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Self-service tools have exploded during the last year along with a desire to do things remotely. Communication tools with insureds have been highly leveraged in order to facilitate multimodal communication channels, which is a fancy way of saying we can talk, text, email, zoom or chatbot with a policyholder. (Credit: Pixel-Shot/Adobe Stock) Self-service tools have exploded during the last year, along with a desire to do things remotely. Communication tools with insureds have been highly leveraged in order to facilitate multimodal communication channels, which is a fancy way of saying we can talk, text, email, zoom or chatbot with a policyholder. (Credit: Pixel-Shot/Adobe Stock)

As it exists today, when a policyholder experiences a claim, they are immediately signed up to manage a 16-step claim process that they never knew existed the day before. On top of the emotional and financial toll that an insurance claim can create, a significant amount of time and mental energy now have to be invested in order to manage the claim through resolution.

For insurers, they are facing a competing set of challenges. For some, they have seen their loss ratios tick up to 95-120%. This is unsustainable, and so immediate steps need to be taken to bring either their underwriting practices and/or their claims handling processes back to a profitable level. This tension with loss ratio also causes significant price pressure, which doesn’t allow these carriers to be as competitive in the market, and so they can quickly lose money through both claims adjudication and lower retention rates. Those carriers that are more successful in optimizing their total insured loss costs are better able to artfully apply their leverage to the underwriting side and grab chunks of market share that they like.

 

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