Tag Archives: Claims Technology

Why Engaging an Independent Claims Expert is so Critical to Successful Technology Implementation

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Yes, I am biased. I am an independent consultant, but I have also worked at a large consulting firm.  The current insurance environment is in a rapid state of change, where claims departments are struggling to be competitive and efficient due to increased claims volumes and complexities. Technology could transform every step of the claims process, from intake through resolution—but successful implementation requires more than just technological know-how. But to make that a reality, subtle understanding is needed from the claims landscape itself.


To bridge this chasm, what insurance leaders require is not some standard-issue consulting firm but a professional claims expert well-versed in the deeper nuances of the claims process. For large implementations that span multiple years the large consulting firm can be an invaluable resource.  However, when the implementation is small or your company is smaller,  hiring an independent claims consultant can make all the difference in realizing a technology implementation that not only transforms the operations but does so with efficiency and precision.

1. Process-Driven Technology Integration: Understanding Claims from the Inside Out


The processing of claims with high levels of accuracy and efficiency, but with empathy nonetheless, constitutes the core mission of the claims department. Without an implementation approach which places the process of the claim at the forefront, technology can quickly turn into a disruptive force rather than a supporting tool. Unlike larger consulting firms, independent claims consultants focus on bringing in technology to meet the unique workflows and departmental business objectives. This ensures that the process of claims drives the technology, not the other way around.

2. Solutions Customized with Flexibility for Real-World Claims Challenges

Independent claims consultants bring an unprecedented level of agility and customization that larger firms simply cannot match. Because they are not bound by rigid frameworks, they can move more nimbly to meet the particular needs of each department, from property to casualty claims, without unnecessary layers of oversight. This will introduce flexibility for active consultants to tailor solutions within the existing ecosystem, including claims data analytics, fraud detection, and maintaining the human touch necessary in ensuring customer satisfaction.

The scalability of the solution will also be catered for by a focused consultant to enable your department to evolve with the technology over time. They have practical experience in how to spend each working day projecting the daily challenges an adjuster and manager face so that the technologies implemented will be as pragmatic as they are innovative.

3. Cost-Effectiveness: Maximize ROI without the Big-Firm Overhead

One of the values in retaining an independent consultant over a large consulting firm often has to do with bottom-line economics. Independent claims experts are unencumbered by all of the trappings and demands of higher overhead-greater office space, for example, more administrative personnel, an extensive marketing program-and maintain a lean approach focused exclusively on delivering results. That is to say, more of your budget is directly invested in the project, yielding a larger return on investment for your claims department.

Another major factor: essentially, independent consultants have a stake in the success of every case. They will work hand-in-hand with internal teams, offering hands-on guidance throughout the process. This kind of processing will typically result in faster project turnarounds and faster adoption, which means a faster return on investment.

4. Proven Process: How a Claims Consultant Drives Successful Implementation

New technology implemented within a claims department requires a clear, structured approach beyond generic project plans. Here is one specific way an independent claims expert would drive a successful implementation, step by step:

  • • Assess and Plan: First, take a deep dive into where current claims workflows enhance pain points, resource needs, and department goals. The result is that the technology solution will focus on the particular needs of the claims department, not just industry standard needs.
  • • Solution Design: Having worked in close cooperation with the department heads, the consultant now designs the solution to be adapted for smooth integration into the workings of the department. The focus is then on nuances of the claims process, so that one may target areas where technology will add value without disrupting processes.
  • • Pilot Testing and Iteration: Before the rollout, pilot testing paves the way for live insights and iterations. A claims-focused consultant can quickly identify and rectify any issues to make technology work right in the life conditions of claims.
  • • Training and Adoption Support: The successful implementation of technology requires user adoption. More often, independent consultants provide hands-on training, tailored for different roles within the department. They help each member of the team understand how the new technology makes their workflow easier and more intuitive to perform their tasks.
  • • Ongoing Review and Adjustment: The true claims expert knows that after implementation, the work is not over. They remain involved with performance monitoring, suggesting adjustments, and ensuring the technology meets their changing needs.

