Robot power: how RPA and AI can unlock claims efficiencies

As the COVID-19 pandemic rages on and consumer demands change, insurers are accelerating their digital transformation. In October a diverse panel of insurers outlined their adoption of transformational technologies in the claims process.

The panel session, “Integrate Robotic Process Automation and AI to Unlock Efficiencies in the Claims Process”, took place on October 28, during the Claims Innovation Virtual Event, organised by Intelligent Insurer.

Delivering on digital

Since the pandemic struck, there’s been a real acceleration in the way insurers are starting to look at their first notice of loss (FNOL) processes, explained Karen Furtado, partner at Strategy Meets Action and session moderator.

One company at the beginning of its robotic process automation (RPA) process is Arch Insurance.
Patrick Nails, executive vice president and chief claims officer at Arch Insurance, admitted he was not a ‘techie’ and, at the start of the process, he thought the company would find a technology that would solve all of its problems.

But technology doesn’t work for every different scenario, and so Arch Insurance settled on a certain RPA process, and began implementing it throughout its healthcare business.

“The healthcare space is not completely homogenous, but it’s mostly medical malpractice. However, medical malpractice claims have so many differences that it allowed us to test out different rules,” said Nails, adding that mistakes are learning opportunities for the company as the RPA is exported to other areas of business going forward.

Arch Insurance combined this technology with its staffing model, information which includes the pending times certain adjusters have and their expertise.

“We wanted to test to see if it could not only bring in the claim and populate the claims system, but also get the right assignment,” added Nails. “We are very focused on putting adjusters in the best position to add value, and take away the administrative aspects of the job.”

Within the last five years at State Auto Insurance Companies the purchasing process for a customer coming to the company through an independent agent and buying a policy has been completely digital.

Josh Thompson, vice president auto and property at State Auto, explained that the company quickly recognised that it needed to deliver a digital experience on the claims to match the experience on the front end of the process.

“FNOL is one of those areas we’ve invested heavily in. Over the past three years, we started with an RPA solution and evolved it into something a bit more,” Thompson said.

“Turning claims handlers more into value-added customer experience-type people and not so much task processors has been a win-win for our associates and our customers at the same time.”

Clay Rising, vice president claims at Kin Insurance, added: “One of things that has plagued the P&C side forever has been understanding severity at FNOL. It’s something that everyone across the board has struggled with.”

For homeowners insurer Kin Insurance the overall goal is to build out a model that is customer-facing.
“Based on some decision trees, we can obtain more concise and precise information at the time of FNOL and segment out claims to get them into the hands of the right people very quickly,” said Rising. “It’s an ever-evolving process.”

Kin Insurance analyses photos as part of its claim process. Rising added: “Having that immediate access to photos of actual damages from the FNOL circles back to the severity idea of knowing who do we need to get involved, how quickly and which adjuster needs to be involved.”

Solving problems

“My fellow panellists hit the nail on the head exactly in how to start with RPA and artificial intelligence (AI)—by thinking about first notice reporting. When you think about traditionally where you want to be able to use it, it is around having structured data with rules,” said Jordan Wahba, head of digital workforce management at Prudential Financial.

However, Wahba asserted, although RPA is a great technology, it doesn’t solve everything. “You can’t hit every nail with the RPA hammer,” he said.

He added that, in claims processing, RPA sometimes gives you the opportunity for the first time in a decade to look at the rule set required, and ask whether this is truly the right set of questions you should be asking.
Wahba concluded: “What is the most important information we need to be able to get from the customer to make a decision on this claim and get them what they need?

“Sometimes it simplifies the process. RPA may not be the right tool but it can make the process better.”

To watch the full session, titled ‘Integrate RPA and AI to Unlock Efficiencies in the Claims Process’, on-demand  click here to visit the Claims Innovation USA virtual event website.