Help Yourself

Service Spectrum

Customer self-service in claims falls into two main types of activities: one, reporting the claim; and two, getting information, whether its obtaining historical claim detail or keeping informed about whats going on with in-process claims. In offering any activity via the Web, carriers target a common objective: reduced cost.

You have customers calling up and asking CSRs questions to which the carriers already have the answers they could deploy proactively online, says Tim Carpenter, senior analyst at Watchfire GomezPro. Instead of paying someone $18 an hour to handle a 25-minute phone call, carriers could move those inquiries to the Web, and customers never would be put on hold.

Electric Insurance, Beverly, Mass., saw the cost-reducing potential of online claims reporting as a driver for the development of its self-service portal. If customers are willing to complete the transaction on their own, it doesnt require we staff a call center. Its a one-time cost to build the function, but the [amount] we save hopefully is greater than that cost, says Steven Baer, the carriers manager of e-business operations.
Carpenter also identifies other potential benefits to carriers, such as reducing errors and third-party fraud by making claim information available to policyholders throughout the entire handling process. Humana, Louisville, Ky., sees supplying Web access to claim information as having far-reaching benefits to customers, as well.

The health insurers MyHumana customer portal furnishes both detail and summary information on a plan members insurance claims. Members can run anticipated healthcare services through their current plans to better schedule procedures and manage out-of-pocket costs. The portal also offers a financial calculator, developed by Hu-mana, which lets members run their incurred claims through other available health plans to run what-if scenarios and help them make future plan choices.

Humana believes letting customers access and use its claim information is important to the future of consumer-directed healthcare. The big-gest challenge [to consumer-directed plans] is empowering members to understand benefits and helping them choose and use plans effectively, says Jim Cannan, IT director for call center auto-mation, online enrollment, and billing at Humana. Its important we get information out to the [plan] members.

Yet despite the potential benefits of claims self-service to both carriers and customers, many insurers havent put claims portals at the top of the to-do list. Most of the questions coming in [to a call center] involve billing and policy questions, with only about 30 percent involving claims. Its not that carriers dont want to do [a claims portal], but they deal with the others first, says Larry Fortin, vice president of the insurance practice at Edgewater Technology, a consulting firm specializing in insurance service portal development.

Claims Reporting

P&C is where most, if not all, customer-claims-reporting applications can be found, and reporting among P&C carriers actually is offered more commonly than claims inquiry. However, theres a caveat: Web reports often are static formselectronic versions of paper-based FNOL forms that dont connect to back-office systems either to prefill coverage data or load customer-entered data into the claims system. Part of the reason for this is technologicalthe oft-cited difficulties carriers face in dealing with multiple, disparate legacy claims systems that hold coverage and claims data.

However, the disconnect sometimes is very intentional, a way for carriers to mitigate risks of bad data by having people more versed in insurance than customers control the data thats entered into claims systems. Should you assume data being collected at Web sites is valid, or do you need a checkpoint in between to look at that data to make sure its clean before you put it in the back-office claims system? asks Kimberly Harris, vice president of research at Gartner. A customer may not understand the terminology or what the question is asking.

Personal auto insurance carrier Esurance, San Francisco, a division of White Mountains Insurance Group, Ltd., be-lieves it was important to prepopulate its online claims reporting forms with policy data both to ensure accuracy and encourage customer use. When we do our development, we try to view it from the customers perspective and eliminate work [for them] when we can, explains Chris Henn, managing director of insurance operations at Esurance. We provide customers policy forms online, and their payments are electronic. We like to maintain a paperless approach with customers throughout our relationship with them.

As an Internet-only company, Esur-ance saw Web claims reporting as a natural fit. We market to tech-savvy customerspeople who want to do everything online, says Kristin Brewe, communications director at Esurance.

Once a customer submits the claim, the Esurance system, which was developed in-house, sends an e-mail-based notification to the carriers centralized loss-reporting unit in Sioux Falls, S.D., where it is entered manually and handled like all other claims the company receives. Having the Web-based FNOL populate the insurers own claims system and kick off claim assignments will be part of the carriers project in 2005 to integrate its file-handling system from JW Software with its internally developed policy administration system.

Electric Insurance, a carrier in Watch-fires insurance Web site benchmark group, first rolled out its claims application in December 2002 for auto and homeowners. Web-reported claims automatically are routed to loss adjusters whose responsibility it is to contact claimants to begin the claims process. Insureds with auto glass claims are redirected to a co-branded site between Electric and TeleGlass National, a third-party service the carrier uses to administrate those claims and perform glass repairs.

