Technology: Let’s make some magic!

It’s time to bring claims departments into the modern era with new technology, writes

This is the 21st century. The internet, mobile phones and digital technology have revolutionised the way we live and work. Supermarket customer relationship management departments know more about our lifestyles than our friends do, while search engines pre-empt our every desire with unerring accuracy. Data is captured, collated, filtered and extrapolated at the touch of a button.
So why has no one told the claims department?

There is dissatisfaction among claims managers in relation to the levels of investment their departments receive. Medicals Direct’s latest Attitudes survey, carried out last November, canvassed claims managers from 30 insurers. The findings included that 55% believe there is an increased pressure to cut costs, while 34% believe that the biggest problem they face is a lack of investment in claims systems.

A lack of management information and investment, coupled with pressure to reduce costs, presents any management team with a major dilemma. What may also be preventing many companies from updating their systems and processes, however, is a mistaken assumption about the level of investment required.

The ideal solutions

Cost-effective solutions exist that can perform multiple functions such as harvesting the necessary data to design simple products, implementing an effective claims proposition, reducing the cost base and dramatically improving the customer journey.

Data is essential for any healthy business to develop its strategy and market proposition, as well as providing management with granular insight into its cost and pricing models. Without it, a business is more ­susceptible to knee-jerk reactions, which ultimately translate into a complex market proposition, inefficient processes and a sinking customer base.

If this is the case, why is it that claims departments across the land struggle to attract the investment required to develop cost-effective processes and services, obtain meaningful data to manage the business, and provide a customer journey which the consumer has come to expect from other retail markets?

Traditionally, any proposal to implement changes to existing claims procedures has come up against one or all of the following obstacles:

• The need to engage IT resource, whether in-house or outsourced – this can prove difficult due to the costs involved and, as a result, claims projects get pushed down the priority list
• Getting buy-in for the costs associated with purchasing a new system, which would traditionally involve significant set up, bespoke development and licensing costs
• Finding or developing a system that can provide detailed management information relating to medical ­interventions, evidence requests and the engagement with the customer
• Making a decision on integration with legacy systems: whether this is required or if it is better to ring-fence.

New business divisions have benefited from investment in new systems, processes and more flexible customer-facing mediums. Claims managers must address their need to follow suit. A radical approach should be taken to analyse the current position, to decide what wholesale changes are needed and what cost-effective solutions will deliver the new proposition.

If we were to put aside traditional claims systems and models, and wave a magic wand to produce the ideal claims management system, it should facilitate and support these:

• Claims notification: first contact with the customer
• Initial evidence: providing relevant data
• Technical resource: claims assessor and reinsurer’s input
• Medical interventions: accessing appropriate treatments
• Customer journey: maintaining meaningful and timely contact
• Management information: management and quality controls.