In personal lines insurance, there's a heavy reliance on what a new policy administration system can do for a carrier, but in claims, the approach is different, particularly when it comes to an investment in new claims systems.
"A lot of rules—that's what run claims systems," says Karen Furtado, a partner with the research and consulting group Strategy Meets Action. "There also are a lot of reminders, which is why workflow is so important."
Many carriers operating with older claims systems are still trying to get their work done without the benefit of an imaging system, something that Furtado finds amazing.
Furtado sees the shift taking place for carriers when the discussion touches on areas such as retention and growth. Furtado maintains those areas are focal points for delivering customer service, and claims, more than ever, is viewed as a customer service area.
"With customer service comes a lot of automation," she says. "You need to have some type of portal to provide agents and insureds claims information. Those areas have not been transparent in the past, which is why automation is finally beginning to take root. Positioning for the future means going beyond a claims transaction itself to combine the agent and third-party networks into the process."
Furtado believes mobile systems will spark new investments in technology.
"Mobile has such a high adoption rate," she says. "There remains some skepticism among adjusters over whether an iPad is sturdy enough to be used in the field, but [adjustors] understand mobile devices can make their job easier and more efficient. There is less work on everyone's part if they can take a device with them into the field."
Furtado believes the adoption rate among insurers around mobility is coming at a "lightning pace" when compared to other technologies.
"There are some insurers struggling with it—their sites don't work as well when rendered on mobile devices—and they are putting money into the front-end part of the process," she says.
The survey showed claims leaders don't believe their companies supply them with the resources they feel are needed and Furtado believes the reason for this is quite simple: "Claims isn't tied to revenue," she says.
For many carriers, IT spending focuses on rates, rules, and forms.
"IT people don't spend the majority of their time focused on claims and that's why some claims people feel they don't get the attention," she says.
Furtado believes that could be changing, though.
"Being able to provide more information when and where it is needed is, to me, the key to a successful claims operation," she says. "Updating systems and higher adoption of workflow and imaging is making the process easier."
While small- and mid-tier insurers are playing catch-up when it comes to upgrading claims systems, Furtado believes the importance of analytics to claims will spark more spending.
"Tier one is in the lead pack because they've been key adopters of predictive analytics, which is tied with the maturity of the organization," she says.
Early adopters of analytics focused on areas such as market segmentation and rates, according to Furtado, but that is changing with the use of predictive analytics.
"More insurers are using predictive analytics to assist both in claims assignment and in understanding risk at a more intuitive level," she says. "Claims with certain attributes can escalate quickly, so carriers manage those cases with their veteran caseworkers. It's getting the right piece of work to the right person."
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