Throughout the claims process, policyholders can log on to view status details. Electrics self-service applications are dependent on policy and claims data from legacy mainframe systems, with the insurer currently using a screen-scraping application to fill fields on the portal display.

Electric did face a legacy system challenge when it discovered in 2004 its mainframe claims application wasnt available at all times the Web application was. We found at certain times of the day, because the Web is 24/7 and our back-end systems were not, there were some connectivity gaps, says Baer.

Electric didnt want to suspend the Web function each day during mainframe downtimes. We try to make [the Web] a pleasant experience for our customers and make it a seamless process and not have to post messages saying, This wont be available for a half hour, Baer says. More than 50 percent of customers who have any problem [with a Web site] simply will call the next timethey wont even try the Web site again. So, we really want to focus on making that customer experience work.

Therefore, Electric temporarily pulled the claims-reporting service, except for glass claims, while it developed solutions to the problem. This likely will include restructuring the way it handles batch and real-time processing and building in fail-safe mechanisms to initiate a follow-up on any claims customers initiate on the Web but do not complete.

Since [the claims-reporting process] happens behind the log-in, we already have a lot of information about customers at that point. We know who they are, their e-mail, and phone number. We could make call-outs to customers, or we could send automated e-mail requests to them on incomplete or abandoned claim reports, Baer says, just as some online retailers follow up on abandoned shopping carts. The company plans to have its full claims-reporting suite relaunched by press time.

Legacy systems also were a challenge for Humana, which has five different claims-administration platforms. Some members have claims processed on several systems, Cannan explains. We [needed to] give them one common view. To accomplish that, Humana developed a consolidated customer database. It uses ETL tools to load the database from the claims systems, which are updated on a daily basis.

Pushback

In addition to overcoming technological challenges, insurers delivering claims self-service applications face the obstacle of convincing customers to go online, rather than pick up the phone. In the high-touch world of claims handling, its a difficult task. In fact, among the P&C companies included in this story, none reported percentages higher than the single digits for loss reporting.

Not all consumers want to enter claims online, says Harris. Its a change in behavior, particularly depending upon socioeconomic status, age, and so on. You cant expect everyones going to use it and that its going to happen quickly.
Building out an online experience is tougher [for an insurer] than for a bank or investment firm, Carpenter maintains. An investor logs on a couple times a week to check account information. With insurance customers, its only a couple times a year, and its for specific information. The extent to which you can give them a positive experience is a big deal in the [insurance] industry. If you can do that, the next time they have an inquiry theyll feel more comfortable about logging in.

In short, carriers have to answer the question, Whats in it for me? from policyholders. In the application process, insurers can lure customers to the Web with low premiums, and in the payment process, they can offer the convenience of online payment vs. the hassle of writing and mailing checks. But when it comes to claims, getting customers to enter their own loss information is an activity people view as a benefit to the carrier, rather than the customer.

Even Web-only companies, such as Esurance, struggle with that issue. When I audit our CSRs and listen to claim calls, I am impressed customers want to build a dialogue with the CSRs, says Michael Luders, claims manager at Esurance. Its more than just collecting information about the accident; its the CSR asking [customers] whether theyre OK. The Web simply cant replicate that.

Additionally, many carriers have another constituency with a stake in the claims process: agents. Particularly from independent agents, carriers risk getting pushback in moving claims reporting and information into the hands of the policyholder.

Quite frankly, part of the problem lies with the carriers. They havent learned from other [financial services] industries, by involving the broker, says Carpenter. [Insurers] need to integrate [agents] into the online experience. They need to let agents be aware of when clients log on [and provide] simple on-site instant messaging, so when you report a claim online, theres a message that says, This also is going to your agent. That will reinforce there is value to the agent.

If carriers do this, selling agents on the potential of Web claims service to reduce their own administrative overhead should be a much easier task. Agents are OK with removing touch points as long as they are replaced with more valuable ones, Carpenter adds.

Risky Business

Deploying a claims portal that doesnt live up to its usage expectation carries a cost in development dollars spent. However, there are other risks to consider, as well, the biggest of which is an adverse impact on customer relationships. Carriers need to determine either that service provided through or initiated by the Web channel is as good as supplied through traditional channels or that other technologies are better suited to customer self-service.

For example, Progressive, Cleveland, Ohio, another company on Watchfires benchmark list, offers all its customers access to three years worth of claim information online for open and closed claims at a password-protected Web site. According to Vikki Nowak, business systems consulting manager for Progressive, customers can view basic claim information, find the dates and amounts of payments made, see whether those payments are full or partial, and retrieve repair estimates.

