Insurance policy administration is a critical part of an organization’s overall risk management framework. That means understanding risk and coverage needs, getting insurance policy quotes, selecting the best policies, and managing renewals among other tasks.
But insurance policy administration isn’t always smooth sailing.
Here are the most common obstacles insurance policy administrators face and ways you can improve your administration systems to overcome them.
Obstacle 1: Slow Closing Times
Efficient insurance policy administration means minimizing the time between incident intake and resolving the claim. But the time it takes to close a claim can increase due to inefficient data collection and analysis processes.
A robust claims management software program accelerates the process and achieves faster closing times. For example, using survey-style questions in the intake process speeds input for individuals entering their information and may reduce errors. It also facilitates document management and the payment process.
Together, those features streamline intake and improve customer engagement, resulting in significantly reduced closing times.
Obstacle 2: Claims Going to Litigation
Litigation is costly and is one of the top cost drivers in claims management. Effective administration of insurance policies reduces litigation as much as possible. The problem is that it can be difficult to know which claims potentially trigger litigation ahead of time. Without that foresight, you might not have time to take action to mitigate litigation in time.
An effective way to reduce the risk of litigation is to set up a system for predictive analytics. With the right data and predictive models, you can predict which claims are at risk of litigation. That way, you can take pre-emptive action on those claims to catch them before they go to court.
Obstacle 3: Inefficient Processes
Risk and claims professionals have increasingly heavy caseloads. Without an efficient set of processes in place, large caseloads can quickly become overwhelming. They can also prompt the expansion of the administration team, and increase staffing costs.
The best way to overcome inefficient processes is through robotic process automation, built into modern risk management systems. Robotic process automation sounds futuristic, but really it just means automating the repetitive parts of the claims management workflow. For example, you can set up your systems to automate gathering intake information, entering data into forms, and verifying values to reduce errors.
Eliminating the manual “busy work” from the claims process reduces costs, improves delivery, and helps ensure quality. It allows policy administrators more time to do higher-value work like providing better customer service or making strategic decisions.
Obstacle 4: Policy Pricing and Negotiation
Ultimately, risk managers at any company want to secure the best insurance terms for the lowest price. That means negotiating with insurers. If risk managers can't rely on a risk management information system to support them, they may indeed be under-prepared for negotiations.
Overcome this challenge by using your risk management information system (RMIS) to give you the data you need for negotiation leverage. For example, your RMIS can tell you your claim volume, your policy information, and data about your risk exposure. You use it to explain to your insurer exactly how much your claims have decreased and why. Being able to demonstrate changes in your risk profile can help you agree to better terms or prices.
Obstacle 5: Knowledge Gaps
Managing insurance is complicated because each policy has its own complex set of rules and variables. Even with a skilled team of experienced administrators, it isn’t always easy to confidently choose an appropriate plan or navigate claims. Often there’s a knowledge gap—your team may not understand all the ins and outs of a policy, its coverage, costs, and your company’s own insurance needs. Knowledge gaps can limit your ability to make effective policy administration decisions.
One way to overcome this gap is to use policy and program management software that makes it easy to see your entire portfolio of policies in one place. It can help you keep track of the premiums, fees, and taxes for each policy program while also offering all of the coverage details, limits, and policy documentation.
Some systems—like Ventiv’s—even allow you to integrate your policy and program management into a risk management system, empowering your team to compare the details of your policies together with your risk management activities.
Together, these features allow you to quickly fill gaps in knowledge about your current coverage as well as your policy needs.
Overcome Obstacles in Insurance Policy Administration with an Integrated Risk Management Software Tool
A comprehensive insurance policy management tool is the key to overcoming the most common challenges that policy administrators face.
Ventiv Technology’s RMIS overcomes these obstacles for risk and policy administrators. It saves time and reduces your total cost of risk by up to 9%.
To see how an RMIS can help you streamline your insurance policy administration processes, book a free demo.
