In insurance, a claim is usually an official request for compensation made by an insurance policy holder to the insurance company that owns the policy. The claim management process is one of the most crucial aspects of operations in the insurance industry. The process commences as soon as the insured’s request is received but also involves other steps such as assessment, validation or verification, approval [or disapproval], and eventual settlement of the claim.
Like in other industries, advancements in technology continue to play an important role in many of the processes involved in motor insurance, including claims management. Indeed, in the face of a rising number of claims, higher costs for insurance firms, and lately the COVID-19 pandemic, the use of technologies such as cloud, artificial intelligence, machine learning, big data analytics, chatbot, blockchain, IoT, etc has become a sine-qua-non for efficiency and success.
The benefits of Technology in the Motor Insurance Industry
1. Detecting Fraud
Statistics show that there are large numbers of fraud cases in motor insurance and other forms of insurance annually. Technologies like blockchain and several other data analysis software are just some examples of the power of digital technologies when it comes to fraud detection in motor insurance. Effective utilization of these digital and other relevant technologies to detect fraud can help insurers save the resources that would have otherwise been used to settle fraudulent claims in addition to enhancing their image and deterring future dubious claims.
2. Revamped Efficacy
One of the benefits of digital transformation in motor insurance is the simplicity and ease it brings to the entire claims management process, from the claim request through to its validation and settlement. Such digital operations are not only easier but also much quicker than manual operations hence preventing a backlog of cases. Clients who have their claims promptly settled are likely to be very satisfied and loyal to their insurer.
3. Reduced Risks and Costs
A robust and efficient digitization of the claim management process can make a significant difference in terms of motor insurance risk management, thanks to the powers of technologies like artificial intelligence and machine learning, to mention a few. Also, utilizing technologies like artificial intelligence in auto insurance for activities like data processing and analysis can help reduce costs [and maximize profits] better than operating manually.
4. Seamless Communication
Effective and timely company-client communication is an important component of today’s business environment. Technologies such as mobile telephony, electronic mail, and social media are tools available to both parties to ensure that communication does not impede quality service delivery, customer satisfaction, and ultimately brand loyalty.
Claims Management in a Competitive Market
The global motor insurance market is characterized by a large number of firms competing for clients and an improved share of the market. One way for a firm to survive such stiff competition is to adopt modern measures, including the newest claims management technologies to ensure it not only attracts new customers but also retains them through innovative, customer-centric, and qualitative delivery of products and services. A company that is pragmatic in terms of embracing new ideas and methods is more likely to survive in the long term than otherwise.