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Evolving Insurance Claims Arena

By Gary Sullivan, VP-Property & Subrogation Claims, Erie Insurance

Gary Sullivan, VP-Property & Subrogation Claims, Erie Insurance

Insurance companies have been focusing on technology advances, which have been robust and vigorous, and in recent years even more closely on claims handling. Claims, where the rubber meets the road of customer service at their time of need, is in for major disruption. Insurance companies used to compete with each other on price or service or both. Now service efficiencies that occurred in other industries are changing customer expectations for insurance claims.

As a result, the experience for customers and adjusters will alter significantly. New ways of doing the basic job of investigating coverage, liability and damages will impact claims professionals. Disruption will occur in three phases: tools, process and people.

Tools: New methods of gathering data that allow informed decisions are rapidly changing. The biggest impact is in drone technology. With recent changes to allow for flying drones commercially, companies can operate within certain perimeters efficiently. This will allow adjusters to safely inspect exterior damages from the ground.

As an example, in 2015 we at Erie Insurance took the first step toward changing how insurance claims are handled when we moved from the testing phase to actually using a drone to assist with a property damage claim.

Earlier in 2015, we became one of the first insurance companies to seek and receive permission from the Federal Aviation Administration to use drones commercially. In the context of the claim, the drone was used to inspect the roof of a customer’s home after it had been repaired following ice dam damage. We then deployed the drone for a second, unrelated claim that involved a tree falling on a house. We used the drone to capture detailed aerial images of the roof damage and compare it to the adjuster’s original photos after the tree had been removed.

"New ways of doing the basic job of investigating coverage, liability and damages will impact claims professionals"

Put simply, we see drones as a happy marriage between technology and the human touch. We can use them to do what they do best—get clear and detailed images of property damage in difficult to access areas. That, in turn, enables our claims people to do what they do best—take great care of our customers with personal service, and helping them get their lives back to normal as quickly as possible.

Hardware technology improvements are also occurring. Cameras are getting smaller and allowing for larger infrared and video, which changes how an investigation can be completed. In the future, customers may be able to participate in their claim as improvements continue to enhance images captured through smartphones.

Process: New entrants in software solutions for claims are impacting service to customers. New estimating platforms allow for field claims handling and immediate settlement if a claim warrants such service. Also, strides are being made to allow customers to play a larger role in their claims. Significant investments by insurance companies are occurring in the IT business world. Another aspect is providing transparent technology that allows customers to see the progress of their claim from start to finish. Solutions are available for customers to assist in their claim by providing documents directly to the insurance company.

People: What won’t change is the need for insurance claims professionals to be highly trained and skilled. Vehicles are changing rapidly with technological advances and appraisers need to stay current with repair techniques as well as evolving legal issues and cases. Property adjusters, as noted, will have new tools to help them determine coverage and prepare damage estimates.

There is an underlying sea change going on in claims handling. Processes and tools which impact customer expectations are changing. What won’t change is the need for smart people to decide coverage, liability and damages.

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