6 minute read 10 May 2019
Black businessman using computer

How can RPA improve the claims process

By

Nicole Michaels

EY Global Insurance Business Transformation Leader

Transformation leader in insurance. Passionate about diversity and inclusiveness as a business imperative and growth driver.

6 minute read 10 May 2019

RPA can help claims leaders achieve their business objectives while leveraging existing technology and boosting returns on investments.

Across the insurance industry, claims organizations have made significant progress in modernizing their core processing systems in the last several years. Typically, the objectives of these programs are to increase speed, improve accuracy and reduce risks in all phases of claims handling. No matter where insurers are on this continuum, robotic process automation (RPA) can help them achieve their business objectives while leveraging existing technology and boosting returns on previous and current transformation investments.

Why RPA? Why now?

RPA involves the use of virtual workers, or software robots, to perform business tasks similar to human users. The main appeal for insurers is the ability to handle high-volume and complex data actions at exponentially greater speed than in the past.

RPA is also notably flexible, which makes it both business-enabling and IT-friendly. It can be deployed alone or with other technologies across the claims value chain. For example, robotics can:

  • Automate discrete tasks or activities
  • Work in consort with other systems on transaction processing, data manipulation, communication and response triggering
  • Facilitate straight-through or “no-touch” processing, working alongside analytics tool sets, and other cognitive technologies, such as machine earning and natural language processing

RPA in action: where to start the journey

The use of robots and automation can take many forms in claims, including both customer-facing and back-office functions and tasks. The following represent the most common and promising use cases across the industry.

1. Streamlining vendor applications and estimating: Most current estimating processes require adjusters or others to rekey data from one form or system to another. Robotics along with enabling technology such as optical character recognition (OCR) can eliminate that duplicate effort by bridging the gap between claims systems, vendor apps and third-party estimating systems.

2. Capturing and managing claimant data: RPA can be on the receiving end of claims submissions, especially those that typically include photos from customers. Robots can ensure the right information ends up in the right systems and attached to the right claims. As such, they ensure human representatives have the information they need to move claims forward and respond to customer inquiries. Customers who prefer self-service also benefit when submitted information is more readily accessible.

3. Streamlining, automating and enhancing communications: Claimant communication remains a largely manual undertaking, requiring adjusters or other claims staff to initiate and, in some cases, monitor the process. RPA can help operationalize smart rules so the right letter (e.g., those required to be sent 30 days after a loss is reported) reaches the right claimant at the right time through the right channel. For instance, robots can pull data from claims submission forms and pre-populate letters that are typically housed in other systems and map distribution to customer preferences.

4. Scanning, indexing and converting forms and data: RPA has proven especially proficient at pulling data from standard fields on medical bills, from claimant name and address, to provide information to coding details. Standard in name only, these forms are a common source of errors. Similarly, RPA can transfer and convert data across older claims systems that may be used by individual product lines or regions to newer enterprise systems.

5. Validating payments: Conventional wisdom holds that 3-5% of claims payments are inaccurate, though no one knows for sure, given the difficulty and expense in auditing all claims. The key is robots’ ability to quickly, cost-effectively and proactively run QA on entire populations of forms and payments, rather than just a small sample. For example, rather than auditors discovering a $5,000 payment on $500 settlement months after a customer has cashed the check, robots can flag the disparity beforehand. Further, they can help deliver the information and intelligence so that human analysts can investigate anomalies proactively.

6. Customer-facing enhancements: RPA can alleviate the need for time-consuming and costly adjuster input by supporting customer-friendly apps for capturing photos of fender-bender car accidents and submitting all claims submission forms with just a few taps and swipes. Chatbots, another automation tool easily integrated with RPA, are already handling many routine communications tasks, including notifications of settlements and customer inquiries into claim status.

7. Integrating other enabling technologies: Looking forward, RPA will become more prevalent, especially as claims groups adopt other enabling technologies. For instance, AI-powered bots will likely handle the inputs from drones conducting standard property inspections or surveying damage after catastrophic storms. Integrating RPA with machine learning and NLP can enable the initiation of new claims and issue FNOL communications by scanning and analyzing unstructured communications, including emails from agents or even voice interactions.

Suggested approach and lessons learned: following the leaders

Significant numbers of insurers are already using RPA in their claims organizations. In designing the business case for robotics, claims leaders should seek an incremental approach, adopting more ambitious use cases once they have built momentum and demonstrated results through initial and targeted deployments.

The following lessons learned come from early adopters:

  • In developing a business case and tangible ROI model, specific tactical questions can lead to the right strategy as well as clarify the highest priorities for near-term automation. Finding answers may require a robust assessment of current capabilities and the completion of a cost-benefit analysis, given that the candidates for automation may number into the dozens.

  • To ensure a smooth implementation and integration with other systems, there are many important infrastructure, governance and security questions to address. IT leaders reluctant to deploy another technology in the claims “stack” should consider how RPA can support strategic platform upgrades and those mandated by regulatory change. Most RPA tools are product and platform-agnostic and work with existing IT architecture.

  • External vendors and suppliers – including InsurTechs, consultants and systems integrators – will be part of the solution, so it’s important to choose wisely. Beyond technical expertise, look for those firms with deep technical and operational claims knowledge, including a clear understanding of how it impacts the customer experience.

  • As with other “digital” initiatives, claims leaders must invest time and resources in education and, if necessary, evangelization regarding the use of RPA. The delicate matter of robots taking over jobs should be addressed, most likely in the context of the need to reskill claims workers, as the role will evolve to become more analytical and more focused on customer needs and the most complex claims.

Summary

The time for adopting robotics in claims has come, due primarily to the compelling business case and imperative for claims leaders to enhance performance and contribute more value to the business. Indeed, as multiple early adopters have made clear, RPA is ready to help claims organizations advance and enhance outcomes in the digital era through increased automation, higher productivity and increased capacity and strategic focus for claims professionals.

About this article

By

Nicole Michaels

EY Global Insurance Business Transformation Leader

Transformation leader in insurance. Passionate about diversity and inclusiveness as a business imperative and growth driver.