What auto claims will look like in three years

The claims experience will become increasingly automated over the next three years, as many customers are handling their claims virtually – and this will impact insurance professionals’ daily work, a recent LexisNexis report predicts.  

LexisNexis Risk Solutions 2025 Claims Prediction includes forecasts for 2025 and notably states that the auto direct repair industry will see a significant change in how claims are processed, thanks to the shift towards digital transformation by many carriers.  

This report builds upon predictions from 2021, where LexisNexis found that:

• Virtual claims handling continued to grow in popularity with consumers
• Carriers influenced consumer attitudes toward automated claims processing by accelerating technology adoption
• Consumer satisfaction with their claims experience declined slightly.

“In monitoring these trends throughout the year, the predictions we made are on track and appear to be aligned with what we’re seeing in the industry. For 2022, we’re ready to build on last year’s predictions and focus on some specific areas that will impact insurance professionals’ daily work,” the report reads. 

According to the report, the 2022 predictions go as follows:

• AI + Virtual Estimating will spark a redesign of traditional auto direct repair programs.  
• Consumer preference for self-service will convert traditional call centers into quick claims resolutions centers.  
• Re-engineering the total loss process with real-time data will create an experience like buying and selling cars from your computer, but for total loss claims processing. 

The primary prediction involves the auto direct repair model, where LexisNexis projects that the current model will become increasingly automated through AI technology by 2025.  

“I predict that the [direct repair process] DRP of the future will leverage more AI self-service capabilities to simplify the workflow for body shops and the DRP claims staff,” writes Bill Brower, vice president of claims at LexisNexis in the report. “Rather than a consumer calling a call center, and the call center transferring the claim to a DRP shop, consumers can report claims digitally from an app.” 

This will allow DRP claims professionals to support more DRP shops and reduce administrative work for both parties, “which will further improve the customer experience,” the report reads.  

The next prediction follows up from the 2021 prediction that half of non-injury First Notice of Loss (FNOLs) will be reported via self-service or telematics solutions by 2025. 

“As insurers provide more “Amazon-like” self-service FNOL options, it will be important for call center operations to transform to quick claims resolution centers,” writes Brower. “By 2025, I expect to see about half the staff in most insurance claims call centers still overseeing traditional FNOL phone reports and the other half being up-skilled to bring low-complex claims to same-day resolution.” 

This will include AI damage assessments for both auto and home claims, as well as chat and text support service for individuals who report claims digitally, which in turn will “result [in] a more customer-friendly claims process,” the report reads.  

LexisNexis predicts this will continue to trend upward over the next three years and allow carriers to adjust to the self-service preferences of customers.  

The final prediction says virtual inspections, and the availability of real-time data on titling, vehicle equipment, fees and payoff, will allow carriers to “re-engineer” the total loss process.  

The typical total loss claims process required adjusters to hunt for title information, spend time on the phone seeking payoff information and go to local websites to determine the fees and taxes owed. LexisNexis predicts this process will speed up. 

While the total loss process is typically rated as the lowest customer service score by claims departments, Brower writes “it is increasingly possible to settle a total loss claim within hours, versus weeks, as is common today.” 

What to make of these predictions? Brower writes that by leveraging technology and data to improve the claims process, “claims employees will experience increased job satisfaction, and carrier customers will benefit from a greater and more streamlined claims customer experience.” 

 

Feature image by iStock.com/ipopba