Auto Rental Replacement: A Tech Boost

Introduced in Canada in 2000, automated rental car systems changed the way insurers and rental car companies do business. The new technology promised to cut costs and boost customer service and has done so quite successfully. Now, four years later, innovations in technology have helped the replacement rental process evolve into a sophisticated relationship between the insured or claimant, the insurer, the rental car company and the collision repair center.

It is no secret that by facilitating communication between the insurer and the collision repair center, replacement vehicle management systems have saved the insurance industry time and money by increasing the level of control an adjuster has over the repair cycle.

Time spent by claims adjusters tracking down mechanics and securing updates on the status of their clients’ vehicle repairs has been drastically reduced. Collision repair centers can now update client files online at regular intervals, allowing the adjuster to keep track of the repair status in real time. Today, instead of spending hours returning an average of 10 phone calls per claim to secure repair status, adjusters can dedicate their time to responding to customer needs.

Cutting down on phone calls eliminates lag time between when repairs are completed and the rental car returned. As a result, insurers are experiencing incremental savings by reducing the length of the average rental period and getting customers back in their own cars. While the average reduction in the rental period seems minimal at an average of 0.7 days per claim, the true savings are realized when this number is multiplied by the thousands of claims per year.

GAINING EFFICIENCY

Prior to the introduction of early versions of claims technology, the rental process, including phone calls and paperwork, was cumbersome. Today, an adjuster can manage the entire process – from reserving the appropriate replacement vehicle, to generating an invoice – from their workstation.

More than 90% of North American insurance companies are now using some form of claims technology to manage their replacement vehicle rentals. In the first years following the introduction of claims technology, savings for the insurance industry were estimated at more than $146 million. Today, replacement vehicle management systems are so ingrained in the day-to-day operations of the average adjuster that they are viewed as an industry standard application.

Furthermore, Internet-enabled technology has allowed the use of replacement vehicle management systems to become available to all insurers. The latest systems are accessible online and managed by the technical support team of the rental car company. All that is required is an Internet connection.

DATA INTEGRITY

“Maintaining the integrity of the data and ensuring it is secure is a top priority for online business tools in any industry,”says Dave Smith, assistant vice president of Internet solutions at Enterprise Rent-A-Car. “Given the sensitive nature of insurance claims, we are aware that it is a requirement for our application to incorporate the best firewalls and security systems available to protect the integrity of the data.”

By hosting the replacement vehicle rental information off-site, there is no risk of corrupting in-house data management systems. The user has complete control over the data collection and updating process, including what, how much and when it is downloaded. Customized reports that reflect real-time status on repairs and rental vehicle costs are quickly and easily incorporated into an insurer’s proprietary data management system.

Customized features and functions based on policy information, provincial regulations and client agreements can all be incorporated into the program structure.

MAXIMIZING RESULTS

Despite the advanced features employed in most claims technology systems, some functions still exist where insurers can take their usage one step further to ensure they are employing the technology in its fullest capacity:

Integration. The primary goal of claims technology is to achieve a seamless relationship between the insurer’s in-house claims management system, the rental car company’s reservation and rental management database and the collision repair center’s database.

Invoicing. By delivering electronic invoices directly to the insurer’s payment system, current claims technology can be programmed to issue payment by electronic funds transfer.

Reporting. Traditionally, reports would be generated for rental agreements arranged through the claims technology application. Today, reports can be generated to show all vehicle rental agreements, open or closed, whether they were created using the automated rental management system or not. This allows for improved cost control by adjusters and provides a real-time overview of claims status.

It is in the best interest of rental car companies to develop comprehensive claims technology and focus on continually improving replacement vehicle management systems for insurers. By doing so, all parties engaged in the auto repair and replacement process benefit from a cost and time effective solution that also reduces the inconvenience of an insured in being without their own vehicle.