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Claim Processing 2022- Insurance CIO Outlook APAC

Insurance CIO Outlook | Wednesday, May 25, 2022

With digital transformation in full swing, property and casualty (P&C) insurance claims were meant to be the tip of the spear. However, from the perspective of digital consumer experience, the industry lags significantly behind financial services and utility companies. According to the J.D. Power 2021 U.S. Claims Digital Experience StudySM, none of the essential key performance indicators meet even half their targets, and adoption remains persistently low. Only 40% of claimants communicated with an estimator via digital means this year, and only 47% of claimants submitted a claim via a website. On the other hand, the leaders in the banking and wealth industries are yielding the power of digitalization with their web and mobile apps to meet their clients’ changing expectations. Such instances can be a reference for insurance industries to understand where client expectations have gone over the past several months. Simple, easy-to-use tools, such as accounts calculators and estimators, help clients set reasonable expectations and give vital information along the process line and go a long way toward increasing end-user satisfaction and engagement.

According to the U.S. Claims Digital Experience Study, assessing P&C insurance consumers’ digital experiences throughout the claims process, 40% of claimants communicate with their claim estimator through digital channels. In comparison, 49% communicate with their claim estimator over the phone. Such disruption in digital experiences makes the claimants lack options to communicate via the channel they choose, and they often feel forced into a one-size-fits-all experience. To avoid such inconveniences for the customers, digital chatbots and online resolution can be very effective at handling most consumer concerns and complaints. Assistance via digital platforms proved successful in maintaining clients, especially the tech-savvy younger generation that prefers to communicate online and transact through digital platforms.

“The idea is to employ AI's capabilities to tap into the vast volumes of consumer data accessible to build personalized experiences based on a person's preferences and behaviors”

Consumers also expect individualized experiences, especially when purchasing something as crucial as property and casualty insurance. Artificial Intelligence (AI) allows insurers to build these one-of-a-kind experiences while still fulfilling the growing demands of modern consumers. The idea is to employ AI’s capabilities to tap into the vast volumes of consumer data accessible to build personalized experiences based on a person’s preferences and behaviors. In addition to it, insurers can also use AI to improve claim turnaround times and radically alter the underwriting process. AI also allows insurers to access data more quickly, and eliminating the human element can result in more accurate reporting in less time.

The modern technology of telematics as technology that can be implemented in cars can also be implemented in insurance technology. Cars can now be equipped with monitoring devices, such as Progressive’s Snapshot, that measure a variety of indications such as speed, location, accidents, and more, monitored and processed with analytics software to assist in calculating policy rates. Likewise, telematics in property and casualty insurance will save insurers money by lowering their claim expenses and also change the relationship between the carrier and the client from reactive to proactive.

The fundamental procedures are often slowed by substantial on-premise legacy technologies, which are weighing down insurers around the world. As the cloud evolves, insurers will be able to launch new products more quickly and provide better customer service by rapidly moving their critical operations to the cloud. The cloud will also be crucial for providing the type of processing capacity required to completely comprehend and utilize the massive data collections (such as tens of millions of claims data points). Cloud-native insurers will be best positioned to operate as ecosystem orchestrators as ecosystems continue to emerge internationally, operating as a connecting point among clients, distributors, insurtech, healthcare providers, carriers, and reinsurers, among others.

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Insurance firms have made considerable headway toward becoming much more customer-centric organizations, but there is still much more work to be done. While many companies claim to have a single view of the customer, some insurers have succeeded in designing sleek user interfaces, but the fact is that many silos still exist behind the scenes, each with its own processes and data sets.

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