How claims data can speed up the handling process

As the volume of claims data grows, the insights we can derive will grow too to help understand more about losses, writes Neill Slane of LexisNexis Risk Solutions

All parts of society have been impacted by Covid-19. The need to “Treat Customers Fairly”—an initiative launched 14 years ago when no-one could have predicted what the last 12 months would bring—at every point of their interaction with their insurance provider has taken on increased significance.

Whether it’s a young, single mum in lockdown with a leaking roof, a couple looking to update their home contents insurance to factor for permanent working from home, or a family fallen victim to burglary when they went on their one holiday last year, insurance providers have had to adapt and support their customers in new and unexpected ways. Above all, they have needed to show empathy and appreciation for the big changes in their customers’ day-to-day lives—and incomes. According to the Financial Conduct Authority, 31% of UK adults have seen a drop in their household income as a result of Covid-19.

Building the best picture of the individual at point of interaction—quote, renewal, mid-term adjustment or claim—through data enrichment, can help insurance providers price fairly and appropriately, make policy changes quickly, and expedite the claims process without opening themselves up to fraud. That picture is about to become more detailed through the introduction of market wide claims data –in home, motor and commercial.

This latest advance to bring market-wide claims data into the insurance ecosystem was in plan well before Covid-19 was part of our vocabulary. Pre-pandemic, we could see the huge potential of a market-wide pool of claims history data in supporting the customer journey. Now the database is being built, the relevance and value for today’s insurance market cannot be overstated. To know the circumstances, the settlement, the parties involved and much more surrounding prior claims will give insurance providers important context to make the best decisions for customers.

Taking the burglary scenario as an example: following first notification of loss, the claims team could access data on prior claims for the policyholder to see if there has been a burglary claim previously for the property or the policyholder. If so, when? What was claimed? How did the burglar gain entry? What was the settlement? Alternatively, they may find no history of past burglary claims and that this new incident appears to be an unfortunate one-time experience. That level of insight simply wouldn’t be possible unless the customer has been with the same insurance provider for a number of years.

The same applies to a claim related to the building—a leaky roof, for example. Did the previous owner of the property make a similar claim? Could this new claim be a continuation of a problem not properly fixed, or does this appear to be a completely new issue with the roof? This level of insight into past claims can help determine the right course of action to expedite the claim, reduce unnecessary referrals to fraud teams and speed up claims processing times. The result is less cost for the insurer and a smooth and stress-free claims experience at a time in their customers’ lives when they will most appreciate it.

Of course, prior claims data has value beyond the claims function. It can help support accurate pricing at quote and renewal by again providing context for past claims—helping to ensure that individuals with prior claims are priced correctly and provided adequate cover.

As the volume of claims data grows, the insights we can derive will grow too to help understand more about claims losses. Perhaps most importantly, it will allow insurance providers to view the claims that happened this year in context of the unusual circumstances we have all found ourselves in, helping to ensure fair treatment at quote, renewal and claim.

How claims data can speed up the handling process 2Neill Slane is senior vertical market manager for claims and insurance at LexisNexis Risk Solutions in the UK and Ireland