5. Partnership, Not Just Completion of the Project

Probably one of the most valued elements in working with an independent claims consultant is the relationship they will build with your team. Unlike larger consulting firms that might simply focus on delivering the project and moving on, independent experts truly invest in a partnership. They work side-by-side with internal teams, understand their challenges, and adjust in real time to feedback for long-term success. This harmony makes for trust and confidence in the new technology as team members learn to fully welcome the change. Over time, the partnership offers consistent ways it assists departments in not just attaining immediate implementation goals but also in fostering a culture of continuous process improvement and innovation.

The Strategic Advantage of Partnering with a Claims Expert


The challenges of claims implementation require much more than a one-size-fits-all solution. In engaging an independent claims expert, C-suite executives and claims leaders receive a partner focused on expert-level talent, flexibility, and hands-on involvement their large consulting firm counterparts often cannot match. Using their specific knowledge, they make sure that new technology underpins the claims process for tangible gains in greater efficiencies, customer satisfaction, and financial performance, amongst other benefits. The right consultant will be the difference between ‘disruptive change’ and a ‘transformative solution’ in today’s competitive insurance landscape. Embrace expertise that puts your claims process first, and watch technology become an enabler of growth rather than just another operational hurdle.

4 Areas Of Concern From The Latest Insurance Executive Conference

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Gaze into your crystal ball and predict the issues of the past year to be addressed in the coming one!

It’s that time of year. The top 10 lists, the reflections, the can I possibly attend another holiday party and survive through to New Years? Well I will not give you a top ten list but I will list out 4 key issues that seemed to highlight the sentiments of the speakers at the 23rd annual Executive Conference recently held in New York.

The title of the conference was “Driving Growth in the Life and Property-Casualty Insurance Markets.” The annual event brought together several key executives in both the Life, Health and Property & Casualty Insurance arena. This year the audience heard from the likes of Starr Insurance, Endurance Specialty, Aspen Insurance, Lincoln Financial, ING, and Zurich Global Life among others.

Nothing too shocking with these 4 issues to address

While the topics of discussion varied from panel to panel, a set of themes emerged from the various discussions. When looking back over the last year, and forward into the future, it seems that there were consistently 4 areas that these business leaders seemed to be concerned about. Each issue impacted each company differently, however, the the themes permeated throughout the program.

  1. Technology and the use of data.  A somewhat mixed statement about technology seemed to emanate from the various speakers. On the one hand it was acknowledged that the industry lags behind in adopting and using technology. Many companies still are working off antiquated systems that could use an overhaul. On the other hand it was noted thatthe industry is filled with valuable data that needs to be analyzed and used to improve outcomes. Companies that can use their data more effectively will have a critical differentiator in the future. Predictive analytics and modeling will be the key to increasing underwriting profit needed in these times of continued low interest rates.
  2. Climate change and catastrophes. With the conference so close to the events and location of Sandy, the talk of underwriting and managing CAT losses was on the mind of many. There is a clear belief that climate change has affected weather patterns and will continue to create larger storms for the foreseeable future. The importance of getting the appropriate rate for risks, being better prepared from a continuity perspective, and looking to opportunities to underwrite new risk and innovative risks were just some of the topics discussed. Some of the issues around CAT management also related to governmental intervention that effectively re-wrtie contracts making it more challenging to underwrite.
  3. Increased regulations. Solvency II, the fiscal cliff, the impacts of Dodd-Frank legislation, Systemic Risk (systemically important financial institution (SIFI) designation), the Federal Insurance Office’s (FIO), unclaimed property,  tax compliance with SSAP 101 and FATCA are just some of the many potential compliance issues that could increase costs and expose companies to additional fines for non-compliance. While the general feeling was increased regulation was not going to change the industry for the better, the need to deal with changing regulations was going to have a real impact.
  4. Social media as in customer relations as well distribution. Social media is here to stay and many have begun to address how to use this medium in both dealing with customer complaints or improving customer relations. There was a clear acknowledgement that social media can be the genesis of grass roots negative campaigns unless managed correctly.  A few panel members spoke of how they have created new ways to communicate with customers and create more positive images around their products and services.

