3.5 Things to Know About Claims (Part 2) - Insurance Thought Leadership

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April 11, 2018

3.5 Things to Know About Claims (Part 2)

Summary:

Even if you're having trouble innovating in claims processes, you may be able to find an insurtech that will do it for you.

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Part 2 – You CAN reduce your claims expenses and improve the customer experience.

In Part 1, we looked at how your claims processes and systems are a customer experience issue. This time, I will dive into the fact that you can reduce your claims expenses while improving the customer experience. A recent article in A.M. Best’s journal shared a survey that indicated the top two items that needed technology improvement are:

–Improving the customer (and agent) experience.
–Legacy administrative and claims systems.

Reducing the claims expenses of a company does not have to mean a reduction in the customer experience. Improving the customer service or experience does not mean you need to increase expenses by adding human capital in the company. I have learned that there can be a happy medium.

See also: Finding Efficiencies in Claims Process  

Here are some questions and thoughts to keep in mind as you and your team evaluate ways to reduce the claims expenses while maintaining or enhancing the customer experience:

Does your company have a proactive or reactive digital strategy?

Digital strategy and digital capabilities are not the same thing. I believe digital channels and experiences are going to change the insurance industry. You must meet your customers where they are and want to meet. If that is mobile, then you need a way for your customers to process claims on their mobile devices. And not just some functions, all of the claims functions. Have you ever started a process on your mobile device only to go down a path that leads to – “We apologize, that function is not available on our mobile app, please go to www dot…” (You get the point.) It is frustrating, to say the least.

Insurtech: Does your company just talk about it, or do you actively engage in it?

Talking about insurtech and actively engaging are two different topics of discussion. Here is what I have learned in building businesses. A business is always in one of four phases at a given time: innovating, pivoting, growing or dying. Ask yourself, which category are we currently in? Let’s hope it isn’t the last category. Insurtech can help your company with the first three categories. However, you must become engaged. This means reaching out to insurtech companies and taking a new approach by working with them. You may be pleasantly surprised by what they can offer to you, your team, your company, your customer experience and your bottom line.

Are your legacy systems hindering innovation, or even preventing it?

Let’s discuss item #2 of the A.M. Best survey results. I can tell you from experience; When I inquire about legacy systems at life insurance companies, I hear a sigh. This is not a sigh of happiness, it is a sigh of not wanting to discuss this subject. At all! Most people almost cringe at the thought of discussing the legacy systems.

See also: Top 10 Claims Trends That Will Affect 2018  

Here are the facts: Your legacy systems exist and are currently a necessary part of the business. They will probably get phased out or updated. This process is going to be expensive. But does it have to be? What if an insurtech recognized this issue as a barrier to entry for its product or offering and decided to tackle the legacy issue head on? What if it could connect to your legacy systems and complete the claims processing functions while delighting and providing WOW to your customers? What if it could accomplish this with minimal resources and at a reasonable price?

My point is there are many ways your company can be innovative. If you start to have an open mind and explore some of the insurtech companies out there, you may get all of the innovation your business needs! Stay tuned for Part 3 of this article to learn how your claims process can become a revenue driver for your products.

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About the Author

Brent Williams is the founder and CEO of an insurtech company called Benekiva. His mission is to provide disruption in the insurance industry with a “beneficiary first” mindset and digital transformation technology.

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