As data drives companies, there must be commensurate investment in the technology to manage that data. A sound investment in good technology has a high multiplier effect; for every dollar invested, the return is more dollars either saved and/or generated. But technology also has the potential to massively change or even destroy entire industries. It can cause widespread disruption.
According to the Oxford English Dictionary, the definition of disruption is “disturbance or problems that interrupt an event, activity, or process.” In discussions with colleagues, clients, and peers, it has become clear that our industry is undergoing significant technology-led disruption and that companies must innovate and deliver new solutions to remain up to date and relevant through that disruption.
So what are a few of the technological disruptions we are seeing either now or on the horizon for claims?
Shift to Direct Repair Networks
Direct repair networks of various kinds have been part of the insurance industry for a number of years, either through insurers building an internal self-managed program or partnering with external contractor repair networks. An example is automobile body shop networks that are well known to auto insurers and many consumers. Repair networks for commercial buildings and home repairs have been growing rapidly in the past decade; out of the top 25 insurance carriers in the U.S., most of them either have a self-managed or outsourced contractor program. Given this trend, it seems likely that any carrier without formal relationships with a variety of contractor programs (auto, home, commercial, etc.) is currently or will be investigating possible partnerships.
Carriers are driving the growth of the “addressable” market for independently managed repair networks as they seek to increase customer satisfaction and drive cost out of the claims process. They recognize that network operators have a mandate to uphold quality and institute processes that lower expenses for themselves, the contractors, and insurers. The contractor network operators evaluate and credential service providers when they join the network, often maintaining annual quality reviews to help ensure consistent customer service. Other management and quality assurance techniques also are in broad use. Some of the rigorous performance management and quality control methods used by direct repair network operators include:
- Electronic estimate review.
- Technical scope and quantity audit per industry guidelines.
- Independent reinspection.
- Customer satisfaction surveys.
- Performance objective monitoring system.
Technology is central to the operations of these networks to control quality and improve efficiencies. Online systems help the insured to request a bid and allow the network operator to monitor contractor utilization and workflow remotely. Mobile devices are used to photograph and log damage, create onsite estimates, and allow clients to commit to contracts electronically. A more recent application of technology has been the use of onsite video streaming, which allows the contractor, network operator, and client to monitor the work in progress in real time and have an objective, authoritative record of the work as it’s performed and completed.
A decade ago, if a speaker announced to a business audience that “There’s an app for that,” it is likely that the less technologically savvy members of the audience would have been confused about why dinner appetizers had been introduced into the context of the presentation. Today, specialized applications for mobile devices (apps) number in the millions and have been responsible partially (along with lightweight but powerful hardware) for the massive shift from old-school desktop and laptop computers to the huge number of sophisticated smartphones and tablet computers that everyone from toddlers to executives use daily.
As with many other fields, claims handling has embraced the unstoppable shift from office to mobile systems, with insurers and ancillary service providers investing in mobile systems to improve processes and stay technologically relevant. More and more features are being added to apps to provide adjusters in the field (or other employees and claimants) with almost every office function needed to handle most aspects of a commercial or consumer claim.
Well-designed apps have streamlined, intuitive interfaces, with much of their complex functionality hidden from the user. But that functionality should be robust and thorough, offering a broad and sophisticated set of features that anticipate the needs of a range of users. After conducting internal research and hearing from a number of information technology experts, we compiled a list of what participants said were essential features for claims handling apps. Consider whether your apps have these capabilities. They said apps should:
- Allow fully automated system-to-system claims intake, reducing manual data entry. The technology functions should include a claimant eligibility check and configurable validation mechanisms.
- Be integrated with claims management systems, which are used as the back-end system for recording claim details and dockets.
- Allow adjusters and claimants to submit supporting claims documentation.
- Allow customization of claims on the front or back end based on clients’ needs, enabling all parties involved in a claim to collaborate on each step in the claims intake and submission process.
- Comply with the payment card industry (PCI) data standard for organizations that handle cardholder information for debit, credit, prepaid, ePurse, ATM, and point-of-sale cards.
- Integrate global positioning system (GPS) coordinates, Google Maps, and satellite imagery capabilities for location tracking and site identification and, possibly, internal interactive social media aspects for collaboration.
- Offer voice-to-text dictation and voice notes that can be emailed, along with video and photograph creation and submission.
- Customizable features for specific needs, such as multilingual capability and or even custom branding by insurers.
- Be available for download from the app store of the related device, such as Google Play for Android, iTunes App Store for iPhone/iPad, and App World for BlackBerry, or from a secure corporate portal.
Facebook, Instagram, LinkedIn, ooVoo, Snapchat, Tumblr, Twitter, Reddit, Vine, and WhatsApp are a few examples of the almost ubiquitous spread of social media, which is capable of reaching both niche audiences or, if something goes viral, touching millions of followers nationally or globally in a very short amount of time, often in just a few days or hours. Social media now touches in some way most of the population worldwide.
Let’s consider Facebook, founded just 10 years ago. By the end of June 2014, it had more than 1.32 billion monthly active users worldwide, and more than 829 million users logged on daily as of the end of June 2014. It could be argued that no other medium has had that pervasive an impact in such a short time frame. The ability to reach that many people directly every day is disruptive. Social media is now an essential tool for two-way communication with a wide variety of audiences, and investing both in tools and people to manage it should be a leading corporate communications goal for any company involved with customers dealing with difficult circumstances.
As with other industries, social media is becoming more and more of a critical communication medium for claims management. Facebook and Twitter have become vital two-way conduits for engaging with the general public, employees, alumni, potential recruits, and claimants who use social media. Given public dependence on social media, it’s reasonable to expect that more and more claimants will choose this medium to interact with companies during the settlement of their claims.
While online interaction with claimants must be managed very carefully due to regulations on personal information, when they contact you, it’s smart to view it as an opportunity to help resolve an issue and, hopefully, maintain a positive public reputation. These claimants also provide an informal quality assurance measure since they provide evidence—albeit anecdotal and sporadic—of how you are or are not meeting their needs.
Twitter is a dynamic tool for immediate communication with many professionals and claimants. It has been used as a forum to comment on industry events and announce new services and senior executives, and adjusters have tweeted their statuses as they arrive on the site of natural disasters to begin their work.
This discussion has touched on just a few disruptions that have affected claims handling; a larger discussion covering more examples would take up most of this issue. As with other factors affecting business, the best methods for managing disruption are to be aware of what’s happening in your industry and society, try to innovate to get ahead of trends, and, when necessary, react quickly to adapt to the new and different environment.