Looking ahead to 2013

I think the themes expressed by the insurance leadership at the conference need to be dealt with in the foreseeable future. Addressing technology and using data analytics will be the key to building productive, profitable and efficient organizations.  That is all well and good, but the industry must also work to improve its image.  For some reason the message gets lost that during castrophe’s the industry rapidly pays out billions of dollars in a relatively short period of time without any complaints. Adopting social media and engaging customers will help.

The future seems bright to me and I am looking forward to another year.

What do you think are the key industry issues from 2012 and what needs to be focused on for 2013?

 

Everybody Wants to Make Improvements In Claims But No One Actually Makes It Happen

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It’s Like Selling World Peace. Everyone Is For It But No One Wants To Pay For It

There is so much that needs to be done in the world of claims. Operations need fixing, technology needs improving and a futures need to be defined.  For some reason however, we are all really good at talking about it and not so good about doing anything about it. The industry needs to take action.

We need leaders who will drive the initiatives needed to improve and modernize the claims industry. We are mired in an “it’s always been done that way” mentality and not doing anything about it.  I know the day-to-day is an ever growing series of issues. It is because we are forever being asked to do more with less that action is needed. Strategic planning is a necessary evil and a plan must be put into place to improve the whole or we will be destined to “always do it that way.”

Claims departments need to think creatively and “out-of-the-box” if we are going to attract new talent to the industry. This also means acting and not just talking about acting.

Take Action With These 3 Ideas

So how do you act?  check out these three suggestions for getting out from the wanting to improve to actually taking action:

  • Bring in a consultant for a fresh set of eyes… there is more there than you realize and having someone removed from the day-to-day operation will be like cleaning dirty windows. The clarity will allow you to see both good and bad and will give you the first steps to make improvement.
  • Buy one small application to help fix some aspect of the department. There are plenty of innovative technologies out there to help with everything from adjuster compliance (Xeneros) to claims auditing (the Audit Portal). Try one, they won’t cost too much but they will save you so much in time and expense.
  • Talk to your claims professionals.  Spend a day with a few of the people on the floor and listen to them. Unfortunately many continue to do tasks they know to add little value because they too fall into the “it’s always been that way” frame of mind. I promise you they know more and if given the chance will provide some fairly decent suggestions to improve the operation.  And guess what – this one won’t cost you anything.

How are you going to take action today?

 

 

Why Don’t Claims Organizations Track Claims Through The Process The Way UPS Tracks A Package?

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Shipping Logistics Made Easy

One of the most amazing things to me about the holidays these days is online order tracking for the various shipping companies. What a truly amazing piece of technology.  Recently I bought a present for my son who was accepted into college early decision. I ordered a school sweatshirt and was able to follow it at every step as seen here:

I think we are all used to this kind of precision in the shipping industry.It certainly is in the interests of UPS to know exactly where packages are in the process. Being able to route resources and manage the logistics of a large shipping company require this level of detail. The fact is UPS now advertises that they are in the “logistics” business. At some point someone in the company came up with the idea that the consumer would also benefit from having the same information. The consumer can participate in the process and even re-route the package to a new address while their package is moving through the system.  UPS understood the value to customers in managing their own shipping logistics and changed the way both shippers and receivers look at moving packages around.

Claims Logistics Can Be Easy Too

How many in the claims industry have this kind of detail about their claims in process? And if the claims customer could also track information and participate, how much money could be saved?  If UPS can tell me that a 3 lbs. package has just been moved from one truck to another, why can’t claims departments use similar information about claims to understand and streamline their businesses?

How valuable would it be to truly understand from different aspects of a claim where it is in the process?  Could resources be realigned to deal with small blips in claim volume or severity increases? Would the information help underwriters understand an emerging trend that may cause a need to shift pricing? How efficient could a claims organization be if it could see increases in vendor spends in one part of the country versus another?

How about if an insured could have certain access to the claim in process? Would they be able to assist in their defense more comprehensively? Could they help change the direction of the claim being able to see the path that is being undertaken?

Claims Tracking

Thinking of the claim as a package in transit may be one way to explore new ways to manage files. A claim package comes into the office. It is logged into the system and assigned certain attributes. It is then sent to a staging area where its attributes (shipping information) are analyzed and then it is placed onto the correct truck (claim department/handler) for delivery. Along the way it may have to be redirected for more analysis (various shipping locations) where additional decisions about resources such as experts or further investigation can be made (transfer stations or warehouses).  From there it’s final course can be set and a settlement can be reached (delivery).

