How insurers are turning to technology to process your claims
New ways of using technology are allowing insurance companies to process claims faster and more accurately. The effects on consumers include improved service and quicker payments — but so far, at least, not lower premiums.
Atmospheric and Environmental Research of Lexington, Mass., has introduced an offering that lets an insurance claims manager log into an online portal after a big hailstorm and pull up a detailed map of the storm’s track. Numerals on the map give, for instance, the estimated maximum hail diameter in inches for specific locations. Red circles show where the carrier has policies with insured values of, say, $500,000 or more. A bar chart reveals how many insured properties likely encountered 2-inch or larger hailstones.
|Insurers are adding high-tech twists to the claims-filing process, pushing it beyond the traditional in-person setup.|
Being able to easily visualize the impact of a storm using highly detailed digital maps helps insurers in a number of ways, says Brenda Kelly, vice president of Atmospheric and Environmental Research. For instance, Kelly says, the maps can determine whether insurers should send in more claims adjusters, “perhaps flying people in from another location.” That can speed up processing of claims, resulting in checks getting into the hands of policyholders more quickly.
Rolling out smartphone apps
Other examples of claims-processing technology are much more visible to consumers.
Former insurance claims adjuster Ashley Hunter, president of HM Risk Group in Austin, Texas, points to smartphone apps that some insurers — such as Allstate and State Farm — are making available to consumers to help them file claims after auto accidents.
“You can take pictures and upload the claim information right to the website,” Hunter says. “You type in all the claim info like the name of the insurance company of the other driver. It’s very sophisticated. And they process the claim immediately.”
Tech tools for fighting fraud
Claims processing also is tapping technology well beyond the public’s view in the form of predictive modeling for identification of potentially fraudulent claims.
Rob Hoyt, director of the Risk Management and Insurance Program at the University of Georgia, says is a new wrinkle for technology that’s long been employed to help figure out rates for policyholders. Instead of just trying to forecast how many claims are likely to be filed by a given policyholder, insurers are using predictive modeling to pinpoint common traits of fraudulent claims.
“There are patterns that tend to be consistent with suspicious claims,” Hoyt says.
Such claims tend to be distinguished, for instance, by particular types of vehicles and by how long a policyholder has been insured with a given company. When insurers can more accurately and quickly zero in on possibly fraudulent claims, they can more efficiently investigate them. That can lead to lower operating costs and possibly more money in the pockets of policyholders.
A speedier process
So far, lower premiums for consumers remain an unproven benefit of claims technology, however. “We can always hope, but there’s no cost savings being sent down to the customer,” Hunter says.
She does emphasize, though, that customers are gaining benefits from this technology, mostly in the form of faster claims processing. “As far as an auto claim is concerned, if liability is clear, they’re cutting checks within 24 hours,” Hunter says. “Before, it was taking about a week.”
If you’d prefer that this automation of claims processing simply go away, don’t hold your breath. Kelly expects more and more claims technology to be rolled out across the industry. But Hoyt says it’s not likely that insurance software will replace insurance people, either.
“I don’t see it ever being such an exact science that there won’t be human judgment involved,” Hoyt says.