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Visiongain
Management Report April 2003
Table of Contents
E-Claims - Market Outlook 2002 - 2007 provides the most up-to-date and comprehensive account of the current status and predictions regarding the development of online insurance and online claims within the insurance industry. Given the current competitive climate within the UK, European and US property and casualty market, the underlying assumption would be that insurers would maximise the possibilities for acquiring an edge over their industry rivals. Especially within the claims arena. Insurance claims are defined by escalating costs.
Furthermore, these costs are generated, because the claims process consumes a significant proportion of human and paper resources and call centre time in notifying, tracking and settling a claim. Given the fact that claims is essentially information intensive, it is entirely conducive to automation, therefore eradicating the paper-intensity of the process, as well as the drain on human resources. Despite the advantages intrinsic to an insurance e-claims service, less than 2 per cent of Insurers in the UK and 10 per cent of Insurers in the US have adopted such a system. Even the figure heads of the industry have been tardy in their incorporation of the facility. Where as other commentators have proven to be antagonistic to the idea altogether. There are many politics at play in this debate and many misfounded conceptions as to the rigidity and task of incorporating such a facility.
OBJECTIVES OF REPORT
This report purports to dispel some of the myths and resolve some of the leading concerns surrounding e-claims, especially the security concerns and fears of disintermediation rendering the broker’s role obsolete. What is more, this report serves to highlight the actual benefits and the competitive advantage that could be realised from integrating such a system. The reluctance largely stems from a lack of understanding and awareness of the flexibility of these systems. Instead of insurers simply waiting for the rest of the industry to take the initiative, the sooner these systems are incorporated, the sooner the long-term dividends will be realised, the sooner inefficiencies will be alleviated and the sooner insurers will gain the advantage over the competition. After all, e-claims is surely just a logical progression from the widely acclaimed and successful e-insurance quote and buy system?
METHODOLOGY
This information was obtained from structural interviews, questionnaires, case studies, commentaries and statistical analyses produced by Visiongain and supplementary market research. The sample utilised in these qualitative and quantitative studies comprised of the leading insurance providers, insurance brokers, loss adjusters and software providers within the insurance arena, as well incorporating other bodies who play an inextricable role in the claims-management process. Moreover, this discussion provides a comparative account and statistical deconstruction of the utilisation and progress of e-claims, within the US and the UK. Consequently this report provides the definitive, most valid and reliable insight into e-claims community.
KEY FINDINGS
The impact of web-enablement on traditional insurance practices, within the personal, commercial and reinsurance niche, (i.e. 90% of re-insurance claims are performed online); Incidence of adoption of integrated internet and e-commerce technologies (18% in US and 7% in UK) across the various sectors of the insurance industry; Top 10 insurance web sites in the US and UK Growth of internet presence of insurance products in the US between February and August 2002: Online claims submission increased from 6% to 10%, in the UK 0.9% to 2%, thus commanding the least online presence and growth compared to the other online offerings: policy purchase, policy updates, agent locators, interactive e-mails and feedback forms; Calculating online revenues and savings already generated and forecasted by e-insurance: In the US, respondents expect e-business to generate 19% in annual savings on average compared with an estimated 9% today in the US.
Respectively, the UK respondents expected-business to generate around 3% in annual savings today with an anticipated increase to 11%, in three years time. Discussion of the leading factors underpinning the industry’s widespread reluctance to develop e-claim initiatives, together with commentaries from the industry’s figureheads and Visiongain surveys: E-claims place the brand at risk Insurance claims necessitate human interaction & incompatible with an automated process Security and fraud concerns Need for increased IT training Impact of transparency on the partners in the claims process Scepticism regarding the costs, speed and success of the facility The report explores the chief benefits of employing an integrated system by way of industry experience, speculation and detailed case studies from Claims Resolutions Management Company (CRMC), Directline and MillionZillion software provider, as illustrated by insurance providers, brokers, loss adjusters and software providers.
Real-time information Transparent system for tracking claim Saving time/money/resources Speedier real time responses Streamlining, tailored functions, adaptability of Application Service Providers (ASP’s) The functionality of ASP’s and ability to perform complex business configurations, as illustrated by the CRMC, MillionZillion, e-Autoclaims Calculating Recommendations for augmenting and optimising web opportunities via web content for encouraging repeat visits, security measures etc.
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