I can see taking all the information that is gathered along the way and have it used to understand, not just the single claim, but the entire book of claims. With this information a claims department could shift resources to be more efficient.  Analysis could be done at each step to help improve efficiency and lower costs. Looking at claims through the eyes of other successful industries is a good way to attack old problems.

How do you think claims could benefit if they could be tracked like a UPS package?

5 Must Haves To Consider When Implementing a New Claims System

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Technology is About the People Both Before and After Implementation

I have just returned from the Americas Claims Event held this year in New Orleans. This was a really great conferences that was well run and provided some great learning opportunities.  This year was an interesting mix of speakers and vendors discussing the latest trends.  It was a great place to hear some of the challenges facing the industry and how are those challenges being solved.

One of the most interesting speeches I heard was given by Paul Tuhy, Global Head of Claims for XL Insurance.  Paul spoke about building effective claims systems and processes and gave some valuable suggestions on how to implement claims projects successfully.  Paul began his speech by going through a bit of history surrounding claims technology from the punch card days to the paperless office. It was a great way to set up how to develop a platform that “flows” with the claims staff.

I believe strongly that claims systems should assist claim handlers in making better decisions and not necessarily be expected to make those decisions for them. In the end, the claims technology must serve claims professionals. This is what Paul Tuhy and XL have been trying to achieve with their technology offerings. Developing a new claims system can be fraught with many challenges, regardless, there are some great ways to make that process better (see Putting Puzzle Pieces Together and the Challenge of Creating a New Claims System and The Legacy Claims System Facelift – 5 Issues To Consider When Looking At New Systems).

5 Ways For a Successful Implementation

Paul Tuhy made the following suggestions to manage development:

  1. Use the best and the brightest on the project: A new IT project for claims cannot be a dumping ground to stick poor performers.  Paul suggests the process should hurt a little and that means taking some of your best claim handlers off their desks to act as the subject matter experts. These experts must be able to think strategically and have a broad perspective in order to assist in what will be a major change for much of the organization.
  2. Consult the business: Don’t build a claims system in a silo. This is a business system and not just a claims system.  Involving the underwriters and actuaries in the process will help to implement an enterprise wide solution to improve the overall business outcome and not just make claims handling easier.
  3. Dedicated executive sponsorship: A project this large and this important needs an executive champion. There must be the ability to help move the project forward and ensure deadlines are met at an executive level or the development may stall.  This will require a large time commitment, however, this commitment will be rewarded with a streamlined approach and the ability for decisions to be made effectively.
  4. Project management: The project team must have passion to move the project forward with a tireless dedication. The team must have the same vision as the leadership to maintain the focus through a long implementation.
  5. Scope creep: The system and suggested changes must have value. It is very easy to sit back and add a piece here and another there.  Prior to making a change to the project a cost benefit analysis must be done.  It is a difficult thing to measure, however, and sometimes system enhancements will begin slow and don’t show their value for several months or years.  Measure those changes after the fact and see if the perceived value actually came to be.

As companies continue to invest money in new technology it is important that those investments do not end up creating more problems.  Claims technology can be a great way to improve efficiencies and lower costs when done correctly.  Too many times projects fail because the up-front time and investments were not made.

How do you help your IT projects succeed?

Looking Back On 2010 And Forward To 2011 In The World Of Claims

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Pop The Cork And Say Goodbye To 2010 And Look For A Brighter Future Ahead

I for one am glad 2010 is coming to a close. It’s been a tough year and just when you thought things wouldn’t get worse they did anyway.  Regardless, there is much to be thankful for including joyous family events, health and happiness.

Thanks For A Great First Year

I am so very proud of, and thankful to, the readers of the Claims SPOT for making our inaugural year so successful. Since our inception in January of 2010, we have been read in all 50 states and in over 100 countries. Our over 13,000 visitors to the site have looked at nearly 24,000 pages of 81 posts over they past year. The Claims SPOT received national recognition as the featured blog for Claims Magazine and was voted one of the top insurance blogs by Lexis/Nexis.  Thanks again to all who commented on our posts and helped to keep the discussion lively. We very much look forward to providing information that can truly help the world of claims in the coming year.

