As technological innovations redefine the insurance industry, companies are increasingly digitizing various operational aspects of their business to gain new competitive advantages and maintain existing ones. For many insurers, this comes down to improving the customer experience through automation and improving internal processes – many of which can be manual, human-driven efforts. By leveraging the latest digital tools and technologies, insurers are better positioned to remain competitive. To this end, direct claims handling is becoming increasingly prevalent among insurers seeking to improve their customer acquisition and retention rates in the face of increasing competition.

What is direct claims handling?

Direct claims handling allows insurance companies to process claims automatically without human intervention or activity. Since manual work is avoided through automated processes and electronic transfers, issues such as prolonged/stuck claims processing and errors are drastically reduced; in turn, insurers can offer their customers consistently faster and more convenient experiences.

Enable direct processing of compensation claims

For the customer, direct claims handling means faster, more responsive service during the claims handling process. For the insurer, many technologies come into play to reduce manual tasks and extraneous human intervention. For example, companies can implement strategy to automate various aspects of the claims process and organize claims data for faster processing. In cases where crucial claims data is missing, AI-powered chatbots can be deployed to contact parties to obtain the missing information automatically. Billing claims can also enable insurers to create more optimized models for making claims decisions, considering historical data from previous settlements and claims. By applying insurance claim algorithms to the claims handling process, insurers can deliver better outcomes and more accurate claims decision-making.

Big Data to inform automated claims processing

Digital innovations continue to redefine the insurance landscape. By enabling the faster collection and processing of massive amounts of diverse and complex data (i.e., structured and unstructured data), big data has transformed the docs of insurance processes—from underwriting and pricing to marketing and sales, account management, revenue cycle management billing and, of course, claims management.

5 Ways Direct Claims Handling

Here are five ways direct claims handling can enable insurers to deliver more personalized, first-class customer experiences.

1. Scalable customer response capabilities and services

During hectic periods and peaks in claims activity, insurance companies burdened with manual processes and human-driven efforts may be unable to meet customer demands for responsive communications and, ultimately, timely claims settlements and closures. These negative experiences increase customers’ risk of switching to another insurance company; therefore, straightforward claims handling is crucial to helping insurance companies meet their customers’ demands and expectations.

2. More accurate claims decisions and settlements

Since automated processes are an integral part of direct claims handling, manual data entry efforts, and the resulting data entry/processing errors are substantially reduced or even eliminated, resulting in reduced settlement risk and overall claims processing costs/expenses, not to mention a more streamlined claims and settlement process for the customer.

3. Improved transparency in end-to-end claims handling

Direct claims handling increases transparency and visibility, simplifying and streamlining the claims processing workflow. With little to no human intervention and/or personalized handling involved, customers are more receptive to the end-to-end claims handling process, which leads to increased trust and improved customer relationships.

4. Faster processing and resolution of compensation claims

With direct claims handling, less complex cases and claims with basic information can be handled immediately and/or more quickly, advancing the claims handling workflow to meet or exceed customer wait time expectations. With automated and shortened claims handling processes, customers maintain a more positive user experience, ultimately leading to more policy renewals and referrals.

5. Increases staff efficiency and productivity

Despite technology-driven automation, insurance professionals remain a critical component of the enterprise; suffice it to say that your efforts should be integrated where they count most and not where excessive manual/repetitive work (e.g., validating information, collecting data, conducting surveys) can result in lower staff productivity and ultimately a negative impact on the customer experience. Direct RCM billing management claims allows insurers to apply human efforts to personalize the customer experience further.

Improve customer relationships and experience.

In short, direct claims handling enables insurance companies to improve the customer experience by streamlining internal company processes—specifically, automating routine, human employee efforts and accelerating the end-to-end claims workflow. To learn more about how direct claims handling can improve customer relationships and drive more business, please contact WMB.