In this insurance claims analytics article originally posted in Carrier Management, we discuss how claims and legal executives have never felt more pressure to focus on the future.
You’re constantly being told to innovate.
You keep hearing it: If you don’t use technology to predict the future, industry outsiders are going to take over the insurance industry with their powerful software. You also keep hearing that one day Google and Tesla will announce product launches that shake up the entire industry….
Rather than try to think like Google and Tesla, you should take a step back and think how you might be able to compete with them. What’s your advantage? What do you have that those companies do not?
You have data.
Rather than focus on the future, focus on the past. Turning information into intelligence is no easy task, but it may be your only chance at survival in this rapidly changing insurance industry. Forget about predictive analytics and cosmic models. Let’s start with the powerful advantage you have that you can and should start exploiting today.
Descriptive analytics answer one simple question:
Descriptive analytics are easy in theory but hard in application. As an insurance company executive, you salivate at the opportunity to examine descriptive analytics. Unlike with predictive analytics, you don’t need scientists and experts to create a magical algorithmic model. All you need are the smart insurance people you already have working for you. Using descriptive analytics, you can analyze past data, which can translate into you saving millions of dollars by handling claims differently, hiring different employees, and selecting different vendors.
You might be thinking that your company already has descriptive analytics. However, this is where most companies falter. Sure, you have some general performance metrics that you review on a routine basis, such as claim durations and average indemnity and expenses.
Yet to innovate using descriptive analytics, you need to dig much deeper.
Turning Expenses into Assets
If your company can turn all of its latent data into actionable descriptive analytics, you can answer many of the important questions:
- When is the claims process most likely to break down?
- Can we do anything to prevent insureds from hiring attorneys or is it a demographic trend?
- Which adjusters and engineers lead me to the least overall cost, including indemnity and expense?
- Which attorneys get me the best combination of results and expenses?
- What are the emerging issues we see creeping up in the last six months, and how can we mitigate them?
To compete with the Googles and Teslas of the world, you must have the answers to these questions. Forget about trying to build the insurance company of the future. Instead, focus on how you can use your biggest asset – your data – to overcome your competitors.
To see this applied, check out our CaseGlide Resources page to learn more about the latest insurance claims litigation case management advancements.