In a recent post, we sketched the future of insurance: increasingly rapid change, artificial intelligence transforming the industry, and insurtech startups choosing to offer insurance themselves, with or without distribution partners.
One of the areas where technology has made its biggest promise is in claims. The value proposition for policyholders here is clear: a faster first notice leads to faster resolution. With speed and satisfaction as the goal, various claims technologies offer insureds a chance to blaze through the paperwork, get their check faster, and put an unpleasant experience behind them.
Lemonade is a good example. The insurance startup is using AI to smooth the process for claims approval: replacing "endless paperwork" with speed and transparency.
There's just one catch.
Policyholders aren't catching on. According to J.D. Power, auto policyholders are reluctant to report losses via insurtech tools such as mobile insurance apps, "despite a significant advertising and development investment." They would rather talk to a claims adjuster over the phone.
Even those who purchased their insurance online may not prefer to report the first notice of loss (FNOL) electronically, said Patricia L. Harman at Property Casualty 360. While 22 percent of auto policyholders began communications with their insurer online, only 9 percent choose to make their FNOL the same way.
It makes sense. Digital communications are fine for the day-to-day, but this isn't an everyday kind of situation—it’s a crisis. Do you trust the app to take care of you? Or would you feel better talking to a human? In Harman's words, "there are still certain areas of the claims process where the human touch is proving difficult to replace."
Once FNOL is past, however, policyholders' use of digital tools increases, J.D. Power found. Sixteen percent of claimants used mobile apps to upload photos of damages and get status updates. Those who did scored 33 points higher on satisfaction than those who did not, with individual satisfaction varying by generation.
It may be that within the claims process, the real benefit of an insurance app kicks in after FNOL. The apps are terrific for smoothing communications once the claims process has begun, making it easy for policyholders to offer important information, while keeping them clear on where they are in the process.
That said, consumer preferences are likely to evolve quickly. Those in generation Z, born between 1996 and 2010, currently make up 25 percent of the population and roughly half of them are now old enough to drive. This is the generation that grew up with smartphones, with no memory of a pre-digital world. While millennials don’t prefer to report their claims on an app, it may be more appealing to generation Z.
The FedNat Insured Web is a great tool for our insureds!
They like having a centralized location to view policy info, make payments, upload policy documents, and elect to become paperless to receive a discount.
The insureds also can file a First Notice of Loss for a claim and access exiting claim info. Silvervine recently enhanced the site which allows insureds to upload policy documents directly to their policy. The uploaded docs go directly into our workflows and save a lot of manual effort on our part.
From my visits with agents, the agents appreciate the app for the amount of time saved on having to download and attach photos directly to the policy.
The app can also reduce the amount of staff required for a busy office to fulfill underwriting requests for photos.
When training agents they are amazed at how quickly the photos attach directly to the policy. After taking photos using the app and before they make it back to their desk, the photo is already attached to the policy. They also like the ability to attach additional photos for pre-existing damage.
Customer Service is seeing an improvement with retention as the text message definitely triggers phone calls from insureds to make payments.
The insureds love the fact that we notify them on their phones because they state that sometimes they don’t receive their mail for various reasons.
The insureds are paying more attention to the texts then to their actual mail. We try to set all of our customers up on that option if we notice that they are not currently enrolled, as it builds great customer relations as well as retention.
As a company we have adopted the use of Policy Scan for all our policies, and our agents have adopted the use of the app as well.
Not only is it easy to use, there is also no more worrying about losing photos, having to store photos or photos being attached to the wrong policy.
With Policy Scan we have increased efficiency in our workflow and reduced our exposure on the risk.
Silvervine’s core administration solutions easily handles multiple carriers within multiple states, including accounting, payment processing, immediate policy issuance and endorsements.
What started out writing one product, one line in one state has now grown into mulitple products, multiple lines and writing in multiple states. We have over $95 million in annualized premium in-force and we expect to grow by 20% during the next year all serviced by Silvervine.
Silvervine was our insurance software system of choice when we started the company in 2006. Silvervine enabled us to begin business within a few months of licensing the company. Today, we are one of the top 20 homeowner’s writers in Texas and SIlvervine’s solutions have been an integral part of our success.