Customer expectations and stagnating market conditions have disrupted the financial services sector, including P&C insurance carriers. Says Ernst and Young:
There was a time when financial services companies enjoyed all the benefits of a stable business environment and customer loyalty. Then came the financial crisis, which undermined confidence in traditional providers, and the rise of disruptive technologies, which led to a surge in Internet adoption and a newfound trust in online competitors. The result is an industry facing many uncertainties, such as fickle customers, disruptive technology and nontraditional competitors.
To address these uncertainties, leading P&C insurance carriers are “disrupting themselves.” They turn to technologies that enable greater scalability, higher operational efficiency, and better quality of service. By giving technologies like mobile software, live streaming video, and enterprise-grade wearables to field adjusters, carriers can:
- differentiate themselves from the competition,
- improve the speed and accuracy of claims operations,
- attract and retain customers through better quality of service,
- and maintain their lead in the marketplace.
Here are five areas where P&C insurance companies can use technology to improve operational flexibility and bottom and top lines.
1. Finite Human Resources
When widespread disaster strikes, as in the case of a wildfire, hurricane, or flood, it doesn’t matter how many insurance agents a P&C company has. The number of claims to agents is always in the claims’ favor.
But the way forward isn’t necessarily the traditional one of “more bodies in more places.” The method is expensive and a drain on existing resources. New hires have to be trained, then accompanied to inspection sites. The solution does nothing to mitigate the current problem: the need to file more claims in less time, now.
Some P&C companies are using streaming video to solve the problem. They augment agents with mobile devices and, in some instances, wearables. The technology can be used in many ways, but most of the time insurance agents inspect the property in their area of expertise. They then do the other inspections via real-time video collaboration with another agent. For example, the on-site agent may specialize in flooring. He or she “videos” in a coworker or senior agent to inspect the roofing. The inspection for the entire home takes less time and increases the productivity and efficiency of all the agents involved.
2. Claims Leakage
Inaccurate claims hurt the profit and loss (P&L) statements of carriers--no exceptions. Insurance companies have chased the sources of those inaccuracies for ages. However, it’s been difficult to root them out.
Technology is changing the odds. Technology means big data, and big data means information. By using data (which includes video, photographs, and rich documentation), P&C insurance carriers ensure their longevity. Policies are written with a better understanding of the insured property, managing risk on the front end. On the back end, a better “view” into the claim ensures that carriers pay out the right settlement the first time, no more and no less. The data also empowers them to take proactive steps against human errors, fraud, and other sources of inaccuracies.
3. Cycle Time
Consumers expect quotes in 15 minutes or less. They more or less expect the same when they file a claim.Today’s business world is an on-demand economy.
In fact, insurer responsiveness (actual or perceived) is one of the most important criteria for consumers when choosing a carrier. They want to know they’ll receive service quickly and accurately. Thus, any procedure and workflow that slows down the cycle time between the First Notice of Loss (FNOL) and settlement stands in the way of customer acquisition and retention.
P&C insurance carriers have responded to consumer demand via technology. Either they give technology to their agents, or they allow consumers to visually document simple claims, such as fender benders. Both scenarios lead to improved operational efficiency and faster and more accurate claims processing.
Cross-training, while critical and hugely beneficial, has historically been a drain on time, money, and resources. Senior adjusters are sent to the field to train junior counterparts in new disciplines. The costs aren’t related entirely to expenses found with sending the senior agent to meet with the junior one; they’re also found in lost material opportunities.
Insurance companies are finding cost savings with streaming video. Rather than going into the field, the senior agent becomes a junior agent’s “video companion.” The junior agent goes through an inspection, asks questions, and gets feedback in real-time. This allows the junior agent to learn on the job and get to work immediately rather than go through a long and sometimes inefficient onboarding and training experience.
5. Operational Flexibility
Operational flexibility and efficiency are found with continuous improvement. But the only way to continuously improve is through constant measurement and analysis.
Leading companies, regardless of industry, do just that. They decide on what data matters; institute metrics; implement the technologies needed to capture data; analyze the findings; and refine processes and procedures.
In the insurance industry, the practice equates to adjusters recording video and taking photos at each inspection; logging the media files and other documentation into their claims management dashboard; and comparing the files against other customer records for similarity. They then analyze the data to ensure compliance with accepted procedures, as well as identify areas for improvement.
The end result is a more accurate claims process and delighted employees and customers. When workflow is efficient,employees tend to be happier and more productive. Customers are more satisfied with the user experience. They receive their checks or other incentives faster and are therefore more loyal to the company.
The financial services industry is in a state of disruption. The only way forward is to disrupt, too. It leads to operational excellence through improved workflows and processes. It also grows customer retention and satisfaction--and that? That’s a gift that keeps on giving.
Want to learn more about how streaming video can positively impact your P&C insurance company? Set up a time to take Pristine, our secure streaming video solution, on a demo.
Image: State Farm (Creative Commons)