After a rear-end collision a connected car automatically alerts the service center of the relevant insurer and one of their employees can get in touch with the client and offer support. Depending on the damage, the insurer's staff will then organize for a tow truck or an appointment in the nearest authorized repair shop and a replacement vehicle. Technically, such service is already feasible, organizationally though, it still remains a challenge. Culturally it represents a new start for the claims management of non-life insurers.
Overall costs reduced by up to 5 percent
The future in property insurance will be defined by action instead of reaction – to the advantage of insurance providers and their customers. In Bain's experience, 3 to 5 percent of the overall costs can be saved by systematically optimizing claims management with the use of digital technology. At the same time, no other factor has more influence on customer loyalty than after-damage support and claims settlement. Insurance providers who act fast and professionally in each case of damage strengthen the ties to their customers and raise their willingness to recommend their insurance provider to family and friends. Also, the change from vendor of policies and claims administration to solutions provider mirrors the changing expectations of clients in the digital era.
Bain's field-tested Claims Excellence Framework provides the strategic platform to realign and optimize the claims management. It uses three different levers: claims procurement, claims steering and cost efficiency. The choice of the right suppliers is key in this process since in about half of the insurance cases external partners such as repair shops, surveyors or garages are used. In the end, their work is decisive for the client's satisfaction. Optimizing the claims procurement therefore does not necessarily mean to negotiate better conditions, but also to find excellent partners with high standards in quality and service.
Active management of more than 50 percent of the claims
The role of these partners in dealing with claims can be significantly increased by optimizing claims steering. Trailblazers in the industry influence the choice of external suppliers in more than 50 percent of the cases. Extensive process automation as well as simple rules of control allow for such a high ratio. The level of automation also provides higher cost efficiency. The underlying new vision is one of a digital claims management based on the use of self-learning systems.
In Bain's experience, optimized claims management can help to reduce the total cost by up to 5 percent which comprises the optimization of prices with external suppliers by 30 percent, raise the number of actively steered claims by 25 percent and increase the productivity in dealing with damages by 15 percent. Processing claims will become faster and the provision of excellent service increases customer loyalty. Reasons enough to get claims management primed for action.