Original article appeared in Insurance Thought Leadership July 2022
Automation and other digital technology, often unseen by the consumer, continue to improve operations for insurers with the vision to embrace them.
Today, we can sit on the couch, in the car, or by the pool and buy anything we want online — including insurance. The evolution of the insurance industry makes it easier than ever to get quotes, choose the right policy, file claims and get updates on claims with very little effort. Whether consumers are shopping for car insurance, supplemental benefits such as accident insurance and critical illness coverage, or medical insurance, the processes are automated. Artificial intelligence (AI), machine learning (ML), optical character recognition (OCR), chatbots, data mining and automated underwriting tools are a few examples of automated technologies that make the processes easier for consumers and insurance carriers.
Integrated and Efficient Underwriting
Automation has introduced new efficiency to the underwriting process for insurance carriers. Tools such as FINEOS Underwrite, Optum and Workhuman allow for integration with their internal and third-party systems, automate workflow and ensure compliance with standards and requirements. As a result of automation, the carriers no longer must worry about manual, rote tasks and can instead focus on customer service and providing consistent information regardless of who the consumer is talking to within an insurance organization.
Aids in Choosing the Right Policy
When it comes to the consumer, it can be intimidating to choose the right policy for a specific situation. Automation makes this process easier. Most carriers provide comparison tools to help people choose the right policy in both the retail arena, such as car insurance, and in employee benefits. After answering a few basic questions, they are presented with a comparison of different policy options based on their individual and family needs. Price and coverage are personalized based on the information they entered. The introduction of AI and chatbots allows for answering basic questions instantaneously without talking to an actual person or waiting for a call back after a seemingly endless climb through a phone tree.
Simplifying the Claim Filing Process
Once coverage has been purchased, a claimant can use a computer or an app on a mobile phone to submit a claim. Filing a claim requires that sensitive information be shared with the carrier in a secure manner. These portals include the ability to upload documentation, eliminating the need to fax the documentation or figure out how to send an encrypted e-mail to try to keep the information secure.
Data mining allows automated decisions on some simple claims within just a few minutes if not a few seconds. Data mining can help insurance carriers configure their systems to identify claims that are approved a certain percentage of the time (e.g. 85%, 95% whatever the carrier is most comfortable with) and approve them based on submitted information and policy terms — without a person ever looking at the claim.
This is good for consumers because they know immediately that their claim was approved. And it’s good for insurers because their employees don’t have to manually process routine claims, freeing them to assist where their expertise is needed. For claims that are not simple, the claimant will receive instantaneous communication informing them if their filing is complete or if additional information is needed, with the specifics of what is still missing. This gives the claimant comfort in the knowledge that the carrier has received their claim instead of being left to wait and wonder until they receive a letter in the mail days or even weeks later.
Faster Claim Status and Tracking Process
Claims processing is significantly faster because of ML and OCR, and the claimant benefits. ML uses algorithms to learn what processes a human follows to automate those workflows. OCR can remove the need for a claims examiner to review the documentation to also speed up determination of a claim. The claims examiner can devote their expertise to more complex claims that require additional attention and communication with the claimant.
In addition to accelerating the determination process, digital solutions allow claimants to track their claims through a portal in real-time. Digital solutions let consumers choose how they want to receive their claim status updates and communications (text message, email, potentially even a paper letter). They can see status updates like, “Your claim is with an examiner but is still pending,” or “Your claim has been approved.” Customers typically receive notifications regarding the status of their cases in near real-time through prompts to log on or through an email or text message.
Smart and Fast Decisions
Although insurance can be intimidating, automation helps take away much of the difficulty in the decision-making and claims processing for consumers. It allows insurance carriers greater speed and efficiency processing simple claims, giving claims advocates more bandwidth to care for their clients. Automation and other digital technology, often unseen by the consumer, continue to improve operations for insurers with the vision to embrace them.