Does your insurance claims processing system work for you?
In the fast growing digital world, technologies are becoming a part of many aspects of our lives – often replacing laborious activities with advanced technologies.The insurance industry is no exception. Insurance companies who implement more advanced technologies are leading the market. These days technology can speed up the insurance claims processing time substantially.
The myriad of technologies available can be quite daunting, so which area of business should insurance companies invest in to get the best return on investment (increase performance, decrease operational cost, decrease fraudulent pay-outs and gain a maximum return on investment)?
To answer this we should break down the insurance claims process.
1. An operator records the claim details and logs it in the system.
2. The floor checks the claim for errors, gathers further information where required and assesses whether the claim should be paid, assessed by a claims assessor or sent to special Investigations based on the nature of the claim.
3. The claim is then sent on to be paid out, assessed or investigated.
Often there are additional levels of assessment.
The assessment of claim channel is fulfilled by the floor and most insurance companies use some form of LOB software (Line of Business), which digitises and facilitates the communication channels of this process.
According to Business Report the SA Insurance Association estimates that local insurance fraud is in line with international trends and that fraudulent claims amount to about 30 percent of the claims submitted annually.
Insurance fraud costs the local short-term insurance industry millions
Insurance fraud costs the local short-term insurance industry between R2 billion and R3 billion a year, which results in higher premiums for all insurance clients.
This is the main reason why insurance companies heavily invest in claims assessment and the investigation of fraudulent claims. It is however a major cost, and improved return on investment for claims assessment is an ongoing struggle.
But thanks to the Cognitive Era, the world of Big Data and Predictive Analytics the significant costs of initial assessment can be greatly reduced as well as the ROI of claims investigation improved.
Insurance Claims Segmentation solution predict fraudulent claims.
Intelligent Claims Segmentation solution will prevent short-terms insurance fraudulent claims in Africa OLSPS Analytics has developed a Predictive Analytics Intelligent Claims Segmentation solution to prevent short-terms insurance fraud.
OLSPS Analytics Claims Segmentation Solution enables insurers to automatically push claims down the appropriate channel (segment) based on the probability of a claim being fraudulent, or simply advise the floor on probability to save assessment time. In other words, a low-risk claim can be automatically sent to the insurer’s Fast Track Route, while a high-risk claim can be directly sent to a Special Investigations Unit (SIU) with a higher success rate.
OLSPS Analytics Claims Segmentation solution sits on top of any existing insurance provider LOB system and provides a means for intelligent pre-segmentation (prior to assessment at first notice of loss).
OLSPS Analytics Claims Segmentation Solution helped to prevent fraudulent claims worth R 17 million
OLSPS Analytics has prevented R 17 million in fraudulent claims for the biggest short-term insurer in South Africa, Santam. The major return, however, is in the saving of costs by fast tracking the majority of claims. With more than 650 000 policy holders the company enjoys a market share of more than 22 %. OLSPS Analytics Claims Segmentations Solution has improved customer service by enabling legitimate claims to be settled within an hour, more than 70 times faster than before. This solution was powered by IBM SPSS Software.
Watch Video about success of Santam Claim Segmentation Solution:
After the success of the Claim Segmentation solution implementation for Santam OLSPS Analytics implemented a similar solution for insurance provider Mutual and Federal using SAS software. This implementation took about 8 months and the results will be clear in the future.
The great success of our Intelligent Claims Segmentation solution lead OLSPS Analytics to develop our deployment platform OLSOLV which allows us to implement solutions a lot faster and simplifies the process for insurance companies, even those without their own set of data scientist.
OLSOLV is a cloud based platform and can be reached from anywhere in the world. The basic dashboard of OLSOLV allows anyone to use our Insurance Claims Segmentation solution – with no data science skills required.
Please contact us for a demonstration of our Insurance Claims Segmentation solution on OLSOLV.