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The Future of Insurance Claims Administration Is Automation

Claim administration is a vital part of the insurance value chain that is used to measure consumer satisfaction among other factors. With consumers demanding faster services, manual claims administration processes are being replaced with automated processes that make processes easier.

Companies can achieve automation by using claims management software that helps to automate processes, collect and analyze data, and reduce human interactions that delay processes. This is important if companies want to retain customers, 41% of people surveyed indicated that they will likely switch insurance for a lack of digital capabilities.

In this article, we will look at the future of claims administration.

The Future of Claims Administration Automation

Current automated claims processing solutions include:

  • Aggregation of data for analysis
  • Comprehensive mobile platforms
  • Remote collection of claims data
  • Centralized claims data warehousing

In the future, claims administration automation will be driven by several key changes.

Changing Consumer Needs

Consumer needs continue to evolve. During the pandemic, more customers embraced digital channels to engage with insurers, and most new customers use digital tools to shop for the best insurance packages.

To accelerate automation, many companies are now using First Notice of Loss (FNOL) via automated channels like self-service apps to reduce the amount of time it takes to process claims and reduce costs. In the future,  telematics sensors in vehicles may be able to file the claim without human intervention for a more touchless process.

For example, an auto insurance holder's claim can be filed once an accident happens with the use of telematics sensors in a home or car and integrated with a self-service app. When an incident occurs, the sensors may initiate automatic loss adjustment activities like a request for pictures. Once images are received, they can be converted and accessed automatically using artificial intelligence (AI) as part of processing. Robo advisors may be deployed to guide customers through the rest of the process.

Automation may also provide additional information, such as geolocation of auto accidents, speed of travel, and point of impact to help further assess claims and speed up appraisals.

Digital Transformation

With the advent of new technologies like AI, machine learning (ML), the Internet of Things (IoT), and blockchain technologies, digitization has already changed the industry and will continue to drive changes. 

The use of machine learning and artificial intelligence has made it easier for claims managers to assess on a deeper level the severity of a claims process based on data collected and hence properly segment these claims. 

Segmentation of claims will enable claims managers to automate processes that will divide claims into simple, medium, and complex cases. If the case of a claim is assessed to be simple, it may be assigned to an automated chatbot that will see the process through. Where it requires human intervention, a person will be assigned to take up the claims processing. All this will help to reduce the time used in assigning workloads and processing claims.

New possibilities for claims administration will also see the use of IoT to pull information from different touchpoints to better assess a claim or even prevent a claim. 

Claims administration will no longer just be about processing claims but about preventing them through the use of data available to the claims managers. For example:

  • In areas that are liable to low temperatures, electronic sensors connected to the owner's app and the insurer's software will be triggered to turn up the heat in a home once the temperature falls below certain levels. This will prevent pipes from freezing during the winter period. 
  • Homes that are located in hurricane-prone areas will deploy hurricane shutters once they receive updates on weather changes sent from the insurer. 
  • In manual-labor jobs, sensors embedded in workers’ clothing and machines will prevent physical or mental fatigue by prompting workers to take breaks. When workers step out of “safe zones,” sensors monitoring their movements will send an alert that stops their machine automatically, preventing injury.
  • An organization could install new flooring that changes color when wet to highlight hazards that could lead to injuries.

These are just a few examples.

Fraud Prevention

Fraud in the insurance industry accounts for about $80 billion loss in the US alone. The future possibilities will see an increased use of blockchain technologies in claims processing to reduce fraudulent claims activities. Claims will only be paid out when all the indices that indicate a genuine claim are met. 

Another possibility is the increased use of artificial intelligence to estimate claims and calculate the probability of claims happening based on historical data. Artificial intelligence can also be used in real-time to compare the data and identify suspicious claims and avoid getting them paid by flagging them for more investigation.

Moving Forward

The future of claims administration lies in automating less critical aspects of the claims process to streamline the claims administration process and make it faster. 

 Companies wanting to remain relevant can invest in systems that help them keep ahead of the times and position their businesses to take advantage of the ever-changing insurance landscape, can learn more by talking to the claims administration software experts at Ventiv Technology today.

 
 

Aug 10, 2022

 | Originally posted on 

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