The year began with continued economic concerns, a poor job market and no recovery in sight. It has come to a close with a booming stock market, improved job numbers and a better outlook for 2011 (for the top ten insurance stories of 2010 check out National Underwriter’s). Looking back on the year in claims and looking ahead to the future of claims is always a fun exercise this time of year so here we go!

Staffing Crunches, Cut Backs And “The” Oil Spill

Global Recession and Staff Reductions. As with many businesses, the insurance industry was not immune to the economic crisis that began in earnest at the end of 2008 and continued so strongly in 2010.  Many claims departments cut back on professional and support staff as yet another victim of the recession. The “we need to do more with less” mentality seemed to dominate the landscape leaving claim managers scrambling to keep up with the normal pressures in claims.  More work for claims professionals meant relying more heavily on adjusters and attorneys to take on additional work increasing claim expense costs.  Trying to improve operations and take on projects to enhance the claims department needed took a back seat to the realities of the day’s needs. All this with a looming claims staffing crisis and decreasing talent pool in the industry (McKinsey study).

Deepwater Horizon. Really not much more needs to be said about this one. The tragedy surrounding the largest oil spill in US history dominated the headlines for much of the year. As we reported in June, the impact on claims will be extensive and even to this day have yet to be fully realized. What struck me as the most concerning was the public outcry that claims were not being paid quickly enough. As big a tragedy as this was, public pressure cannot create an environment for poor claims handling. Fraud and overpayment of claims will only result in increased premiums over time and will do nothing to help the consumers and those in need of compensation. I applaud the statement made by Kenneth Feinberg, head of the government led claims fund,  about paying “legitimate” claims. We in the industry must be reminded in CAT loss situations how important it is to pay those fair claims promptly, but to not just pay for the sake of paying (Leader on BP claims blames fraud for slow payouts).

Interestingly, despite no major hurricane hitting landfall this year, 2010 proved to be an active year for CAT losses worldwide (see Worldwide Insured Cat Losses Nearly Double In 2010).

Enough Of The Past, It’s Time To Look Forward

With the hope and belief that things are looking up this coming 2011 (2010 Now On Target To Be A Profitable Year For P&C Insurers), it is time for the claims industry to get back to work on improving their overall operations. Here at the Claims SPOT we are never shy about giving our two cents so here is what we feel are three key issues to be addressed in 2011:

Compliance Audits: Let’s face it – one of the reasons that the economic meltdown occurred was due to a lack of internal controls and compliance. Whether it has already happened, or is being considered, further regulation of the insurance industry is a certainty.  As a result it will require further diligence on claims departments to ensure claims are being appropriately managed and reserve and settlements that are put forth are accurate reflections of losses. Having the controls in place will not be enough. While it may sound silly, it will be important to have controls over the controls. What this means is it will not be enough to just perform an audit from time to time. Guidelines as to when and how those audits are done will be necessary to demonstrate to governing bodies that procedures exist and are being followed.

Whether you are a reinsurance company reviewing Cedent’s claims, a claims department looking at best practices, an excess carrier reviewing a primary carrier’s losses or the paper behind a MGA managed program, having a proper audit program in place will be a key element going forward.

Next Generation of Claims Professionals: We hear it again and again that the industry will be in crisis if they do not begin to address talent being attracted to claims. As the industry has matured, specialization has resulted in cost savings and better claim results. The same specialization has also contributed to stagnating the profession.  As the older generation of talent begins to leave claims departments, the cross-disciplined experience in claims is disappearing. This will need to be addressed if the talent needed for the next decade will be ready to handle even more complex claims.

Technology and Claims:  Used correctly it can save an organization tremendous amounts of time and money, used incorrectly it will cost it more.  While there is still a long way to go, and it still amazes me to learn how far behind many major claims organizations are, the use of technology in claims has been improving. Unfortunately many groups fail to grasp what these systems can do. Either they spend too much money to buy a system not designed for their organization, or they fail to adopt their process to the new technology, failure becomes inevitable.

