It is a point that has been made with enthusiasm and frequency – claims are the moment of truth for the insurance proposition. Patrick Hayward (pictured) has a front-seat view of the truth behind that attestation, not only in his role as a senior consultant with Altus Consulting, but also as the no-fault party in a recent home insurance claim.
“I might be biased by my claims background,” he said, “but ultimately what you’re paying for with insurance is that peace of mind so in the event something does occur, it’s not just put right but it’s done so in a way that’s fairly quick and effective, and during which your insurer communicates with you well. Because in those circumstances, people need their mind to be put at ease.”
It’s that balancing act of getting the tech solution piece right so claims can be dealt with swiftly and effectively while not losing touch with maintaining the right customer interactions that is the core area of focus for Hayward and the team at Altus. Both areas need to work in conjunction in order to support customers in getting back on their feet, he said, and finding solutions that support that blended approach is integral to the future of the claims space going forward.
Given his role, Hayward has a clear vision of some of the key trends occurring in claims. Looking at the personal lines sector, he said, most if not all major insurance companies are doing some kind of digital transformation work around claims. There are different drivers for this - many of which are around operational efficiency, while others centre more on the end-to-end customer experience piece in their ambition of improving self-serve capabilities.
“There are different considerations across product lines as well,” he said. “While some insurance companies are focusing on the FNOL stage, others are looking to dive deeper into that value chain and look at things such as remote adjusting capabilities, detailed claims tracking and the ability to allocate suppliers using analytics and an intelligent approach.
“Ultimately, I suppose the end goal of this, in a lot of respects, is being able to have a straight-through process for claims where you’re able, at the click of a button, to do the necessary background validation checks and make decisions and settle claims without this necessarily being touched by a handler.”
Of course, that ambition does not apply to all claims types but rather those in the complexity and lower value brackets where the risks are also lower. The highly competitive motor market is a key example of this, he said, as claims modernisation is being driven by a bid to achieve better efficiencies. Another driver of change in this market is regulatory changes, such as the introduction of the Civil Liability Act which is shaking up the status quo and introducing new opportunities, if not pressures, to increase automation.
“I think that’s an area where the industry has been largely waiting to see what the broader impacts of the change will be since it came into force,” Hayward said. “But I’d be surprised if it doesn’t lead to some significant changes to operating models in the coming years.”
It’s a different matter for markets like home and travel insurance where there’s more of a focus on customer experience and ensuring customers are indemnified for their losses. That’s around exploring whether it’s possible to create a straight-through process where consumers can have their claims validated swiftly or engage in a fully transparent process for repairs to their property. That customer experience is just as integral as operational efficiencies in these markets, which harks back to Hayward’s earlier point about getting the personal touch piece right, as well as the technology piece.
It all takes on a very different complexion when you move from a personal lines view to a commercial lines view, he said, though there are synergies with the SME market. When you’re looking at the small end of the SME space, there is scope for the greater standardisation of insurance products and the opportunity to introduce similar kinds of technology to those applied to personal lines products. That’s an area insurers are still trying to get grips with, as they explore how these technologies can be applied in a similar manner to a fundamentally different marketplace.
With all these trends, COVID-19 has been a significant driver, Hayward said, and that’s not just in claims but across the entire spectrum of how insurers manage their customer processes. COVID certainly prompted more interest in the concept of remote assessment tools – an area where significant inroads have been made in the motor space, while the property sector is falling slightly behind due to the different nature and value of claims involved.
COVID has certainly changed how insurers want to manage their overall workflow, he said, and they want to move to self-serve as much as possible. A variety of COVID-related reasons have caused this shift, including the urge to minimise the risk of illness to their loss adjusters and reduce pressure on their call centres, which were initially heavily impacted by the rapid move to remote working.
“Then, following that, is the fact that you’ve got a proportion of the workforce unavailable for periods of time, which again is a problem that will improve over time,” he said. “But I think it’s undoubtedly had a massive impact. And I think it’s changed the way a lot of companies, both within insurance and the broader sector as well, think about how their systems are engaged with by customers.”
