One of the common challenges insurance companies face when it comes to claims is how they can make the process more efficient for customers. Processing claims takes time and resources, regardless of size. Especially ‘low value’ claims could be processed quickly, as it is not cost-effective to have an adjuster evaluate the damage onsite. New technologies comprise advantages and disadvantages for both insurers and insured.
Mobile technology changes customer expectations
Nowadays, customers are demanding. They want instant results. Mobile technology is transforming customer expectations and it is rapidly replacing traditional ways of communication between insurance companies and their customers. How long will it take before phone calls, emails and paper forms have completely disappeared?
Traditional claim processes
Insurers are addressing the gap between self-serve apps and traditional onsite visits by using technology to engage with customers. Claim apps and visual screening solutions support uploading of mobile photos and videos, thus enabling policyholders to file claims indirectly. Insurers are stimulating customers to quickly show damages and circumstances via their smartphone. These technologies are perfectly applicable for ‘low value’ claims. Large and more complex claims will probably always require an (onsite) claim expert. However, in any case the technology allows the insured to disclose visual information on the spot. This instantly gives the insurer more objective insights concerning the damage (e.g. driving direction, point of damage and environment).
The mobile revolution definitely boosted customer expectations of “receiving what I am asking for immediately.” Claim processing times have been reduced from days to hours, leading to higher customer satisfaction. Visual aids will decrease the initial processing time of claims, since a list of standardized questions will become superfluous. Insurers are better able to separate the wheat from the chaff, helping claim handlers and adjusters to directly recognize those claims that require active follow-up. Moreover, instant insight into the complexity of a claim gives an insurer the opportunity to efficiently determine the need of an expert. On the other hand, requesting visual information from customers may be perceived as unfriendly. Some customers might experience it as an additional effort.
Many insurers already have apps in place to file a claim. The majority of these apps does not yet have visual technology incorporated. FRISS has examined the experience among a large group of insurance companies. These insurers mention that the majority of their customers still picks up the phone to report a claim, rather than using the mobile app. However, these insurers foresee a big change in this approach not far from now.
Modern technology is able to detect fraud signals by screening images and videos of damages. All the information that is filed within a mobile app helps the insurer to quickly assess the involved persons, objects and damages. This makes it possible to identify suspicious cases in an early stage. Asking the right questions and selecting the right information when customers file their claim through an app, are two of the challenges FRISS is helping insurers with. Shortening the claim processing time makes it difficult to take fraud preventive measures. Weak fraud prevention may result into higher legal costs in the end, as unjustified payouts have to be retrieved by the insurance company. Insurers therefore need to maintain the possibility to interfere in the claim process when a suspicious claim is signaled. This enables an insurer to prevent fraud instead of chasing fraud.
Is the insurance industry up for it?
The described technologies are improving rapidly and worldwide adoption is just a matter of time. Integration with current insurance systems is therefore essential, and user platforms are becoming more important. For example: if an accident concerns more than one party, all involved parties must use the same app to file their claim. And to use the app they should all be registered at the insurer. So, which entrant will become the facto standard?