For 2011 adopting new technology that can help claim professionals be claim professionals and not just create more work will be the imperative. Using the mountains of data contained in the modern claims system to help make better decisions, and assist the rest of the organization to benefit from the claims data, will be the wave of the future. Regardless, it will be important to know what you are, know what you need, be selective, and implement correctly to get the benefits that new technology can bring to an organization.

Of course there are more trends from the past and future. Tell us what you think the future will bring!

Claims And The Investigative Journalist And Learning From All The President’s Men

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Digging for the accurate story is a claims person’s goal

The other day I was watching All The President’s Men, the story of Bob Woodward and Carl Bernstein, The Washington Post reporters who broke the Watergate scandal wide open.  If you have not seen the film then please accept this as my “two thumbs up.”

What does this have to do with claims you may ask? Keep reading and you will see.

Woodward and Bernstein were investigative journalists. Their job was to uncover facts that would lead to other facts that would lead to a supported conclusion. There was a lot at stake for the Washington Post if the story was wrong, and even more at stake for the country if the story was right. The process was well laid out in the movie with the two journalists following one lead to another and researching and following up to support their eventual conclusion.  Given what was at stake, the Publisher made it clear to the two reporters that there was no story if it was only supported by innuendos and accusations and no proof. Once the support was there, the story ran and the rest is history.

Sounds a lot like a claim file to me.

It is the claims professionals responsibility to figure out what happened and then come to a supported conclusion when evaluating and settling a claim. As there was for the Washington Post, there is a lot at stake for an insured, a claimant and a company if decisions are made in haste. Getting the conclusion right or wrong can have significant financial consequences for all parties involved. Prior to spending money on claims, good claims practices dictate that there is support for the decisions to settle and pay claims. Being a claim professional is a lot like being an investigative journalist. Figuring out what happened and why is critical to making the appropriate assessment.

Technology has really helped those investigations

Unlike Woodward and Bernstein back in the early 1970’s, claims professionals have a tremendous amount of technology available to them to help figure out claims problems.  There are two great scenes in the movie that truly reflect how times have changed when it comes to conducting even basic investigations. Back in the day, even simple tasks, that we all take for granted today,  would have taken hours and multiple resources to complete.

In the movies, the reporters found a name on a check and had no idea who the person was or how to contact them. Imagine that issue today – no big deal – go online, plug in the name to Google, and presto a list of information including addresses, phone numbers, job descriptions and maybe even photographs appears in seconds.  Not back in 1973 where Bob Woodward (played by Robert Redford) is seen sitting in a room with phone books from all over the country looking for a name. Another staff person comes into the room and was able to find a photograph in what was called the “clip file.”  I can only imagine how long that took and how many resources were needed to find the photograph alone.

In another iconic scene from the film, the two reporters needed to find out what books had been taken out by a White House staff member from the Library of Congress. The two were handed boxes and boxes of slips of paper used to document the check out of books from the library. In a great piece of film making, there is an overhead camera angle of the two reporters going through every slip of paper in what would have taken hours if not days. Of course, they never found what they were looking for. Today the same task would have taken seconds.

Think about the tasks you do as a claims professional and try and imagine not being able to use even basic technology to find a name or locate a witness.

Just remember, technology isn’t everything in claims

I have always been a big proponent of good systems to enhance a claims professional’s ability to get their job done. Regardless,  claims technology should allow the claim handler to be a claim handler and free them to be more analytical and less ministerial. Unfortunately, technology has often brought more work with little relief. As more claims can be processed faster, there has been a greater emphasis on dotting I’s and crossing T’s and less on outcomes.  While it is important to accept tremendous efficiencies technology has brought to the claims process, do not forget that the true art and skill of claims is in the ability of a claims professional to analyze the information and make an appropriate decision.

Tell us your investigative journalist claims story

You Can’t Wait Till The Last Minute To Improve You Operation – Planning Starts Now!

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Don’t let the lily pads take over the pond.  The time to deal with the problem is now.

I had the pleasure of recently attending an executive summit presented by ACS A Xerox Company in Hartford Connecticut. The conference theme was centered on insurance issues and looking forward to 2015.  It was a great meeting with executives from a variety of insurance companies and industries.

Looking to the future is a difficult task, especially when day-to-day issues make it hard to stop and be strategic. Unfortunately, trying to plan for the future takes time, and thinking it can be put off will only create larger problems.

