Insuranceciooutlook

Leading Technologies to Enhance Insurance Claim Processing

Insurance CIO Outlook | Thursday, September 29, 2022

Insurance companies and policyholders benefit from efficient claims processing.

FREMONT, CA: Claims processing encompasses all procedures during which the insurer verifies the loss, policy, and event information necessary to calculate and pay out its liability to the policyholder. The first notice of loss (FNOL) is submitted and ends with either denying or transferring funds to the customer.

Effective claims handling boosts both the profitability of insurance firms and policyholder happiness.

According to Deloitte, over 70 percent of insurance business expenses are attributable to claims processing. Good claims management is linked to effective insurance fraud detection and prevention, as most fraud types, such as hard fraud and double-dipping, occur during claims processing-related timeframes.

However, approximately 10 percent of the overall claims expense is attributable to false claims. Consequently, approximately ninety percent of claims management involves resolving a customer who has suffered a sad event. It is, therefore, not unexpected that 87 percent of consumers consider claims processing efficiency to be a consideration for switching carriers.

Chatbots

Chatbots powered by NLP can streamline the FNOL and payment negotiation phases of claims processing. The insurance firm can utilize chatbots in customer support, its website, and its mobile application.

Chatbots can serve as policyholders' initial point of contact when filing a claim. They can direct consumers to take photos and videos of the claim and inform them of the necessary paperwork to submit, thereby expediting the FNOL submission. Insurers can also benefit from chatbots by contacting policyholders to arrange payments or address their questions. Chatbots automate customer relations in any case.

Optical character recognition (OCR)

OCR is an additional NLP-based technique that extracts meaning from handwritten documents and classifies them. As a result, the first claim processing and policy check processes of claims processing are enhanced.

The processing of handwritten documents, including witness statements, policyholder statements, and police and medical records, is required for the first claims investigation and the policy check. As a result of OCR, insurers may automate the extraction of data from such documents and direct their attention to claiming processing tasks that require human intelligence.

Computer Vision

Computer vision models extract information from visual inputs such as photos and videos. Therefore, they can aid with the first examination of claims. Computer vision models can estimate the cost of a loss by analyzing data from videos and images captured by policyholders or claims adjusters. They can assist insurance businesses in predicting their liabilities and organizing their financial resources following those projections.

Advanced analytics

Advanced analytics are algorithms that enable users to make more accurate future predictions. These technologies are adept at discovering and understanding correlations and are therefore beneficial for the first claim investigation, policy check, and payment calculation aspects of claim processing that we stated previously.

Insurers can use the reports of adjusters and experts as input data for sophisticated analytics to anticipate actual claim expenses. Advanced analytics are also suitable fraud detectors because they can spot patterns in fraudulent activity. Specifically, behavioral analytics can be utilized to determine whether or not the claim complies with the policy's requirements. Such programs examine surfing histories, clicks, location, etc., and assist insurers in assessing the veracity of policyholder claims.

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