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Weathering storm and critical events with resilience claims operations

4 min read

It’s no secret that Claims is the most critical service in the insurance value chain.

With critical weather events happening on a more frequent basis with higher severity, the need for improving the resilience of claims operations has never been greater. The insurance industry is already finalising the readiness to enhance operational resilience to meet regulatory requirements to mitigate service disruptions.

In the case of claims, there are two causes of disruption:  a surge of claims, usually because of global events affecting many people (e.g. bad weather conditions) or unavailability of staff, as we have seen during the Covid-19 period.

In both cases, technology is able to offer meaningful solutions.

While being the key to efficiency with a potential to absorb surges, digital processes unlock significant benefits yet can become obsolete and short-lived Proof of Concepts if they are not compliant with the internal requirements.

Building operational resilience is not necessarily translating into a two-year project. Besides, Covid-19 taught us to be smarter in finding new ways to deliver value to the end insurance user. Let’s explore through a specific process use case such as claims how operational resilience is achievable with reasonably low effort.

Increasing surges demand resilience

Claim surges can vary from weather to systemic events, BI (Business Interruption), Travel Disruption. Let’s take a look at how operational resilience can specifically relate to weather surges.

Extreme weather is changing the landscape of our lives as well as how insurance processes function and perform. It is now two years since Coronavirus disease began changing our social environment, with more people working from home, unable to meet face to face. Such an unprecedented scenario called for new ways of making business and increased the need for more digital interactions, especially self-service and on-demand services.

The digital “forced revolution” was not the only noticeable event during this couple of years: also, extreme weather occurred on the four corners of the globe. In Europe, the floods in Germany were dramatic sweeping lands and were followed by hail and tornadoes creating damages to cars and homes. More recently, storm Arwen brought a lot of snow and its strong winds caused trees to fall onto cars, resulting in the deaths of some drivers.

Extreme weather events draw a very tough scenario for insurance businesses, with many complications to deal with. Roads become unusable, claims handlers can’t go to work and call centres perform below capacity while the number of inbound claims is skyrocketing. This is a perfect explosion cocktail that professionals are dreading.

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More than words

In late 2017, Spixii was approached by Zurich UK to deploy a quick and effective digital solution to allow claimants to notify their claims online. The journey would follow a conversation like the claimants would usually have with a claim handler over the phone.

The solution was deployed in 3 weeks and went live in early February 2018. If you remember this was exactly when the Beast of the East, one of the heaviest snowstorms of recent years, hit the north of the UK.

Starting multiple conversations at the same time, the conversational process leveraged a chatbot interface able to absorb with ease all the claims first notifications of loss, immediately relieving the claimants from their emotional distress and informing them that the claims resolution process was underway. The case study is available at this link, if you are curious to see how this solution managed to be selected and win multiple awards including the prestigious British Claims Awards.

Since then, Spixii evolved its platform to meet the more demanding needs of digital, operation and compliance functions. This came also with the realisation that helping insurers to receive claims online is good, but accelerating the resolution process is better.

That’s why we focused on integrating the conversational processes created on the Spixii platform with core claims systems using API functions. Such an approach allows claims information to be captured, validated and passed straight to policy systems, excluding from the claim process unnecessary human rekeying with all the associated manual errors.

Moreover, integrations open the door to other benefits such as allowing a claimant to ask for information about the status of his or her claim through a chatbot conversation. The conversational process behind the chatbot is then querying the claims system and providing the answer to the claimant.

To share a glimpse of the latest developments of the platforms, compliance teams can now sign off a version of the conversational process and track every change since that approval. It allows digital and operations teams to innovate at a fast pace while keeping their colleagues from compliance happy and comfortable.

The way forward

We have seen how emergencies demand operational resilience. Digital innovation and disciplined compliance can and must work hand in hand to make this a reality.

Now it is time for blueprinting activities as harsh winters represent the litmus test for insurers. Our experience shows how investing less than a month of preparations can lead to outstanding outcomes both in terms of superior customer experience but also in terms of operational control and performance. This happened to every client we have been working with.

In the words of Seneca,

 

Luck is what happens when preparation meets opportunity.

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