Using Technology to Resolve Auto Claims More Quickly

The ability to report claims via mobile devices and streamlining the payment process are among the advances in technology that have helped reduce the cycle time for auto damage claims, according to industry experts.

In addition, technology has helped with sourcing parts, explained Susanna Gotsch, lead analyst for CCC.

While the distribution of repair cost dollars has seen little change over the past fifteen years, a significant change has been the share of overall dollars spent on non-OEM (original equipment manufacturer replacement) parts. At the end of 2013, replacement part dollars was split at 63 percent OEM versus 37 percent non-OEM, CCC’s white paper Crash Course 2014 noted.

“We’ve seen non-OEM usage grow, with technology making more of that data available real-time. So people know what the inventory levels are, can reserve the part at the time of the estimate, so that when the shop goes to order the part, it’s sitting there waiting for them. A lot of technology has facilitated some of that whole process in terms of sourcing parts,” Gotsch added.

Other areas of technology can impact an auto insurer’s bottom line.

In a video interview with Claims Journal, Ryan Harrington, director of insurance services group at CCC, explains how auto insurers can save time and money by using big data in resolving claims.

He described some ways carriers are using technology to save money:

• Carriers are reporting a savings of $100 to $125 per claim by having an insurer take a damaged vehicle – provided it is safe to drive – to the shop directly for an estimate rather than having to send a field appraiser to do an inspection. The estimate can then be transmitted directly from the shop to the insurer. If the vehicle is considered a total loss, insurers are saving money by having the vehicle towed directly to a salvage yard rather than to a shop only to have it towed again.

• By reducing the time it takes for a loss notice to be reviewed and entered into a claims system, carriers are reporting a savings of $95 to $195 on storage fees and $50 to $150 in rental car charges per claim.

In both personal and commercial auto lines, carriers are offering first notice claims reporting via mobile applications, said Karlyn Carnahan, research director at Celent.

Besides new initial claims reporting options, Carnahan said that the claims process is also benefiting from the latest technology. She cited Allstate and Esurance as examples of carriers that allows claimants and insureds the ability to upload a photo or video of damage and receive an estimate after adjusters have reviewed it.

Scoring during the first notice of loss to assess complexity and to make automated adjuster assignments using business rules and workflow is another technology being implemented by carriers, particularly in personal and in worker’s compensation lines.

Insurers are using mobile devices, e signature, and in car printers to provide immediate payments at the time of the initial visit.

“This isn’t like the old let me write you a draft,” Carnahan said. “This is actually where the adjuster has entered into the claims admin system, issued a check out of the admin system that has depleted a reserve, and actually issued a check in the car. It’s very different than the old time draft.”