How the London Market’s Wealth of Claims Data Can Deliver Massive Insights

author by Paul Jones time Feb 04, 2021

This is the second blog recording comments made at the recent Insider London Live event. DOCOsoft moderated the claims panel, which focused on a range of topics that will be of interest to Heads of Claims in the Lloyd’s and Company markets. In this section of the panel, the speakers turned their attention to the subject of data insights.  

There is a wealth of claims data with massive insights we can deliver. We should move ourselves more into advisory roles to share that knowledge with a client. This is all about risk mitigating and risk transfer. This is also where claims and underwriting can work together a lot more than maybe it's been done in the past. What we have failed to do is bring our clients along the journey with us. We have not always done a brilliant job of explaining what it is that we are selling, and that needs to improve. 

Panel quote 
“What we find is particularly useful to underwriters is the pricing and understanding of loss ratios. By having live data and real time information about your claims, heightened technology is about being able to analyse in a live environment. What is happening to your client and what their claim experiences is gold dust for underwriting in terms of not having to wait three months, six months to suddenly find out what the last development or experience has been. Get it early, listen to your claims people and allow them to be able to impart that knowledge to you in an advisory way.”

Speak to your claims person before you receive the claim itself. Don't wait for the claims to come along. Then ensure you've got your claims operation in close proximity with your underwriting department rather than set them in separate departments. Finally, recognise claims within your organisation as well.  

Panel quote 
“I report directly to the, to the CEO of the business, not necessarily a chief admin officer or somewhere further down the organization, which will show you a lot about an organization's value in terms of where they see claims within the business itself.” 

The advice from the panel was talk to your claims teams about the claims that have been denied, and really get underneath why they've been denied. That might be a policy opportunity. There might be an opportunity there to expand the coverage or they may be gold nuggets in there around how you could offer a different, insights that are buried, and worth looking at. 

How do we ensure you’re future proofing your claims operations? 

When I think about future proofing, I really care about survival. It’s a bit of a paradox that we all want to be different. But in our marketplace, operational efficiency still comes mostly from shared market services. I think some of those have, in some ways, become less efficient, over time, and less effective. I give the example of how we conduct TPA audits as perhaps an example.” 

In terms of future proofing there are a few things that we need to really focus on, and one of them is collaboration. In terms of the different components of Lloyds, of the company market, and working together in more intelligent way about how we agree about what our common interests are and then accepting that actually we have independent individual approaches to doing things that might be outside of those areas of common interest. 

A huge amount of good work has been done in the marketplace, particularly by Lloyds, over the last five to 10 years in elevating standards, but we need to do more. We've got to keep raising those standards, particularly in the area of delegated authority. This marketplace has so much delegated authority within it. We need to get better at raising our standards and improving the way that we provide that service to clients and the way that we actually deal and govern delegated authority. 

Panel quote 
“There needs to be more data orientation, more investment in tech savvy people. That's an issue for us to address as an industry.” 

What is interesting about the sets of questions that that made up this panel session is that probably five or six out of these were all operational. Very few of them dealt with technical claims capability. There is a worry that claims people are becoming so operational that they're losing sight of the technical expertise that was the foundation upon which many market claims practitioners all grew up. Let's not lose sight of the fact that these are complex products that we are selling, and we have to hire technically proficient people who are going to really drive through the changes that we need to make if we're going to survive. 

What kind of technologies can add meaningful value to the market as opposed to implementing change for the sake of it? Is there room to innovate, without the need for new technology? 

Panel quote 
“For somebody who's been in this industry since the 1970s, it's interesting to look at the evolution. It really was focused around your technical capabilities in terms of your understanding of the contract, the handling of the claims. Then we went through a period I think where communication became a big part of it as well. The ability to share knowledge and experience is vital. Claims is one of the few aspects of the business where we actually touch the client, we actually get to meet and communicate with the client so we become the face of the business. Now you also need the ability to understand the digital but you still need that those technical skills, whatever the particular area or class you're going to focus on.” 

As the panel drew to a close, it was agreed that the people factor is critical. 

“I think that we should be using technology to give the clients what they need, which is some money in their evacuated hotel rooms rather than waiting for interim payments! But that aside, if you say the definition of innovation is something that creates value, we don't need technology to just be a facilitator and accelerator, it's humans that create value. So you come full circle, it is about people.” 

The final question asked what is the best innovation small or large that people have seen recently in claims?  

“SCAS when it comes out properly, as a market, so we can all concentrate on things that we can actually transform, as opposed to dealing with the transactional and having people pressing buttons. The Small Claims Automated Settlement pilot has proven that there is an opportunity to robotically handle small claims or small transactions.” 

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