A great summary of what is happening in the world of insurance claims transformation from Alessandro Paoli at Zurich.
With fewer, more severe claims driven by advances in technology, insurers need Agility and the ability to deal efficiently with complexity.
Operating models are changing, driven by the tech giants (Amazon, Uber, Apple). This requires new 100% customer-centric, data driven models, powered by AI.
Reduced underwriting profit & investment income means insurers have to be more operationally efficient in their existing models.
So, to sum up the current requirement in Claims Transformation:
Claims Transformation requires you to be completely agile (release software every week/day), completely customer-centric (maximise value for each customer individually) and more efficient than you have ever been.... all at the same time!
Sadly, most insurers are just replacing their monolithic Claims Administration Systems with newer ones written in Java. It costs £0m's and they are no further closer to these goals.
It is possible though - and some companies are doing it. They are creating completely new technology platforms designed to do everything, all at the same time.
Claims transformation is being pushed to the top of insurers’ agendas thanks to a changing marketplace, heightened customer expectations, and pressure to reduce costs, says Zurich’s head of claims strategy. The market itself is “totally changing,” according to Alessandro Paoli, who said that there has been an overall reduction in the frequency of claims, but an increase in severity. That’s thanks to technology, helping create more preventative measures. Customers too are completely changing in both habits and expectations, Paoli said, pointing to disruptive firms such as Amazon, Airbnb and Uber – all of which have had an impact on the way that customers transact and the way in which they want to interact with service providers. The pressure of profitability is also squeezing insurers.