Decisions! Buy Bespoke or off the shelf Claims Software?
The world of claims software can be a confusing place to navigate. Not only do you need to work out what the best software is to suit your needs, you also have to decide whether to buy an off-the-shelf or bespoke software package.
This blog gives you a quick overview of the different options that are available. Whether it is a bespoke implementation of a claims management system or an off-the-shelf package it is the DOCOsoft view that in the rapidly evolving and fast moving claims environment adopting an off the shelf solution, while tempting, can be a false economy.
The Off-the-shelf software investment
Off-the-shelf software tends to be ready-made and available to a larger number of users typically paying a license fee to use the system.
The advantages are:
There is a perception that it is cheaper due todevelopment costs being spread across more users, which means paying much less than would be required to build the same software from scratch. It can be made available quicker,the development work has already been completed, so it’s more or less ready to go. Training costs may be lower if it is a commonly used package and users and claims practitioners may already be familiar with the system, which saves earning time and training costs.
If the software is popular, there may also be books and online communities offering advice to help technicians learn and resolve issues.
The disadvantages are:
In what is often a very complex and stressful “big ticket” claims environment, adjusters will have to compromise on their requirements. It is unlikely that a claims adjuster working in the world of casualty insurance across D&O, E&O and Professional Indemnity, for example, will find ready-made software that does everything they need, exactly how they want it to.
The claims system may be too complicated, trying to be all things to all people. The software may come with superfluous functionality because it is trying to meet the varied requirements of a large number of users. This can make the system clunky and cumbersome to learn and use.
There can be a lack of control and the vendor’s future plans and strategies may not align with the insurance business at a granular level. The fact is that as just one customer amongst many, it can be more of a struggle to get certain types of claims functionality implemented. That could be frustrating in the personable claims insurance environment, which thrives on face to face interaction.
Bespoke (custom-made) Claims Management Systems
A bespoke claims management system is custom made especially for the adjuster based on his/her feedback, to meet their specific business requirements.
The advantages are:
Tailored to the needs of the claims adjuster, thetechnologyis developed and built to meet experienced claims practitioner requirements, ensuring that they get software that is implemented exactly as they need it. Such systems are far more flexible and abespoke CMS can evolve over time to grow with the increasing burdens imposed, quite often in insurance, by regulatory and legislative change.
It would be a shame, for example, to bring in an off the shelf system that seemingly ticks a lot of boxes only to find that 24 hours after implementation a new pronouncement on Conduct Risk had made it redundant!
Bespoke software can be advanced further, growing and changing with the market, which is evident with the arrival of ECF2 Write Back, for example. As the claims competition may not have invested in such leading-edge, and intuitive software, it could easily give the business a strong competitive advantage.
Most specialist claims practitioners agree that an effective claims management system can make a company work more effectively, drive efficiencies, improve Return on Investment and have a positive impact on customer satisfaction levels, which is a particularly important focus for Lloyd’s, the FCA and the regulators.
The disadvantages are:
There will be higher initial costs with the early development of the claims management system,whichmay take some months to develop. However, in our view such considerations are more than outweighed by the negative potential delays and inefficiencies that arise with off the shelf packages.
If you would like to receive a demo of the new DOCOsoft Claims Management System that underpins Write Back, please give us a call. Because our solutions are bespoke, we often find that it takes a little bit of time (not too long!) to get a real handle on your needs, which is why we normally do it over a civilised cup of coffee! To learn more, contact our London office by emailing graham.sheppard@docosoft.com.