Crash Course: How Industry Trends Are Colliding with Auto Insurance Strategy

Change is in the air. CCC Information Services just released their 2016 Crash Course Report, and the conclusion is clear: Auto insurance is at an inflection point, driven by a rise in accidents as well as a flood of new tech. Here are the highlights.

Claims frequency and losses are rising

Unemployment is down. Gas is cheap. Vehicle sales are strong. Miles are up. At the same time, weather patterns have been severe. All of these factors directly correlate to an increase in car accidents.

Tech is reshaping customer expectations

Meanwhile, to keep pace with digital trends, businesses are incorporating tech to an ever-greater extent. “With technology providing greater speed and transparency, businesses are using mobility, big data and analytics to improve processes and products that cater to a broader array of customer demands,” said the report.

These innovations aren’t just helping businesses improve efficiencies. They’re also shaping customer expectations and driving waves of change – among them, “a changing vision of what it means to drive a car.”

Cars are changing, will continue to change

Case in point: Today’s vehicles are IT devices bringing connectivity, entertainment and information to those who use them. As a result, “more information than ever can be transmitted from the vehicle to insurers, manufacturers and approved third-parties,” said the report.

This, more than anything else, signals the inflection point that the industry is facing. The information that vehicles collect provides immediate, actionable data at the scene of an accident, informing every decision that follows from there.

Tech is reinventing the claims process

A few key points:

1. First notice of loss: “Imagine a process where upon impact, your first notice of loss (FNOL) team is notified that a policyholder has been in an accident, and the facts of that accident pre-populate a loss intake screen,” said the report. “Gone would be the need for Q&A scripts to obtain those already captured details, and in their place would be interactive FNOL, a process that enables your team to proactively manage the accident scene and consequently provide even better customer service, and achieve better outcomes in terms of claim resolution speed and accuracy.”

2. Repair or total? With predictive analytics, an insurer can speed some of the most critical claims decisions, among them the determination between repair or total. This “can result in fewer days to claims resolution, and potentially fewer fees incurred by towing the loss vehicle to multiple locations.”

3. From resolution to retention. Efficiency and accuracy are two results. A better customer experience is another. “The numerous components, steps, and players involved in a claim can be confusing, disconnected, and subsequently dissatisfying,” said the report. To close the satisfaction gap, the process must improve; so must communication.

Bottom line? The auto insurance industry is at a claims apex. How well (or badly) claims are handled bears an undeniable impact an insurer’s profitability, for better or worse. Now is the time to get a claims and analytics platform to equip you to identify and respond to trends like these in real time. Silvervine Software can help. Download our “Losing Your Legacy” report to learn more or request a demo.