'Let it go': Report urges insurers to outsource claims

'Let it go': Report urges insurers to outsource claims

'Let it go': Report urges insurers to outsource claims PriceWaterhouseCoopers (PwC) is advising insurance companies to let it go and outsource where appropriate in order to deliver a high-quality claims service to customers.

One of five dimensions named in the PwC report Claim to fame: Positioning the claims function for operational excellence, PwC said creating efficiencies from scale in an outsourced operating model is one key to a successful claims transformation.

"Build efficiencies of scale where possible by sharing talent among larger groups of adjusters with specialized skills to allow for better internal work balance and sharing among adjusters," states the report.

"Outsource where appropriate to deliver high-quality service to claims customers while maintaining due focus on the core business."

Although the report is an American one, it is still worth considering in Australia given that some insurers are offshoring, and outsourcing services to international companies.

PwC listed 'five dimensions' to a successful claims transformation, including recommending the use of analytics to understand their customers’ patterns of behaviour, and to integrate advanced telephony systems with their claims systems.

Another recommendation is using advanced technology, advising insurers to ensure that the new claims system is connected with other systems (such as policy administration) to share data across the organisation.

PwC gives the example of one leading insurer (which it doesn't identify) that uses "third-party fraud frameworks within special investigative units, resulting in increased efficiency and accuracy by preventing, detecting, and managing claim fraud."

The insurer is applauded for partnering with "third-party data providers to provide real-time data (such as geospatial, workers' compensation injury reporting) that is integrated into insurer's claims operations."

The fourth dimension highlights the customer experience, stating that a successful claims transformation entails minimizing the number of touch points that customers need.

'Integrated management,' the fifth dimension listed in the report, involves integrating the claims function with other departments in the company.
 
 
3 Comments
  • Walter A Nodelman 1/09/2014 11:36:54 AM
    When I telephone to an INSURANCE CLAIM center and I hear an accent from someplace "OFFSHORED", -- my immediate reaction is to demand that my Insurance Policy be cancelled, effective on the last day of next month. On the first workday of the following month -- send me a check containing my unearned Premium pre-paid to the OFFSHORING insurance company.

    I flee from "OFFSHORED" with enthusiasm.
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  • Greg Cottrell - Insurance Professional Dinosaur 1/09/2014 1:15:19 PM
    There are already some very good claims management companies, particularly those with modern software capability.
    However, will the modern software "in Australia" be more or less competitive to the cost of overseas labor?. The new era of insurance being displayed in Australia is "cost of expenses before quality service".
    For those in the industry with their head in the sand, which is the majority unfortunately, we are headed to a banking model which means "no customer control or competition", this also means no "Broker" control other than that of a "agent of the insurer".
    Who is then going to be the advocate for the insurance consumer, lawyers...........?
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  • Tony Jackson 1/09/2014 1:36:07 PM
    Firstly, the idea that loss adjusters have claims management skills is no longer certain. Claims assessing skills are at an all-time low in the Australian market, driven down by insurer's cost cutting.
    Secondly, claims delivery is the most important service delivered by an insurer. It's the reason for their existence. Why would you consider outsourcing your principal product to adjusters, or Manila or Mumbai or anywhere else? Unless, of course your business was being run by accountants.
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