies theaccomplishments insurers have made and looks at where newinvestments are being directed. Insurers are making great progressand formulating significant plans to transform their operations forsuccess in the coming years. They are continuing to focus onefficiencies, but are taking a broader view of how to transformprocesses for real advantage in the marketplace.

Insurers are investing to equip their professionals with theinformation they need to make better decisions, automating tobetter satisfy customers during the claims experience and retaindesired clients, and spending to improve accuracy and reducecost.

For many, the greatest barrier to improving claims processes ishaving existing IT platforms that fall short of meeting theirbusiness needs—systems that are isolated and insulated and dependon scarce IT resource for all changes.

The key capabilities that insurers are looking for in their nextclaims administration systems include workflow, no or low-touchprocessing for routine claims processing, document management, andbusiness intelligence. Investments are being directed tocapabilities that make it easier to respond to new regulation, todrive efficiency via a paperless office, and to position for abetter response to catastrophic events.

Insurers are planning to invest in imaging technologies andautomated workflows to improve efficiency and foster integrationwith service providers and specialized servicing systems for areassuch as fraud and medical.

Keeping the pace in the claims space is a must for success inthe coming years. The claims area can make significantcontributions to transforming the overall business. Insurers needto examine their own operations in light of what is quicklybecomingstandard practice in the industry—capabilities that only ashort time ago were considered bleeding edge. If it isn't alreadyin the works, it is time to develop a thorough plan for claimstransformation—to expand both thinking and action beyond thetransaction.