Reimagining Insurance Claims: From Adversaries to Allies

At the recent Reuters Events Insurance Connected Claims conference (#CCUSA), industry leaders and insurance professionals gathered to tackle some of the most pressing challenges facing the insurance sector today. Amidst discussions on data analytics, technological advancements, and shifting customer expectations, a unifying theme emerged: the urgent need to transform the claims process from a reactive, often adversarial encounter into a proactive, customer-centric experience.

Listen to the short automated review of the Reuters conference below.

Claims: From Cost Center to Profit Center

Don Jones , SVP at Allstate , shared his organization's groundbreaking approach to repositioning claims as a profit center rather than a cost burden.

We have to go in with the premise that we can't solve what we don't talk about, he emphasized.

By fostering open communication and collaboration across departments—claims, underwriting, product, and pricing—Allstate is breaking down traditional silos that hinder innovation.

He highlighted the importance of involving claims professionals early in product development to ensure that new offerings align with real-world customer needs and claims experiences.

Claims management has to have a central seat at the table in terms of how we're going to think about our new experience and our product experience, Jones noted.

This integrated approach not only enhances customer satisfaction but also drives profitability by reducing unforeseen costs.?

Bridging the Expectation Gap

Tim Temple , the Louisiana Insurance Commissioner, brought to light a critical disconnect between insurers and policyholders, especially in the aftermath of catastrophic events.

Recalling the unprecedented 800,000 claims following a series of hurricanes in Louisiana, Temple observed:

I don't think that the industry was prepared for that... Both sides just came at it with different expectations.

He pointed out that many consumers mistakenly believe that years of paying premiums equate to a form of equity or a guaranteed level of service.

They think they've got this long-term relationship built up with a company, and they just don't, he said.

This misunderstanding often leads to frustration and adversarial relationships when claims arise.

Temple's call to action was clear: better communication and education are essential.

The better a consumer is informed, I think the better a claims experience they're going to have, he stated.

By setting realistic expectations and enhancing transparency, insurers can improve trust and reduce conflict.?

The Rise of the Plaintiff's Bar

Perhaps one of the most eye-opening discussions centered around the growing influence of plaintiff's attorneys in shaping customer perceptions. Tanner Sheehan of LexisNexis Risk Solutions presented data revealing that customers who hired attorneys rated their experience significantly higher than those who dealt directly with insurance adjusters.

Attorneys are great at customer service, Sheehan asserted. And what's bad is that they are much better at customer service than carriers are.

The statistics were striking:

• Customers who hired attorneys reported higher satisfaction in every aspect of the claims process.
• 93% of individuals who used an attorney would do so again.
• Attorneys were perceived as more caring, communicative, and proactive.

This trend poses a significant challenge to insurers. If customers continue to feel underserved by their insurance providers, they may increasingly turn to attorneys, leading to higher litigation costs and strained relationships.

Embracing Technology and Data

Technology emerged as a powerful tool in transforming the claims experience. Peter Piotrowski , Chief Claims Officer at Hippo Insurance , shared how his company implemented a new claims management system in just 72 days.

By leveraging technology, Hippo streamlined processes, enhanced data sharing, and improved service levels.

We put in place speed, Piotrowski said. The standard for Hippo contact on any new claim submitted is the adjuster reaches out to you within two hours.

This swift response reduces customer anxiety and sets a positive tone for the claims process.

Additionally, partnerships between insurers and tech companies are paving the way for revolutionary developments. Natalie Kaschalk from Copart and Cornelius Young from Cambridge Mobile Telematics discussed how telematics and AI are enabling instant crash detection, accurate total loss determinations, and proactive customer engagement.

Cars are telling us what happened in an accident—we're just not listening, Kaschalk remarked.

By harnessing data from vehicle sensors and mobile devices, insurers can:

• Automatically detect accidents and severity.
• Dispatch emergency services when necessary.
• Initiate the claims process immediately.
• Reduce cycle times and associated costs.

These innovations not only enhance efficiency but also significantly improve customer satisfaction by reducing the time and hassle typically associated with claims.

Collaboration: Breaking Down Silos

A recurring message throughout the conference was the necessity for collaboration—not just within insurance companies but across the entire industry. Krista Glenn , EVP & Chief Claims Officer at Westfield Insurance , highlighted how plaintiff's attorneys excel at working together, sharing data, and presenting a unified front.

We need to cooperate as carriers, she urged. We need tort reform. We need to work on the disclosure of third-party litigation funding. We have a lot to do that would benefit all of us and ultimately would benefit the consumer.

By breaking down internal silos and fostering a culture of collaboration, insurers can develop more cohesive strategies to address common challenges, from regulatory hurdles to customer education.

Redefining Customer Engagement

The discussions also underscored the importance of redefining how insurers engage with customers. Eileen Potter , VP of Insurance Marketing from Smart Communications. , emphasized the need for clear, accessible communication.

A policy is a legal document. I'm not up reading my policy at night because who really is? she quipped.

Simplifying policy language, leveraging AI to provide personalized explanations, and engaging customers through their preferred channels can demystify insurance and empower consumers to make informed decisions.

A Call to Action: Towards a Customer-Centric Future

The consensus at the Reuters Connected Claims conference was clear—the insurance industry stands at a crossroads. To remain relevant and competitive, insurers must pivot from traditional, transactional models to ones that prioritize customer experience, transparency, and trust.

Commissioner Tim Temple's words resonated with many:

You've got to do better... What is our role? It's shifted. I don't think it's shifted for the positive.

By embracing technological advancements, fostering internal and industry-wide collaboration, and genuinely prioritizing the needs of policyholders, insurers can reshape the narrative. Claims should not be viewed as the end of the policy lifecycle but as a pivotal moment to strengthen customer relationships and deliver on the promises made.

Conclusion: Embracing a Transformative Era

The path forward requires bold action, innovative thinking, and a recommitment to the foundational principles of insurance—protection, trust, and service. As the industry navigates this transformative era, those who adapt and place the customer at the heart of their operations will not only survive but also thrive.

The challenges are significant, but so are the opportunities. By reimagining claims not as a burden but as a vital touchpoint, insurers can turn adversaries into allies and secure a brighter future for all stakeholders involved.

As echoed throughout the conference, the time for change is now. The question remains:

Will the insurance industry rise to the occasion?

Thanking Ira Sopic Alexandra Wilson and Lucy Hughes for a great event.

And as always... stay curious and keep innovating!

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