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Claims must embrace tech to spur business, attract talent

Posted On: Mar. 14, 2019 4:59 PM CST

insurance claims

ORLANDO, Fla. — Insurance claims professionals have an opportunity to embrace technology to drive advances in their business and attract fresh talent to succeed in tomorrow’s marketplace, a panel of experts said.

As the use of technologies such as “internet of things” and artificial intelligence accelerates, the industry needs to take the chance to use it in order to progress, they said Thursday during a panel discussion at the Claims and Litigation Management annual conference in Orlando, Florida.

“We manage risk and sometimes we try to manage right down to zero. We can’t have progress without taking risk. The industry is starting to adapt and innovate,” said Peter Miller, chief executive officer of The Institutes.

While the industry has used data for a long time in a lot of creative ways, some companies are using technology faster than others, he said.

“Some are using it strategically, some episodically or tactically. If we are not doing it in the context of a bigger strategy, we are missing an opportunity,” Mr. Miller said.

“Is the industry changing fast enough? That remains to be seen,” he said.

While technology makes it easier to do business and drives greater efficiency, it will have a limited role unless changes are made in how dispute resolutions are handled, said James Scalise, senior vice president, chief claims officer at United States Liability Insurance Group.

“From a claims perspective, we have our feet in two places. We have our feet in the administrative and business side and on the dispute litigation resolution side,” said Mr. Scalise.

On the industry side, technology is playing a role with big data and having a major impact on underwriting and how to write risk, but the other side of the equation is dispute resolution and litigation, he said.

“Until there’s a fundamental shift in how we handle dispute resolution in this country and others,  technology will have a limited role,” Mr. Scalise said.

“The determining factor from the claims perspective is how you use your noodle. Until we get to a point where we’re going to supplant that with technology, you won’t be able to do it unless the litigation dispute resolution side changes,” he said.

Technology is having an impact on a lot of different areas in commercial lines, said Tracy Ryan, chief claims officer, Liberty Mutual.

Technology makes it easier to do business and also has an impact within the claims organization in terms of “how we are building efficiency and using things like robotic process automation and automation to make our people and the work they do more efficient,” Ms. Ryan said.

As technology makes the industry faster and smarter, companies need to think about “how do we use AI and predictive analytics and all that data and compute it at a speed that humans can’t serve up,” Ms. Ryan said.

How customers are using technology is another important consideration. “There are a lot of customers investing in wearables and sensors. How do we insert that in the claims process?” said Ms. Ryan.

“As outside counsel, the hardest challenge you have now is learning your client and understanding what they’re doing with technology and data in order to be able to serve them and given them solid legal advice,” said Jamie Cooper, executive director claims litigation, United Services Automobile Association.

The challenges for outside counsel around data have got to start with “know your client, know where they are in their data journey and then be able to speak intelligently to it,” she said.

Companies also need to be smart about the use of technology in the courtroom. “It’s a really big investment so we need to understand when to make the investment to get a great outcome,” Ms. Ryan said.

While technology is impacting a lot of companies in the sector, the claims industry is still a people business, the panelists said.

Despite concerns about whether jobs will be in jeopardy or replaced by robots and artificial intelligence, the reality is the vast majority of what the claims and legal profession do is high-level critical thinking and unlikely to be replaced by any form of artificial intelligence soon, said Nelson Tavares, senior vice president, claims, W.R. Berkley Corp., who moderated the panel.

“In some respects, the alienation will be by not embracing tech, which will hinder your ability to do what you’re doing and do it better,” he said.

“There’s technology that makes you more efficient, and there’s technology that can make you smart. On the efficiency part are there tasks that can go away? Yes, but it will free people up to do things they need to do,” Ms. Ryan said.

“It’s that technology that makes you smarter that is exciting,” she said.