Welcome to Part 1 of “Digital Claims Processing”, in which we take a look at creating an effective claims strategy. A strategy that utilises digital within the claims process to deliver better claims effectiveness, efficiency and customer experience.
Digital claims is a hot topic in the fast-moving insurance world. Competitive forces are driving a more complex operating environment that requires interfaces to be simpler and more responsive for customers.
But what do we really mean when an organisation says it wants ‘digital claims?’
Let’s not forget the founding principles behind digital transformation. Just as you don’t want a drill – you need a hole – no insurance firm wants ‘digital claims,’ either.
Instead, they require a solution that improves claims process effectiveness, efficiency and customer experience (CX).
Future of Digital Claims: Think Customer First
You’ve heard it before, but the best digital claims approach is a customer-focused one. Look at the claims process from the customer perspective and aim to make the customer process fast, simple and intuitive.
That sounds straightforward. Yet, it’s easy to overlook one of the key aspects of digital transformation: to view the process – and the subsequent app or interface – through your customers’ eyes. What’s more, you can’t make your customers attend systems training – so everything has to be simple and intuitive. Unlike employees, customers don’t have to use your digital app; they have a choice. This forces your organisation to focus on usability and speed. As a result: fast, simple and intuitive is the mantra.
This is supplemented by:
- Full automation for clear, simple cases with payments made immediately post first notification.
- Feedback loops, whether managed digitally, on the phone or a mixture of both. This will continually improve service offerings, usability, and performance.
- Transparency throughout the claims process, enhanced with regular digital updates.
- Automated Artificial Intelligence (AI) based triage. This ensures that the appropriate professional handles the claims in a timely manner post-notification.
Digital Claims: The Demand For Personalised Policies
The future of claims is bespoke, customised to meet each customer’s requirements. These requirements, in turn, come from custom policies; multiple endorsements, cover limits and different levels of coverage. Different sales channels may also have different claims handling requirements. Validating claims will inevitably become more complex and will need to deal with all these custom elements.
In addition, exotic types of specialised insurance are on the rise. This can only increase the amount of corresponding custom claims handling. In addition, the world of specialist insurance, with exotic coverage variations, will evolve quickly. Consequently, firms must be able to respond to these market changes quickly in order to survive.
The key takeaway here is: claims handling will need to seamlessly adapt to variation and change. Integration with digital policy management systems will help.
Digital Claims & eFNOL (electronic First Notification Of Loss)
Is the ability to replace phone calls with an entirely digital process a cost reduction feature? Is it a customer experience initiative? Can it be both?
The first point to make is that traditional FNOL (post paper claims forms) involves a telephone call and a claims professional. Together, this creates several datasets. This typically consists of customer data, claims professional opinion data and technical data.
Concluding; eFNOL definitely is key, for customer convenience in the future of digital claims, but with the following caveats:
- eFNOL only collects customer data. Therefore, it is more a replacement for paper claims forms as opposed to a tool that automatically removes all of the effort involved to initiate a claims process.
- The electronic process must evolve as the claim does. Telephone claims unfold to reveal subtleties that weren’t apparent to start with. The skill of the call handler is to add or remove data as required. The e-version must replicate this subtlety to be effective. Even then, the process may still need a follow-up call.
- The eFNOL process must be built for mobile first. Customers expect digital processes to be slick and responsive. When building a process, it needs to deliver a great customer experience on their device of choice; most commonly, at present, a mobile device.
LEAP and eFNOL
MICology LEAP low-code benefits the eFNOL process in the following ways:
- Ease of use: our unique technology means customers can access the fields defined in the claim via a simple link.
- Complete: both customer and agent can upload documents and images.
- Adaptable: it’s easy to update the process in real time as changes take place, so the process evolves as time goes on.
What’s more, the LEAP platform can automatically assess incoming data and respond with further requests if required.
Digitisation brings both opportunities and challenges. For example, implementing digital communication and digital content is now much more cost effective than it once was. On one hand, this creates a fantastic opportunity to reduce the face-to-face costs of explaining claims to customers. On the other hand, it’s important to ensure that customers are not left struggling to access the information they need. This of course may result in more enquiries, rather than less.
Fortunately, process digitisation helps us overcome this challenge. When we augment the digital workflow with digital ‘explainers’ (e.g documents, infographics, animations or videos), customers naturally enjoy a better experience. When we create with the customer in mind, we reduce the number of enquiries during the claims process.
Digital Claims & Assessment
Before determining the precise claim type, the handler must assess and validate incoming eFNOL data against the policy. For example, location, time and cause. Then, the handler must assess the likely severity/financial cost of the claim. Only then can they determine whether they require more information to proceed to settlement. Thanks to digitisation, we can carry out this triage automatically and get the claim to the right team or teams, reducing process time.
How MICology LEAP Helps With Digital Claims & Assessment:
MICology LEAP can implement this stage using a number of technologies. For example: Digital Workflow managed manual assessment and rules based automation. We can also help with Data Curation and implement an AI Framework with artificial intelligence (AI) derived algorithms.
Information Collection / Investigation
Collecting information post FNOL assessment is the biggest resource drain for most claims processes.
Information Collection has a high level pattern that has two elements:
- What Data is required to validate the claim and/or information/evidence concerning losses?
- Who is going to provide the Data?
This can be an iterative process. More data is added, creating questions that require more data.
How LEAP helps with post FNOL/eFNOL:
MICology LEAP low-code has a number of technologies that can help organise and speed up this stage. For example, LEAP offers a ‘pending items’ technology that automates the collection of data/documentation. What’s more, LEAP can also automate the inevitable ‘data chases’ that result at this stage of the process. Finally, we can configure an electronic ‘schedule of loss’ questionnaire to digitise the financial part of the claim.
All of this ensures that important information doesn’t slip through the net, and that actions take place in a timely, accurate manner.
Direct Repair / Replacement Programmes
Not applicable for all types of claim, but where it reduces claims costs, a Direct Repair or Replacement Programme can be offered. To be successful, any direct repair or replacement programme must be part of an integrated digital supply chain. This enables the latest process updates to flow seamlessly from supply chain partner to the customer via the insurers’ system. As a result, this both boosts efficiency and reduces failure demand. That’s as well as providing a wealth of data to help the business improve the customer experience.
How MICology LEAP helps improve direct repair programmes:
LEAP allows businesses to create digital Customer Portals. These map the sub process being performed by the supply chain partner. Updates in the process notify the customer via their choice of digital media. As a result, the customer feels in the loop at all times.
Part 2 of our article continues our deep dive into the future of Digital Claims, covering Adjudication, Negotiation, Settlement, and Digital Decision Making.
About the Author
Edwin Harrell is a technology entrepreneur specialising in digital transformation and process design. Edwin worked as part of the team that founded and later listed WNS Holdings, a global business process outsourcing organisation, on the NYSE. He is the founder of MICology; a technology business specialising in low code and digital business process management software.