ILC ARTICLE

Making data work in claims

1st November 2022

According to the World Economic Forum a mammoth 79 zettabytes of data was processed in 2021, and that is expected to more than double to 181 zettabytes by 2025.

A zettabyte is billion terabytes or, to put it another way, as much information as there are grains of sand in all the world’s beaches and deserts.

Sifting through it all to find the grains of truth that are most valuable to your own claims business was the topic of a fascinating session delivered by the Davies Group at the first ever MGA Claims Conference, hosted by ILC in association with the MGAA.

Presented by Consulting Director Luke Cuthbertson and Partner Jon Glover, ‘Making the most of Claims Data to Differentiate an MGA’ sought to provide a better understanding of the technology available to help businesses gather data, while also offering practical examples of how that data, used correctly, can have a positive impact on both a company’s bottom line and its end customer.

Jon said, “We have more data than ever before but it only delivers value if you can draw insight from it. At the moment 68% of the data that is available to companies goes completely unused. That is partly because between 85% and 90% of it is unstructured – in documents, voice recordings or emails. So how do you go about accessing that?

“The first question you need to ask yourself is what do you want the data for? What insights do you want to gain from it? Once you know that then you can ask if the data you already have can provide it, and if not, where is that data and how do you get access to it?”

Technology

He suggested that regardless of what data you want, a technology probably exists now that is able to gather it. He pointed to the rapid developments in artificial intelligence and optical character recognition, both of which can help companies delve deeper to explore the 68% that remains untapped.

Jon said, “The reality is that this technology is enabling us to know our claims in a way that we haven’t been able to before.”

Cost remains as much a barrier as skills, but although the financial climate is challenging now, the price of adopting the latest technology is coming down fast, partly because of advancements like cloud technology and partly because of new entrants to market like Amazon and Google, who are increasing competition in the sector.

Davies Group has not been slow to capitalise and in the last 12-18 months has introduced new tech solutions that are delivering improved outcomes for itself and its customers.

Benefits

Luke revealed that in an effort to tackle rising instances of fraud, a client of theirs had asked claims handlers to listen out for subtle indictors and inconsistencies during first notification of loss. He said that results of this were mixed as claims handlers were too occupied taking claims details and populating fields on screen to be alert to potential signs of fraud.

Davies Group has now delivered an automated system that can do the listening for agents and flag up claims that may be suspicious.

It has also developed a solution based on optical character recognition and natural language processing that can interpret doctors’ notes to accurately identify potential large losses at an early stage, with identification rates increasing by hundreds a year since it was put into practice.

Meanwhile, Luke believes that better understanding of data can also have indirect benefits by improving service and increasing customer retention rates.

He said, “If we know what is happening at every single touchpoint and can then stitch that all together against an outcome, like renewal for example, then we are able to identify problem areas in the claims journey and step in quickly. When we did this ourselves we were able to provide a five per cent increase in retention rates.”

Culture

Data has long been described as the new oil, but just like oil it needs to be mined and used in the right way to fuel progress. The businesses able to do this are those most likely to go further down the road to full potential.

Luke concluded, “We’ve talked about the 68% of data that is under-used or undervalued, but the technology exists today to do something about that. You can’t start with the technology though; you have to start with the questions you want answered and then apply the technology that is suitable.

“But this isn’t slowing down. It’s only going to get faster and faster so I firmly believe the organisations that are going to make the best of this are those who are setting the foundations now and introducing a culture where people are used to working with data and using it as part of their decision-making.”

The MGA Claims Conference was supported by gold sponsors Claims Consortium Group, Clearspeed, Davies Group, DWF360 and EDAM Group, along with silver sponsors Robertson & Co, Vitesse PSP and Wiser Academy.