But when it comes to providing detailed status on in-process repairs, Progressive believes other technologies have advantages over the Web. When customers use Progressives claim service centers (vs. handling repair arrangements themselves), those customers are given a pager at the outset of the claim. Progressive uses an internally developed Web-based scheduling and workload management system, called WebTracker, which allows claims representatives to schedule repairs and, using bar-coding technology, keep track of the location of vehicles and repair progress. Progressive then issues progress updates to customers via those pagers.

Since customers arent always at a computer but can carry a pager, Progres-sives strategy enables the carrier to deliver repair status most effectively and customers to pick up repaired vehicles more quickly. This in turn speeds the overall claims process while cutting vehicle storage and other costs.

Progressive also currently is piloting an online glass-claims-reporting application in Virginia and Texas and has been pleased with the response of customers who have used the service so far. However, with a reputation built on end-to-end claims service, the company is taking a cautious approach to extending loss reporting to other coverages.

While we are committed to providing customers with technology that helps them save time and effort and offers options for how they access their policy, we also want to strike a balance with [delivering] the human touch through a claims representative in person or over the phone, Nowak explains. So, we continue to evaluate online reporting and look closely at how our customers accept it.

Mitigating Risks

Making Web-based self-service successful means making it an easy, pleasant experience for customers. This is something the industry has struggled with. Customers dont understand the process and dont understand the terminology. We havent implemented tools to improve that experience, Harris contends.

Customers sometimes are left feeling a carriers Web portal is a black hole where questions go in but no answers come out. When a claim is reported, where does it go, how fast does it go to someone to get an answer or response, and how can a customer be sure someones on it? Also, if customers are online filling in information and they have questions, how do they contact the company to get answers? Harris asks, adding shared screens between the customer and call center are a must.

Humana is keenly aware of the need to make the online experience a positive one for customers. First, when plan members are online and have a non-
urgent question, they can send an e-mail to service staff. Because of HIPAA privacy issues, all e-mails are sent from and to a members mailbox behind the log-in on Humanas secure site.

When a member needs a question answered in real time and calls in, Humanas consolidated customer database ensures both the member and call center have access to the same claim information. When members call with a question specifically related to the portal itself, those calls currently are directed to Web specialists who have a screen emulation program that allows them to see what the member has done on the site. Humana is in the process of rolling out this program to all call center reps.

Finally, Humana currently is piloting a call me feature at a separate Web portal that is provided to the other part of its customer base: employers and other group plan providers. This puts those customers in touch with a Humana service rep without having to initiate a call and enter information into the IVR system theyve already keyed on the Web site. In early 2005, Humana plans to include this feature on the MyHumana site for plan members, as well.

Despite the business and technology issues that challenge insurers looking to deploy Web-based claims self-service applications, the industry will keep movingalbeit cautiouslytoward their development, motivated by the desire to cut costs, peer pressure, and the inexorable drive toward greater claims automation. If you set up a self-service Web site correctly, youre capturing data at the source, Fortin, from Edgewater Technology, says. It really sets you up for automated claims processing.

Percentage of carriers that offer the following services
at their customer service Web sites*

P&C Life/Health
Policy changes or additions 24% 15%
Bill presentment 53% 15%
Bill payment 59% 31%
Simple changes, like address 29% 54%
Claims status check 29% 31%
Claims submission 53% 62%
View policy details 53% 62%
E-mail agent or insurer 82% 92%

*Based on those insurers that have a customer service site.

TECH GUIDE: CLAIMS AND FRAUD TOOLS

@Global
Breckenridge, Colo., 970-453-6477
www.atglobal.com

Accenture
Murray Hill, N.J., 866-869-8484
www.accenture.com/insurance

Adjustable Software
Markham, Ont., Canada, 905-415-0664
www.adjustablesoftware.com

ADP Claims Services Group
Elk Grove Village, Ill., 847-718-3381
www.adpclaims.com

