Digital Insurance Claims Can Speed the Process, and Save Money
Let’s say you have a fender-bender. Your car needs repair, and you need to file a claim with your insurance company. Do you use a mobile app, and file the claim digitally, or do you go about things the old way, and wait for a claims adjuster to fit you in?
You would think that today’s consumers would prefer the digital claims method, yet J.D. Power finds that few are adopting the technology.
According to a recent J.D. Power report:
Few customers adopting digital first notice of loss (FNOL) offerings: Nearly one-fourth (22%) of auto insurance customers begin their interaction with an insurer online, but just 9% of customers opt to report a claim digitally via the web or a mobile app.
Even among Gen Y1 customers, who are most likely to report a claim digitally, only 12% are taking advantage of FNOL technology, a number that’s increased just 2 percentage points since 2016.
Worse, overall satisfaction is 16 points lower (on a 1,000-point scale) among all customers who are using digital FNOL offerings than among those who report via phone.
With both loss claims, and insurance premiums on the rise, these technologies could be a big money-saver.
Andrew Robinson, writing for Insurance Thought Leadership website, reports that, “Fifty-six cents of every premium dollar is indemnity (loss costs). A further 12 cents is needed to assess, value and pay those losses. Given that two-thirds of the insurance industry economics are tied up in losses, it would be logical that much of the innovation we are now witnessing should focus on driving down loss costs and loss adjustment expense”
So, insurance companies stand to save a lot of money using digital claims reporting and processing. It stands to reason that consumer may benefit as well.
Not only could claims be processed – and paid – faster, but insurance companies could pass some of their savings on in the form of lower premiums.
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