Before you know it that little issue will grow into a big one – the lily pad problem

James Hatherly, one of the guest speakers at the conference, gave a great analogy about putting off minor issues. James is the author of Daring to Be Different, A Manager’s Ascent To Leadership and he discussed the importance of having to think about problems sooner rather than later with the following story:

One morning a farmer observed that a lily pad had sprung up on his pond. The following day there were two lily pads, and on the third day there were four. Since they did not seem to be doing any harm he took no action. However, the number of lily pads continued to double every day until the pond was completely covered on the thirtieth day.

James questioned the audience as to how long did it take for the pond to be covered 50%? Or even 25%? The answer was that the pond was 50% covered on the 29th day and 25% covered on the 28th day.

His point? Managers and executives can’t wait until the 29th day to solve problems.

With time slipping away, what should claims departments be thinking about in the next 5 years? That question, of course,  will be answered differently from company to company. Regardless, there have been certain trends that exist today, being addressed by other industries, which should be looked at in today’s modern claims department.

Two suggestions for beating the lily pads to the pond

There is nothing too forward thinking about the concepts I address here. There are plenty of cases in the insurance industry where solutions have been adopted successfully. Nonetheless, if you have not addressed either of these because you felt it was not appropriate for your organization it may be time to reconsider and see how they may apply in the future.

  • Social Media – I know it’s the buzzword in business wherever you go. You are probably aware of the powers of social media or you would likely not be reading this blog. Twitter, LinkedIn, Facebook and a variety of other services are being incorporated into businesses more and more each day. How will the insurance industry, and more specifically claims, adopt these outlets? Will you use Twitter to tweet claims alerts to customers? Are you creating a Facebook fan page to learn more about, and solve customer problems?  How about an internal social network to share claims information amongst departments and partner organizations. How can these applications make your claims department more efficient?
  • Mobile Technology – Everyone has a phone that can handle such an array of tasks that it’s amazing we ever functioned without them. Better bandwidth, and more coverage, allows access to an amazing amount of information from the palm of your hand. What is your company doing to adopt this technology? Are your claims adjusters able to assess claims on the road and instantly pass the information into systems for analysis? Are customers able to file a claim from their phone attaching photographs and other information like GPS locations?  Will new devices, such as an iPad be used in the future claims organization? How will your organization respond to these devices? Lead or follow?

Like most industries, adopting and changing with the times can be a difficult proposition. It takes time to think of issues, come up with solutions and implement the changes. Insurance companies have added legal, compliance and regulatory concerns, to say nothing of complex, and sometimes outdated, information technology systems.  Regardless, it’s not too late to address issues to create a social media or mobile strategy.

Think back five years and ask yourself how many lily pads would be on the pond had you stopped to deal with the first one on day one. The trends we see in technology, and in how people work around the world, are changing rapidly. To stay ahead of the curve, and take advantage of solutions that can help your organization, start thinking out-of-the-box now. Take a lesson from an article I wrote a few posts ago about changing hats outside your industry and see how others are adopting their operations to the changing times.

Now is the time to consider change. Before the pond gets too filled with lily pads attack the problem and look for solutions. Five years from now – you won’t be wondering what could have been.

What kind of lily pad can you see on the pond that can be dealt with today?

New Claims Technologies To Help Companies Drive Revenue And Differentiate Themselves

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Still Working With Files? Time To Reevaluate Your Technology

New Study By The Gartner Group Shows 10 Technologies With The Greatest Impact For The Property/ Casualty Industry To Drive Revenue

The Gartner Group, Inc., in a new report, has identified 10 technologies that they feel will have the greatest impact for the Property and Casualty industry to help differentiate themselves and drive new revenue.

“There is a long list of technologies that P&C insurers can use to improve their processes — from product development through customer service. Many of these technologies, however, provide only incremental or minor improvements, have limited or no return on investment (ROI), or do not promise to help P&C insurers radically change their business models, reduce operational costs or generate revenue,” said Kimberly Harris-Ferrante, vice president and distinguished analyst at Gartner. “With budgets challenged and with limited funding for discretionary spending, it is imperative that organizations prioritize their investments favoring those that will generate the greatest ROI and drive the most value.”