AGO Insurance Software, Inc.
Mt. Arlington, N.J., 973-770-3200
www.agois.com

Allegient Systems
Wilton, Conn., 203-761-1289
www.allegientsystems.com

Allegis Communications, Inc.
Seattle, Wash., 800-566-6112
www.allegisteam.com

American Management Systems
Fairfax, Va., 800-255-8888
www.ams.com

Apex Data Systems
Tucson, Ariz., 520-298-1991
www.apexdatasystems.com

Attus Technologies, Inc.
Charlotte, N.C., 704-752-6249
www.attustech.com

The Bluebook International
Lake Forest, Calif., 888-425-8326
www.bluebook.net

Bramerhill Technology Group
Norcross, Ga., 770-368-3255
www.bramerhill.com

Bridium
Atlanta, Ga., 920-451-9777
www.bridium.com

Brightwork, Inc.
Chicago, Ill., 773-529-1100
www.brightworkinc.com

Burkitt Computer Corp.
North York, Ont., Canada, 416-642-6159
www.bccorp.com

Business Software Solutions
Mt. Laurel, N.J., 856-866-5601
www.bssnj.com

Castek
Toronto, Ont., Canada, 416-777-2550
www.castek.com

CCC Information Services
Chicago, Ill., 800-621-8070
www.cccis.com

CGI
Montreal, Quebec, Canada
514-841-3200
www.cgi.com

ChoicePoint
Alpharetta, Ga., 800-342-5339
www.choicepoint.net

ClaimIQ
San Francisco, Calif., 415-498-2415
www.claimiq.com

Clear Technology, Inc.
Westminster, Colo., 303-583-4150
www.clear-technology.com

Covansys
Farmington Hills, Mich., 913-469-8700
www.covansys.com

CSC Financial Services Group
Austin, Tex., 512-275-5000
www.csc-fs.com

CS STARS
Amarillo, Tex., 800-858-4351
www.starsinfo.com

Cunningham Lindsey
Lewisville, Tex., 214-488-5139
www.cunninghamlindsey.com

Decision Research, Corp.
Honolulu, Hawaii, 808-949-8316
www.decisionresearch.com

Delphi Technology
Boston, Mass., 617-259-1200
www.delphi-tech.com

Docucorp International
Dallas, Tex., 800-735-6620
www.docucorp.com

DWL
Toronto, Ont., Canada, 416-364-2045
www.dwl.com

EasyLink Services Corp.
Piscataway, N.J., 732-652-3589
www.easylink.com

Ebix, Inc.
Atlanta, Ga., 678-201-2023
www.ebix.com

E-Claim.com
Gretna, La., 504-433-9599
www.e-claim.com

EigenSoft
Portsmouth, N.H., 603-430-8032
www.eigensoft.com

Fair Isaac & Co.
Irvine, Calif., 949-655-3300
www.fairisaac.com

FARA
Mandeville, La., 800-259-8388
www.fara.com

FileNet
Costa Mesa, Calif., 714-327-3400
www.filenet.com

FINEOS
South Portland, Maine, 207-879-0400
www.fineos.com

First Notice Systems
Boston, Mass., 800-310-4367
www.firstnotice.com

Fiserv
Brookfield, Wis., 900-322-4220
www.fiserv.com

FLIR Systems
North Billerica, Mass., 978-901-8206
www.flirthermography.com

Fuego, Inc.
Plano, Tex., 972-801-4218
www.fuego.com

GAB Robins
Parsippany, N.J., 973-993-3400
www.gabrobinsna.com

Genelco Software Solutions
St. Louis, Mo., 800-983-8114
www.genelco.com

GenSource Corporation
Valencia, Calif., 661-294-1300
www.gensourcecorp.com

Group 1 Software
Lanham, Md., 301-918-6381
www.g1.com

Guidewire Software
San Mateo, Calif., 650-357-9100
www.guidewire.com

Hawkins Research
Murray, Ky., 800-736-1246
www.powerclaim.com

Hyland Software, Inc.
Westlake, Ohio, 919-462-8505
www.onbase.com

IDMI
Altamonte Springs, Fla., 407-389-0963
www.idminc.com

ILOG, Inc.
Mountain View, Calif., 650-567-8000
www.ilog.com

Infinity Systems Consulting, Inc.
New York, N.Y., 212-541-7602
www.infinity-consulting.com

