Fixing the motor claims process

Fixing the motor claims process | Insurance Business Australia

Fixing the motor claims process

It's an exciting time to be in insurance. Everything is evolving at speed – not least technology and consumer expectations. Customers are seeking from insurers the type of seamless, user-friendly experience they get from their day-to-day digital interactions.

In motor claims, however, positive change is chugging along in a lower gear – and through no fault of claims handlers, who do “a mighty job in often trying circumstances,” according to Steve Chapman, managing director, and Daniel Lukich, sales and strategic relationships manager at Australian Accident Management Commercial (AAMC). The company has great depth of knowledge in the motor claims sector, having spent 19 years providing end-to-end accident management, specialist assessing and bespoke repair management solutions to top insurers across Australia.

“We really appreciate the environment that claims handlers work in, especially with COVID, catastrophes that are unplanned for and technology that isn’t nimble,” Chapman says. “We are here to support that. We want to share our expertise so our clients can better understand the nuances around fixing the vehicles they insure.”

That expertise is extensive. Along with highly experienced passenger and light vehicle assessors, AAMC has the specialist skills and capability to manage heavy motor, machinery, agricultural and plant, motor-cycle, and caravan assessments. Its repair management stream looks after the whole life cycle of the repair, from first notification of loss all the way through to the repatriation of the vehicle.

“Specialising in the automotive repair space came as a no-brainer to us with respect to the future, especially with the advent of EVs and the continued development of sophisticated ADAS systems and telematics,” Chapman says.

However, for all stakeholders – insurers, customers and brokers – to better benefit from that expertise, Chapman and Lukich believe a shift is needed, especially for broker-initiated claims. Lukich explains that it’s not uncommon for more than 10 days to elapse from the date of loss to specialists like AAMC being appointed by the insurer to manage the repair. Instead, it would be relatively simple to identify the types of claims where AAMC is engaged and embed the specialist in the claims process much earlier on, which would vastly enhance the experience for all concerned.

This is already common practice in other sectors, Lukich points out; in property insurance, for example, insurers empower brokers to appoint loss adjusters to manage the whole job from the outset.

“From the first notifi cation of loss, they are on-site, organising the trades, writing a report, coordinating the whole thing; they are seen as the subject-matter expert,” Lukich says. “Yet in motor, insurers tend to wait until the customer has obtained and submitted an estimate before they review and allocate, at which point, we get push-back from customers when we call and say, ‘Hi, we’ve been appointed to assess your claim’, and they say, ‘That’s great, but I lodged this claim 10 days ago!’

“The motor insurance sector is moving ahead rapidly – from buying insurance and updating policies online, new vehicle manufacturing and repair technologies, and of course, today’s consumer’s expectations to be able to choose how they interact with their brokers and insurers. But how claims are lodged and processed is still fi rmly stuck in the past.”

A lot happens during that 10-day delay, Chapman adds: cost overrun, lack of control for both broker and customer, and an expansion of the life of the claim.

“The insurer can’t begin to recover from the at-fault party because they are waiting for the costs to come in and the vehicle to be assessed,” he says. “It all adds up to a very inefficient, multi-touch process. When you require an experienced claims handler answering emails and phone calls multiple times through a claim, that’s a signifi cant and unproductive cost the insurers carry.

“Ask any consumer who has had a motor claim on a personal lines policy recently, and the ones who have had a really great experience are the ones where the insurer has a strategic partnership approach with their repair and assessing suppliers to ensure all participants know the process and their role. If you fall outside of that, it’s purely luck of the draw. There is nothing sophisticated or structured around the customer experience for broker-initiated commercial claims at this point in time.”

From analogue to digital

A linear, one-touchpoint-at-a-time process can be eliminated by introducing relatively inexpensive digital capability, Lukich says. In the UK, for instance, if you break a window in your home, digital claim lodgement technology allows you to notify your insurer, and their preferred glazier is immediately notified and dispatched to help you, keeping you updated through your digital device.

So why not adopt this multifaceted approach for motor claims? At lodgement, via a broker, they could get the ball rolling on the claim and the repair at the same time, achieving timeliness for customers.

“A broker’s customer needs that vehicle back on road, especially if it’s a business vehicle,” Chapman says. “Having the ability to immediately match an appropriate repairer with a vehicle’s technical and damage requirements, you not only save time but also have better control of what is going to be a quality outcome. That is where we see the opportunity with respect to the broker world.”

Lukich says it’s not about angling for more work from insurers, but formalising something that already happens and embedding rules in the process to remove uncertainty.

“We have discussed this with insurer clients who see the logic of saying, ‘Let’s identify the type of claim that we are happy to go to AAMC.’ If it’s a Toyota Corolla with minor damage from a supermarket car park, that won’t come to us. But if it’s a truck that’s rolled over in a regional location, 98% of the time, we will be appointed by the insurer. So rather than go through all those decision points, why not have an auto-triage capability that allows the broker to appoint us directly from first notifi cation of loss?

“This could easily be via rules within an insurer’s online lodgement capability so that we have early visibility of the claim. It’s as simple as that. It’s identifying the nature of the claim that we specialise in, removing that question mark over who and when it’s going to be done. The broker could be delegated authority to create that capability.”

Because AAMC is digitally agnostic, it can operate within the insurer’s claims ecosystem. However, if it’s a small or niche insurer that doesn’t have the digital capacity, AAMC can provide it with a customer interface as part of its package as the service provider.

“We are nimble and open to innovation and looking at the changing needs of the environment,” Chapman says. “Investing in digital technology means we can aid the efficiency, transparency and ultimate cost control of the claim.”

Improving the broker experience

Aside from this automated delegation of repair management to a specialist where necessary, Chapman says there is more AAMC can do to support the broker – and ultimately the client.

The company is planning a series of webinars on subjects like modern heavy haulage damage repair, the cost of having a commercial vehicle off-road, what’s involved in repairing modern trailers for prime movers, and more topics related to the growing complexity of today’s vehicles and the increasing sophistication of the assessor's role.

“I see brokers and insurers getting a lot out of that,” Chapman says. “We have invested heavily in our technical resources. We facilitate ongoing training and development to keep our teams up to a certain standard; we are always auditing and testing their knowledge. I believe it’s also important for our customers and stakeholders to have insights into what is becoming a very complex process. As we educate ourselves more and more on this sector, we need to impart that knowledge to our insurer clients – and the broker is a big part of that.”

“Ask a broker to state the difference between their business and their competition, and they will easily identify all their expertise, value-adds and benefi ts,” Lukich adds – and it’s the same with motor body repairers, not all of whom are created equal in terms of skill set. “If we can educate brokers around the nuances of fi xing the vehicles they insure, and if they know what happens next when they partner with us, ultimately it will be a better outcome for the customer.”