In the U.S. P&C industry, claims processes remain fundamentally inefficient and there is a $36 billion opportunity to reduce claims-loss costs and expenses, according to “10 Startups Transforming P&C Claims: A US$36 Billion Opportunity,” a report from Aite Group.
“Claims operations are still extremely labor-intensive, heavily paper-based, and data-rich but information-poor,” said Stephen Applebaum, author and senior analyst at Aite Group in the report. “As visionary P&C insurers reinvent themselves around newly emerging operating models that involve customer-centricity as an enterprise-wide design paradigm, this outdated view of claims is changing.”
In addition to describing opportunities to reduce claims costs, the paper profiles 10 companies attempting to address portions of the claims improvement opportunity, points of differentiation and growth expectations.
“Smaller P&C carriers should leverage new and innovative claims solutions far more than they currently do,” Applebaum said. “This will eliminate disadvantages of scale, allowing smaller carriers to compete on a more equal footing with top-tier carriers by reducing claims leakage, cost per claim, and cycle time and by increasing cost-effective customer service, underwriting accuracy, and profitability.”
Highlights from the report:
New property and contents solutions. New applications for homeowners, commercial properties and contents claims are beginning to transform work flow, documentation and valuation capabilities, which could boost customer satisfaction through faster, easier and more accurate claims resolution, as well as improved catastrophe claims response times, Applebaum said. Companies innovating in that space include BuildFax, EagleView, Enservio and Symbility.
Open-market electronic parts procurement solutions. Improving auto physical damage claims outcomes could result in higher customer satisfaction and retention through shorter repair cycle times and better transparency into repair management, Applebaum said. Companies innovating in that space include PartsTrader.
Liberate static claims information through digitization. Insurers should feed available claims information into analytics software to generate claims and underwriting insights. Companies innovating in that space include n2uitive.
Driving out fraud, duplicated and inflated medical injury costs in auto and workers' compensation. Applications such as ICEX, can help identify pre-existing medical treatments; Social Intelligence, which can revealing claimant information and facilitate investigations through social media exchanges; and SynerScope, which helps identify fraudulent claims and networks through data visualization, Applebaum said.
Negotiation of personal injury and property claims and outcomes. Deploying applications for determining comparative negligence could replace inaccurate, uneven and labor intensive processes. Companies innovating in that space include Casentric.
