Wipro and Livegenic (a firm that provides enterprise technology services and a virtual collaboration platform for insurance), together hosted a Fireside Chat on why digital claims management is critical to the operations of any insurance company. The panel led by Edward Kenny—Director of Customer Success/Account Management at Livegenic, Soumya Ranjan Dash—Ex-General Manager, Global Insurance Delivery at Wipro, Troy Jenson—Property and APD Manager at Bear River Mutual, and Dennis Ingersoll—Director of Claims at Allianz, explored how insurance companies can empower themselves to deliver personalized, swift, and virtual claims support to their customers. This article is summary of the discussion. To view the fireside chat,please click here
Property claims in the US are on the rise due to more frequent severe weather events, changes in construction methods, and fraudulent claims among other reasons. A research from the Insurance Information Institute (III) outlined that 6% of insured homes in America had a claim in 2020, and 97% of all homeowners insurance claims were property damage claims. However, the types of property damage varied. Wind and hail (34.1%), water damage and freezing (28.7%), and fire and lightning (26%) accounted for the most claims. Theft (1.8%) and classified as other (5.7%) contributed to the fewest claims. These percentages vary yearly due to the frequency and severity of weather-related events like hurricanes and winter storms.
Another significant influence is US consumers and their expectations for claims service. A grasp of both opens the door to streamlining claims processing and improving the overall service to the insured. This reason is enough for insurers to simplify manual claim management workflows by leveraging remote and virtual inspection apps. Here’s how.
High frequency, low severity vs. low frequency, high severity claims
The Insurance Information Institute (III) states that insurers classify claims by the average number per 100 policies (frequency) and the average amount to be paid for each claim (severity). As a result, there are two types of property claims:
• high frequency, low severity — e.g. pipe-burst, kitchen fire, water heater leak, etc.
• low frequency, high severity — e.g. natural disasters such as hurricane or tornadoes
In both these types of claims, remote and virtual inspection seems to be the best way to tackle the incoming claims.
In case of high frequency and low severity claims, customers can use the virtual collaboration platform to live stream property damage evidences in real time. They can also share property damage evidences in the form of photos, videos, witness testimony, and proof of insurance. Setting up a remote inspection takes just few seconds, and inspection can be completed by claims examiners in minutes. This enables nothing but faster settlement of claims.
Previously, when a catastrophic event such as hurricane stuck, the only option was to wait for the debris to be cleared so that claims examiners or third party adjusters could visit the loss site and inspect the properties. This was a lengthy process where every single loss needed to be documented, pictures to be taken, sent to home office for evaluation and estimation. Now with the Remote Claims Assessment's inspection app, as the recovery process begins, inspectors can do a live video streaming with home office claims examiners and start resolving the claim faster than before.
In some cases, water damage may go dry before a claims inspector visits the property in person for assessment. In these cases, mold and fungus may affect the property which may lead to bodily injury claims. Early inspection and repair approval, especially in such cases, will help in not only to begin faster repair work but also mitigate the loss for insurers. Early observation offers timely documentation of the subrogation opportunity and a far greater window for recovery.
Policyholder expectations for claims handling are on the rise
With any loss, policyholders expect claim resolution in days or weeks, not months. Further policyholder wishes to directly discuss the claim with claims adjusters so they can obtain first-hand information.
Dennis Ingersoll, Director of Claims for Allianz, noted how customer expectations have changed over time, "In the last few years, the expectation from our customers is that they can communicate with us from any channel, and they expect an immediate response. So it's changing the dynamics, the way claims get processed, and the expectations on us as one of their providers."
"When we launched our Livegenic product," said Edward Kenny, Livegenic's Director of Customer Success/Account Management, "it was back in 2014 with the goal to build a communications tool that allows carriers and policyholders to engage throughout."
The way forward for property insurers
Livegenic's virtual claims processing tool is designed to empower adjusters and claims processors to streamline claims processing.
Troy Jensen, Property and APD Manager at Bear River Mutual, who also shared about his positive experience with the Livegenic tool, believed technology like artificial intelligence (AI) and machine learning (ML) will continue to revolutionize claims handling. He further added, "In the next five years, we'll have technology that analyzes real-time property images, provides the estimate, guides the process through the review step, and then takes action on the estimate (or change) deciding to process and move to payment — all without the involvement of anyone. That's where I think the technology is headed."
According to Livegenic, adjusters can fully document more than 60% of all minor property claims within 24 hours of a virtual inspection. In fact, Livegenic was also named by The Best Claims Solutions as the Best App for Adjusters in 2022.