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Guide to Overcoming Common Challenges Using Insurance Claims Software

by Surya Choudhary 5 months ago in business
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Guide to Overcoming Common Challenges Using Insurance Claims Software
Photo by Scott Graham on Unsplash

The insurance sector is currently in the throes of a radical, digital revolution. As more and more clients are switching to digital channels, technologies like connected devices, smart home equipment, and artificial intelligence are ushering in an era of new solutions based on data and analytics. Future-forward insurance businesses are becoming more and more dependent on digital solutions like chatbots for transforming manual, legacy processes, and systems. Such an approach is a far cry from the traditional, and often inefficient processes of old-school insurance businesses.

The traditional insurance claims process is brimming with several challenges and disadvantages. For instance, data accuracy may be an issue when relying on manual claims processes. Accuracy and fraud prediction may also get impacted. Here are a few common challenges faced during the traditional claims process and how claims management software can help businesses overcome them.

Insurance is a complex industry with several lines of businesses covering multiple risks. An insurance policy is often distributed via different channels, including third-party agencies. With thousands of payees and records, it could take a long tie for claims managers to manually clean and classify the claim information.

Modern-day claims management software solutions use machine learning algorithms for enabling quick and multi-domain mastering across various data sources. These software solutions can easily integrate with other business software and systems to offer a consolidated view of the vendors. It helps in eliminating data silos and ensures data accuracy and consistency across the organization.

Redundancy and Inefficiencies

The traditional claims process is packed with volumes of paperwork. It is highly data-intensive and involves repetitive processes. This not only slows down the claims settlement process but also creates several inefficiencies. Moreover, manually assigning claims adjusters is a slow process as it highly depends on the availability, location, and expertise of the claims adjuster. Manual claims processes are slow, repetitive, and leave more room for errors.

Insurance claims software can automate a major chunk of the insurance claims process for more speed, efficiency, and accuracy. When complicated or tedious manual processes get assigned to claims management software, multiple tasks can be managed at the same time. Automating time-consuming processes means claims are settled more quickly and with fewer errors.

Data Security

Outdated systems are the primary target for cybercriminals. Malicious entities tend to target weaker systems for gaining unauthorized access. In several cases, the legacy systems no longer receive support from the vendor. These systems often do not receive updates and are not up-to-date on the latest threats. Moreover, the traditional claims process involves a lot of paperwork for recordkeeping. Paper poses a significant risk for the insurance business. Paper-based files are highly vulnerable to theft, misplacement, or loss. They can be easily destroyed in case of unforeseen events like floods or fires.

With that said, insurance claims software comes equipped with security measures for safeguarding customer and business data. These software systems help businesses store their data in a digital format and protect it using several layers of security with tiered access controls.

Lack of Convenience

Technology and innovation have made a number of services more efficient and effective. Convenience has emerged as an important factor in determining customer experience. Modern-day customers have less time and they prefer experiences over products. They prioritize convenience when evaluating options.

The traditional first notice of loss involves a number of cumbersome steps and documentation. Claimants find it to be inconvenient and it leads to an unpleasant experience. In the current world where customers want to be able to access information from any device and at any time, having to submit the claim by visiting a particular location and filling our various forms may lead to dissatisfaction.

Claims management software facilitates smart and consistent FNOL. It helps in offering customers a comprehensive omnichannel claims experience with self-servicing. Self-servicing ensures that the claimant does not have to wait for weeks for the estimator to click pictures. The extent of loss or damage can be ascertained at the first notice of loss and the photos can facilitate faster decisions.

Final Words

Nowadays, consumers treat insurance as just another commodity. A number of times, individuals buy insurance along with other things. In the era of rapidly changing consumer behavior and competition, insurance businesses have to differentiate themselves and their offerings. By leveraging modern-day insurance claims management software, insurance businesses can save resources, ensure a more efficient claims process, and improve customer satisfaction. This not just lends insurance companies a competitive advantage and better ROI but also helps them grow amidst disruptions.


About the author

Surya Choudhary

Surya Choudhary is a Project and Software Delivery Manager at Damco Solutions with demonstrated experience in streamlining processes for insurance companies.


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