Ten Technology Trends To Boost Claims Automation

Today, with most financial services transactions occurring in real time, the claims industry has had to respond to consumer and market pressures to automate and accelerate claims processing. Using Internet- native platforms, claims adjusters can streamline traditional claims inefficiencies and reduce manual, paper-based processes, which have long contributed to high claims costs and overhead expenses. Internet technology has the ability to tightly integrate data, systems, and people to speed up workflow, improve productivity, and enhance claims decisions. Ten technological strategies driving automation, cost savings, and success are:

1 Browser revolution

Many insurers are hampered by legacy systems that lack contemporary automation capabilities and result in inefficient operations. These systems are highly resistant to change, inter-connection with other systems, and access by external parties, such as claims adjusters, specialized loss-control experts, and customers.

Recognizing that today’s claims process must extend beyond the four walls of the company, insurers are leveraging a more modern infrastructure. Browser-based technology has become a means to rapid transformation, enabling insurers to capitalize on remote operations that increase the scope of business, staffing, and service opportunities. For instance, browser-based technology affords claims professionals greater freedom and mobility, allowing them to log on remotely from a satellite office, the road, or even from home.

As the name suggests, browser-based technology requires only an Internet browser to run — a standard application on any computer. This Internet-native software operates with greater speed, reliability and performance than client-server software that must utilize middleware to run online. At the crux of browser-based benefits is the broad spectrum of access these systems offer. Virtually an unlimited number of users can connect using world-class security standards.

2 Innovations in claims reporting

Prompt and accurate reporting of claims is the cornerstone to achieving best-possible outcomes. When an insurer employs a call center, data captured on the front-end can feed directly into a back-end claims system via Internet connectivity. This seamless integration enables adjusters, nurse case managers, and other loss-control specialists to quickly initiate their role in the claims process, leading to optimal costs and outcomes.

With the advent of intelligent online claim forms, the use of Internet reporting is dramatically increasing. These smart forms use drop-down lists, auto-populated fields and threads of logic to navigate users quickly through the electronic claims submission process. Due to its intuitive, user-friendly design, online forms are faster than a typical phone transaction. Beyond speed, these web-based transactions provide insurers with significant cost savings. Using a call center, the injury reporting process costs an average $16 per claim, but web-based reporting can reduce the cost to $3 per claim.

3 Paperless processing through a data-driven strategy

Today, the vision of paperless claims processing is finally being realized. In its rudimentary stage, insurers scanned documents but continued to use paper to exchange information via fax and mail, as well as to store proper documentation.

To engage in a truly paperless paradigm, organizations are avoiding the generation of paper documents, relying on the electronic submission and exchange of information. In this data-driven environment, information is input once and made available to all parties via a browser-based electronic infrastructure that spans the entire enterprise.

The paperless paradigm has continued to expand as organizations incorporate optical character recognition (OCR) and attach digital photos, videos, and audio to the electronic claims file — accessible to all authorized claims professionals via the browser-based platform. This data-driven strategy means claims information is available for real-time analysis, benchmarking, and performance reports.

4 Business rules automation enables straight-through processing

Ideally, insurance companies want to apply adjuster resources where they are needed most. By leveraging business rule engines, organizations increase their rate of straight-through processing. To achieve this type of end-to-end automation, organizations customize business rules to review incoming claims and identify the “simple, straightforward” transactions to be routed for immediate settlement and closure with little or no human intervention. Business rules ensure consistent quality in an automated claims-handling environment, while also enabling claims adjusters to focus their time and attention on more complex claims that require their expertise.

5 Adjusters’ automation toolkit

Adjuster can utilize automation tools — such as automated forms, sophisticated diary systems, scheduling tools, streamlined communication, and “smart” prioritization of tasks — to help coordinate routine administrative functions, saving as much as 20 per cent in adjuster time and resources. Advanced automation enables adjusters to focus on the tasks that directly impact costs and outcomes. Within this toolkit, letter-writing and form-generation templates automatically produce documents with fields auto-populated from the claims database. Adjusters simply review, edit and send the documents, which saves time and automatically creates proper documentation within the claim file.