Many of the technologies suggested by Gartner can have a significant claims impact. Below I comment on 4 that I feel can have the greatest impact on claims:

  1. Modern Policy and Claims Management Systems – Companies with modern systems, that integrate well with the rest of the organization, have enhanced workflow and business process management (BPM) capabilities. Such systems are easily adoptable as business changes occur and give the company a clear competitive advantage. As Gartner points out, “the adoption of these systems by personal and commercial P&C insurers can provide significant value, including reducing the total cost of ownership, when legacy systems are decommissioned.
  2. Business Intelligence and Analytics – Data and analytics are a logical extension following the adoption of updated systems. Customers are demanding more information and can easily be provided what they need with newer analytic tools. Having better information will also lead to better risk decisions and pricing. In addition, as more states require specialized claim reports, these types of analytics are required to ensure compliance with ever changing data requests.
  3. Advanced Fraud Detection Solutions – Gartner put it best on this one by saying “it is key that insurers reduce losses and leakage to retain profitability. Better control of fraud is essential in accomplishing these goals. Advanced tools analyze data (structured and unstructured) to identify fraudulent claims in real time at point of data entry. This will assist P&C insurers in reducing losses that result in driving up operational costs and may result in companies having to increase insurance premiums based on these losses”
  4. Mobile Devices/Technologies – Any way a consumer can submit a claim promptly and easily will be an invaluable tool. The buzz word in business is mobility and it is no different with claims. With most mobile devices now containing cameras, documenting losses early in the process is easier and can assist in preventing fraud. From the adjuster side, stronger, integrated, mobile technology will greatly speed up claims processing significantly reducing costs.

Failing to adopt new technology will put companies at a competitive disadvantage. Every company should look to evaluate their current systems and offerings and create a strategic plan to keep up-to-date with software and solutions. Staying ahead of the curve is a sure way to help drive costs down and stand out from those who don’t.

Prior to going down a new technology road, I would again encourage an assessment of your claims operations. For further comments on how to manage new technology, please see my prior posts of Putting Puzzle Pieces Together and the Challenge of Creating a New Claims System, as well as With old claims systems come old claims processes – You can’t change one without the other!

What trends are you seeing in claims technology that will be essential for companies in the coming years?

Blizzard Warning in the East! Can your claims department keep running if the office closes?

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The snow storm hitting the East Coast is a great reminder to be prepared

Today much of the East Coast is under a blizzard warning. Yesterday, in anticipation of the storm many cities took preemptive measures to be prepared by closing schools, readying plows and salt trucks, and changing parking regulations. Airlines and other business took similar measures to ensure the safety of workers.  All of this activity reminded me about something that is often overlooked – claims departments also need to be able to handle their own offices being closed due to natural or other events.

Major disasters are not always the reason why you need a disaster recovery plan. The claims department should have a plan to manage situations where their office is unexpectedly closed, unavailable, or no longer usable. Whether it’s a snow storm or a burst pipe that floods the office, being prepared for the predictable or unpredictable events is important. And, like changing your batteries in smoke detectors when the clocks change, disaster plans should be reviewed regularly.

Is your office ready for the unexpected?

In my career disaster plans had to be initiated on 2 occasions (9-11 and the East Coast blackout of 2002) and I was also heavily involved in pandemic planning for the Avian flu scare. In all of these situations our claims department was ready. We were prepared because of planning and our technology. Our claims system and claims files were all electronic, off-site and accessible an remotely. Remote access was a key component to managing any kind of contingency where an office has to be closed.  This ability to continue to manage claims when others have to close is a competitive advantage in the marketplace.

Are you ready for the next incident that shuts down your office? Ask yourself these questions:

  • Do we have a disaster and recovery plan in place?
  • When was the last time we reviewed our plan?
  • If we had to close for more than one day could we still manage claims? What about a week or more?
  • How many of our claims staff can access the system from home?
  • How much information is available electronically?
  • De we have paper claim files or do we store them electronically?
  • Do we store our files locally or off-site?
  • Do we have back-up data? Do we store our back-up data off-site?

Being prepared for the larger disaster, and having the technology in place, means that closing an office for a snow storm or other event won’t affect the regular management of claims.