For a long time, the insurance industry has struggled with the claims process. Manual verification of claims, processing of claims amount, and segmenting policyholders before claims are made to avert undesirable outcomes have all been cumbersome for insurance companies.
Thankfully, data analytics have come to the rescue of insurance companies like the proverbial knight in the shining armor. With all that data available today, it has only become easier for insurers to carefully segment policyholders and provide better products customized for individual needs. This has helped not only to cross-sell and up-sell insurance products but also to enhance customer satisfaction. In addition, Big Data has helped insurance companies to process claims quickly and efficiently.
While Big Data is inherently vast and contains extremely useful information, it is also its nature to be superfluous and chaotic. Too much information and data can actually cause difficulties for insurance companies which often seek specific information and data about customers and insurance trends. This is where data analytics comes riding on horses.
In this article, let us take a look at how Big Data improves claims process and saves the day for insurers.
Why do we need Big Data Analytics in claims process? Because claims is a complicated business.
As an insurer can vouch for it, claims processing is no easy business. Most insurance professionals consider the processing of claims the most arduous and difficult part of their professional duties. Yet, it is also the most important and crucial aspect of policy handling and processing. Processing of claims consists of four important steps:
While it may seem simple on the outside, it is a gnarly and prickly business for those who are actually involved in the claims process. This is because care needs to be taken that customers do not feel offended at any point and that each sub-step is smooth and transparent. We must also remember that each of these four steps have multiple ramifications for the insurer, intermediaries if any, and the claimant. The claims process and the four sub-steps involve a number of decision points all of which are based on verification of data and analyzing what is already known and predicting certain outcomes. These outcomes involve operations, management of risk, settling the final amount, and ensuring that customers remain loyal to the insurance brand. Claims analytics makes sure that all these steps in claims process are easily handled, and processed quickly and efficiently, without any errors.
Claims Analytics to the rescue
Claims Analytics is a unique technology that uses Big Data Analytics, Predictive Analytics and programming to make sense of structured and unstructured datasets during all the four steps of claims processing. Predictive analytics helps in recognizing trends and predicting outcomes, while prescriptive analytics helps insurers to take decisions quickly. Claims Analytics as a tool can be customized for each insurer so that their tool is perfectly tailor-made for their unique product and market requirements. Claims Analytics helps pick and choose relevant datasets from a seemingly chaotic Big Data, to arrive at solutions automatically.
Claims Analytics helps insurers to :
In which areas can analytics enhance insurance claims data?
Claims Analytics can help insurance industry in a number of ways when it comes to enhancing insurance claims data. Let us take a look at some of the areas that are currently being supported by Claims Analytics.
Certainly, Claims Analytics is being used by many companies to grow profitable and deliver better customer experience. Here are 3 use cases in which Claims Analytics has helped companies to grow successfully, according to a recent Forbes article.
Claims Analytics is the way forward
We are in a situation where insurance is just another commodity. Most of the times, people purchase insurance along with other commodities. Insurance carriers will need to differentiate themselves from their competitors because the number of players out there is just overwhelming. Using Data Analytics to claims processing will help insurers to save money and time, leading to more efficient claims processing, and enhanced customer satisfaction. This not only gives insurers a competitive edge and a measurable ROI but also helps them grow profitable in the long term. Claims Analytics is already an essential technology in the insurance space. The question, how quickly will legacy insurance companies adopt it, or risk irrelevance.