INFOEL USA, Inc.
Aubrey, Tex., 940-300-4623
www.infoelusa.com

Infoglide Software
Austin, Tex., 214-357-4636
www.infoglide.com

Information Builders
New York, N.Y., 212-736-4433
www.informationbuilders.com

Injury Sciences
San Antonio, Tex., 877-979-7378
www.injurysciences.com

The Innovation Group
Danbury, Conn., 203-743-6000
www.tigplc.com

Insurance Data Processing
Wyncote, Pa., 800-523-6745
www.idpnet.com

Insurance Services Office
Jersey City, N.J., 800-888-4476
www.iso.com

Insurance Solutions &
Technology Inc.
Cayce, S.C., 803-796-1112
www.the-ist.com

InsureWorx
Emeryville, Calif., 510-596-1300
www.insureworx.com

ISCS
San Jose, Calif., 888-901-4727
www.iscs.com

JCRS Inland Marine Solutions
Oakland, Calif., 510-444-4811
www.jcrs.com

Jury Verdict Research
Horsham, Pa., 215-784-0860
www.juryverdictresearch.com

JW Software, Inc.
St. Louis, Mo., 314-843-5950
www.jwsoftware.com

Magnify
Chicago, Ill., 312-214-1420
www.magnify.com

Management Data, Inc.
Birmingham, Ala., 205-991-7511
www.mgtdata.com

Marshall & Swift/Boeckh
New Berlin, Wis., 800-285-1288
www.msbinfo.com

Marsh/STARS
Chicago, Ill., 312-627-6000
www.starsinfo.com

Metropolitan Reporting Bureau
Philadelphia, Pa., 800-245-6686
www.metroreporting.com

MFX
Parsippany, N.J., 866-639-6399
www.mfxfairfax.com

Mitchell International
San Diego, Calif., 800-854-7030
www.mitchell.com

Mitratech
Los Angeles, Calif., 323-900-1700
www.mitratech.com

MountainView Software
Layton, Utah, 888-533-1122
www.claimzone.com

Neap Analytics
Westerville, Ohio, 614-523-1067
www.neapanalytics.com

nsite solutions
Urbandale, Iowa, 888-282-6596
www.nsitesolutions.net

onClick Corp.
Houston, Tex., 713-784-7600
www.pnclickbiometrics.com

OpenFlex
Los Angeles, Calif., 213-252-2360
www.openflex.com

PCMS
Dallas, Tex., 972-855-3515
www.pcms.info

PDA Software Services
Overland Park, Kan., 913-469-8700
www.pdainc.com

ProcessClaims
Manhattan Beach, Calif., 310-937-4040
www.processclaims.com

QualCorp
Valencia, Calif., 888-367-6775
www.qualcorp.com

Quest Claims Services
St. Johns, Mich., 800-541-2593
www.questsoftware.com

Rebus Systems
Secaucus, N.J., 401-247-4925
www.rebusgroup.com

ReClaim Technologies
Newark, Ohio, 740-344-6956
www.reclaimtech.com

Recognition Research
Blacksburg, Va., 540-961-6500
www.rrinc.com

Results International Systems
Dublin, Ohio, 800-875-2126
www.resultscorp.com

RGL
Englewood, Colo., 303-721-8898
www.rgl.com

Riskclick
New York, N.Y., 877-747-5254
www.riskclick.com

Risk Sciences Group, Inc.
Schaumburg, Ill., 800-619-0224
www.risksciencesgroup.com
Robert E. Nolan Co.
Dallas, Tex., 972-248-3727
www.renolan.com

SAP America
Newtown Square, Pa., 888-727-8591
www.sap.com

SceneAccess
Pittsford, N.Y., 585-387-9883
www.sceneaccess.net

SeaTech Consulting Group, Inc.
Torrance, Calif., 310-328-8119
www.seatech.com

Simsol Software
Orlando, Fla., 800-447-4676
www.simsol.com

Sirius Financial Systems, Inc.
Englewood, Colo., 303-209-5914
www.sirius-inc.com

Stargate Solutions Group
Indianapolis, Ind., 317-469-7512
www.stargatesolutions.com

StarTech Software Systems
Novi, Mich., 248-344-2266
www.startechsoftware.com

SunGard Sherwood Systems
Armonk, N.Y., 803-419-4882
www.sungard.com

Synergy 2000
Pasadena, Calif., 626-792-8600
www.synergy2000.com

TEKclaims
Cincinnati, Ohio, 513-821-7844
www.tekclaims.com

Teradata
Dayton, Ohio, 860-537-9055
www.teradata.com

Tropics Software
Technologies, Inc.
Sarasota, Fla., 941-955-1234
www.gotropics.com

Trumbull
Windsor, Conn., 877-285-2174
www.trumbull-services.com

Valley Oak Systems
Alamo, Calif., 925-552-1650
www.valleyoak.com

Verity, Inc.
Sunnyvale, Calif., 408-541-1500
www.verity.com

Visibillity, Inc.
Chicago, Ill., 888-484-7424
www.visibillity.com

VS Visual Statement Inc.
Kamloops, B.C., Canada, 888-828-0383
www.visualstatement.com

WildCard Systems
Sunrise, Fla., 954-851-0700
www.wildcardsystems.com

Worldwide Testing and
Security Services
Clifton Park, N.Y., 518-371-8327
www.worldwidetest.com

Xactware
Orem, Utah, 800-424-9228
www.xactware.com

XDimensional Technologies
Brea, Calif., 800-789-2567
www.xdimensional.com