6 Claim email

These days email has become a standard mode of business communication. In the past, adjusters had to toggle between their claims system and an external email program to send claim-related email communication. Any important correspondence then had to be copied and pasted back into the claim file for documentation. With the latest Internet technology, email is seamlessly integrated. From the claim file, adjusters send and receive email to streamline communication, and it is automatically stored at the claims-level. This integrated claim email works much like Outlook, and adjusters have the capability to easily attach items internal to the claims system, such as a scanned document or other forms.

7 Hyperlink technology

Today, online consumers are accustomed to the use of hyperlinks in e-commerce transactions. They may make online airline reservations and receive an email with a hyperlink to review their travel itinerary. The hyperlink allows the passenger to select and reserve a seat, and in some cases, specify meal preferences. The information is updated in the airline’s master database, saving the company time, money, and resources, not to mention the speed-to-service enhances customer satisfaction.

Hyperlink technology is also being used to streamline claims workflow. Within the claims industry, a “guest link” is basically a hyperlink sent via email and allows an external user or “guest” to directly access a specific claim. The hyperlink is secure, and access rights are defined by the sender (usually the adjuster) as either “view only” or to allow the guest to add information directly to the claim and have it updated in real time. The guest link provides insurers with transactional costs savings and has cut back on bottlenecks in exchanging information, such as waiting for returned calls or faxing paper files to other stakeholders.

8 Quality control through online audits

Every year, the claims industry spends billions of dollars in inefficiency, overpayment and waste. Insurers have a huge interest in reducing waste by tightly managing claims-handling quality and consistency. Insurers traditionally audit claims operations to ensure best practices are performed regularly. Because audits are time-consuming, they were typically performed only on a retrospective sampling of 10 to 20 per cent of claims.

Today, online auditing has allowed the process to bec ome more electronic and transparent. Insurers now perform real-time concurrent reviews of 100 per cent of claims, enabling them to ensure a higher level of claims-handling performance. Audit findings allow claims managers and adjusters to fine-tune operations, achieve a tighter lifecycle, and ensure cost-containment at key junctures of the claims process.

9 Unleashing the power of claims data

With technology, insurers have gathered a sizable amount of claims data. Using browser-based technology, this information can now be “sliced and diced” with powerful data analysis and reporting capabilities electronically. For example, claims adjusters can now customize reports and automatically distribute them to various stakeholders. This has helped to enable enterprise-wide monitoring of key performance measures. With timely claims intelligence, adjusters are empowered to make faster, more accurate claims decisions. With web-based capabilities, customers can also log on to access these reports to stay abreast of their claims experience and react more nimbly to control future losses.

10 Web Services

The Internet is increasingly being used for application-to- application communication. Web services, component-like applications that run on the web, have the capability to describe their functions and services to one another online. They automatically link together without the traditional challenges involved in system integration. The modular and interoperable nature of these applications enables insurers to enhance the functionality of their existing claims systems. For instance, insurers may integrate a new web services module to more accurately assess reserves. Through a browser-based platform, the possibilities to increase features and functions are numerous. By becoming more aware of this trend, adjusters are not only benefiting from new capabilities, but also suggesting new functionality, which can be quickly integrated into core claims systems.

Continual claims innovation

The insurance industry must continually focus on improving the claims operation. Today, Internet innovation is a main means to process transformation. The ten Internet tools discussed here are making it easier to accommodate the increasing complexity of claim transactions, which involve multiple parties, multiple systems, and various regulatory concerns. As early adopters have found, the more complex and cumbersome the transaction, the greater the opportunity for the Internet to provide efficiency, cost savings, and the ability to build better service their clients.

Randy Wheeler is the managing director of Aon eSolutions.