According to a study by consulting company Accenture, 83% of German insurance companies believe that their industry will experience digital transformation over the next three years. A study by St. Gallen University forecasts that the interaction between the customer and company throughout the customer journey will for the most part be digital by 2020. Simplify claim processes, improve digital interaction points or unify communication over all interaction points – these are the important levers for increasing the efficiency of customer processes. Digitalization is already more than a trend that will reach the insurance industry in the distant future. Rather the revolution has already started.
The use of data analyses essential for this has high potential for creating added value to the company. But it has been demonstrated that data analyses are not plug-and-play solutions. According to a KPMG study, there is major dissatisfaction with the success of the models. For example, only 15% of the companies surveyed are satisfied with their success in detecting fraud risks.
The use of advanced analytics and AI should therefore be closely associated with the question of operationalization. Models that cannot be implemented in practice are still frequently developed.
Keeping an eye on transparency and user orientation
In order to strengthen confidence in advanced analytics in the organization, sub-processes should be selected that promise high benefits and take the pressure off administrators. They must be homogeneous such that the results are not completely lacking in transparency. In addition to the definition of clearly defined usage areas, the choice of model in particular plays an important role. Where the administrator must continue to work with the results, e.g. when detecting insurance abuse, the model should have higher transparency than for completely automated processes.
At Arvato Financial Solutions we have therefore chosen the approach of focusing on the interaction of process expertise, analytics expertise and digital decision excellence. At the start the focus is on digitalizing the actual analysis process. Segmentation into the supported sub-processes is the basis for the digitalization strategy.
Potential sub-processes in the claims process include for example:
Many of these processes can be perfectly controlled using high-performance rules engines and the learning expert system RiskShield 360°. RiskShield 360° is a hybrid decision engine that also offers the opportunity to integrate analytical models. The system has not only been successful for years in detecting fraud patterns, the rule-based execution of business processes can also be extended at any time using machine learning and AI processes.
This interaction enables data analyses and AI models to be developed not only as an aim in and of itself but also to be operationally integrated into the processes. The targeted application of innovative technologies combined with tried and tested rules management ensures acceptance with employees and actually slims down the business processes. This ensures the customer is satisfied.
Head of Consulting and Solutions Insurance Claims at the Risk Management division | Arvato Financial Solutions