Bo Yu, claims lead at Markel Asia, explains how digital tools and technology are changing the claims landscape and why insurers must stay ahead of this curve.
Markel International, London
By Bo Yu, Claims lead, Asia
The insurance sector is known to be conservative when it comes to digital adoption. While we have seen some insurance companies ramp-up digital efforts in recent years, many are still reluctant to transition from paper to digital filing systems.
The nationwide lockdown imposed by the coronavirus pandemic highlighted inefficacies in insurance claim processes and gave new impetus to technology investment and innovations. Amid economic recession and uncertainty, InsureTech investments spiked to USD $2.2 billion in the first half of 2020, according to a Deloitte study.
Among technologies, InsureTechs with ready-to use-solutions, particularly in claims facilitation management, are most likely to be the earliest technologies adopted by insurers. LexisNexis Risk Solutions cites that less than 15% of auto insurance claims were handled virtually prior to the pandemic, and slightly over a year later, an incredible rise to 60% of such claims are managed virtually.
"The pandemic experience has completely validated insurer efforts in digitalising their operations."
The pandemic experience has completely validated insurer efforts in digitalising their operations. Players who moved into electronic filing systems pre-Covid nimbly adopted remote-working arrangements meeting safe-distancing regulations far more rapidly than traditional manual paper-based ones. These digital-enabled insurers deftly handled key client account workload and claims-processing smoothly throughout the pandemic, standing out clearly from some traditional competitors who were struggling to adapt.
Another major trend is AI-driven automation utilising big data-analytics and machine learning to accurately manage straightforward claims. With such AI-enabled solutions in place, the claims management process has become significantly more productive with claims handlers freeing time to focus on large complex cases and sensitive customer issues that require in-person communication.
Despite the clear trend towards remote claims handling, there are still a few hurdles remaining that the industry needs to overcome.
One key challenge is enhancing claims processing quality and customer experience. According to Deloitte’s report cited above, increasing virtual claims customer interaction is one of the top priorities for insurers – how the insurer can remain approachable once clients require in-person communication.
A second challenge is the need to further strengthen fraud detection and the investigation process to avoid fraudulent virtual claims. Current solutions in development include the application of advanced analytics and machine learning (ML) to proactively monitor claims recovery, using IoT devices to supplement other loss data to enhance fraud identification, and harnessing public domain resources for photo evidence suggesting fraud. All these enhanced digital tools will enable the claims handler to reduce risks and make more informed accurate decisions.
"One key challenge is enhancing claims processing quality and customer experience.”
Lastly, the industry needs to attract and develop staff with enhanced capabilities, handling virtual claims, digital fraud detection and data science tools. Such training will importantly require equipping industry claims professionals with new digital skillsets in response to the rapid, changing environment.
At Markel Asia, we already possess a full range of virtual and remote claims capabilities, so apart from not being able to meet physically, the lockdown has had minimal impact on our work. One interesting claims assessment technology we experimented with has been the adoption of drones. Covid-19 has restricted human movements, making it extremely difficult to perform on-site investigation. As photographs are one of the most common supporting documents for physical damage claims, drones have made it possible to access both remote and locked-down locations to capture situational details and angles a surveyor needs for accurate assessment. ‘Live’ footage is a further enhancement to such capabilities and is one of the technologies that has proven highly effective.
We want to give you and your business the confidence to keep going whatever happens, so our highly experienced claims specialists are here to help. Our claims service is award-winning. We understand that claiming for a loss can be difficult, particularly in uncertain times, and so we make the process as fair and easy as it can be. Click here to find out more.
About Markel International:
Markel International is a division of Markel Corporation, a US-based holding company trading on the New York Stock Exchange (NYSE: MKL). Markel International writes insurance and reinsurance business through six divisions and through offices across the UK, Europe, Canada, Latin America and Asia Pacific. Markel International’s insuring entities include Syndicate 3000, Markel International Insurance Company Limited, Markel Insurance SE., and Markel Resseguradora do Brasil S.A.
Its UK national markets business also provides legal and professional fees insurance cover as well as legal and tax consultancy services.