Needham, Mass. – Leaders in claims operations are beginning to break away from traditional processes and seek technology to assist them in managing a complex business process that has, to date, been extremely people intensive, according to new research from TowerGroup, Needham, Mass. Claims departments have been historically reluctant to adopt technology solutions, perceiving technology as incapable of duplicating the decision-making process of an experienced claims adjuster.
The research finds that although some claims executives have driven a new vision into their operations, most claims organizations still struggle to strike a balance between adopting new technology and maintaining an intimate connection with their customers, agents and brokers. The pursuit of competitive advantage and ever-increasing consumer expectations requires service points to be frictionless and seamless.
Yet, the claims process is also being impacted by the loss of expertise due to the retirement of claims adjusters from the baby boomer generation. The loss of these adjusters will increasingly threaten the claims capabilities of many carriers over the next 10 years, intensifying the drive to more effectively leverage technology, according to the research.
TowerGroup believes the greatest benefit of technology to P&C claims operations will be automated information support for decisioning rather than the full automation of processes. The right technology, including incorporation of predictive analytics, will enable claims adjusters to achieve a new and superior level in the claims service experience.
Karen Pauli, a senior analyst in the TowerGroup Insurance practice, authored the report “Technology Direction in US P&C Insurance Claims Operations: Transforming a People Business.” The research finds that leaders in the claims business are moving toward a new set of imperatives that will provide the granular management needed in today's complex business environment.
Pauli concludes that carriers need to take this step toward modernization, leaving behind traditions that will limit their future growth.
“Carriers must have a system that can address the business drivers impacting claims operations,” the report states. “Buying technology only for compliance purposes and operational tasks will limit a carrier and result in competitive disadvantage that will eventually threaten the carrier's existence.”
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