ILC ARTICLE

Weathering the claims inflation storm through data enrichment

20th October 2022

Article supplied by Kajal Vakas, senior manager of claims, LexisNexis Risk Solutions, Insurance, UK and Ireland

Claims professionals are all too aware that inflation could reach 11% this year. With the cost-of-living crisis deepening along with the ongoing challenges created by Brexit and the residual effects of the pandemic, claims costs are rising.

This is increasing pressure on insurance providers to bring greater efficiencies into the claims process without detriment to customer service or increasing the risk of fraud. The unerring focus on claims service came out loud and clear in the Chartered Insurance Institute’s (CII) survey to support the CII Public Trust Index. This found quality of service means more to most consumers than price, and at claim, they want to be shown compassion and offered effective assistance and advice.

Delivering on those expectations while shortening the claims journey, speeding settlement and reducing claims handler time could come down to data enrichment at first notification of loss (FNOL) and beyond.

Data enrichment is by no means new to insurance workflows, specifically as part of the application, pricing and underwriting journey, but is still relatively under-exploited within the claims process. The time could be ripe for a review of data enrichment at FNOL – to help claims teams enhance the claims experience while unveiling potentially fraudulent activity.

Insurance specific data enrichment could be leveraged to gain a fuller picture of the claim and the claimant. The starting point is ensuring any information already held on the claimant is accurate, up to date and reflects every touchpoint the individual has had with the business.  Have they, for example, just had a quote for car insurance when they are claiming on a household insurance product?

Creating this 360-degree customer view can be easier said than done given the data silos that exist across the industry but linking and matching technology is now making it possible to bring data together from multiple business areas without needing to re-platform.

Email intelligence can help uncover any past links to fraud. The claimant’s claims history could also be reviewed alongside the claims history for the asset – whether it’s the home or the vehicle along with granular data about the vehicle or property and its location.

Data enrichment could confirm, for example, if the property is in an area known to have been impacted by a flood or has a high crime rate; if an escape of water loss is the latest in a series for that property, prior to the policyholder’s tenure; or whether a vehicle has been fitted with an Advanced Driver Assistance System (ADAS) which may have been damaged in the incident and need recalibration as part of the repair process.

Understanding key facts such as this up front not only takes the onus off the customer to provide some of this information at what is often a stressful time for them, but it removes the need to validate the information provided and means the claims handler can focus on obtaining key details around the circumstances of the claim. The result should be a faster FNOL process with fewer opportunities for friction or for a fraudulent claim to slip through the net. Bring in real-time data from a device in the future and the potential opens up to truly get on the front foot of FNOL to accelerate the post-FNOL process and ultimately reach settlement faster.

When considering the power data enrichment offers in pricing, data enrichment at FNOL makes a great deal of sense as long as it is quickly and easily injected into claims workflows and adding value to the customer experience.

There are many elements of claims inflation that claims professionals cannot control but process efficiencies, effective fraud detection and empathetic claims handling can help to drive down the internal costs that can be controlled and engender customer loyalty in the process. There has never been a better time for insurance providers to leverage the data enriched single customer view at FNOL.