Can technology ever replace the claim adjuster?
That question is one of many addressed in TowerGroup's newest report on technology in the property/casualty industry, entitled, "Technology Direction in U.S. P&C Insurance Claim Operations: Transforming a People Business."
The report, written by TowerGroup's senior analyst of insurance practices Karen Pauli, makes the case that those in charge of claim departments are starting to pull away from the thought that policy interpretation and management can only be accomplished via an experienced claim adjuster. But don't look for adjusters to walk slowly off into the horizon just yet; Pauli says that a balance should be reached between technology adoption and claimant interaction that will satisfy customer service expectations and, in turn, create a competitive advantage for companies.
Most notably, Pauli says that technology that helps adjusters make policy decisions will offer the biggest return on investment. Incorporating predictive analytics — that seemingly magical technology that can analyze past claim patterns in order to expose trends and detect fraud — will help adjusters make better decisions on claims. This approach is preferred over the idea of simply automating all of the processes involved in handling a claim.
The report also states that technology must be embraced because of the thinning pool of qualified and experienced adjusters that can be expected over the next 10 years, due in part to the retirement of Baby Boomers. With the right technology, such as predictive analytics, Pauli said claim service productivity levels should remain high despite adjusters who might have less experience than their contemporary counterparts.
"I don't see technology replacing adjusters; I see technology helping adjusters do a better job and really giving them information," said Pauli. "Technology will allow the same level of people to keep handling increased volumes as their companies grow, but allow them to gain information and have their data be more efficient and do a better job."
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