The market is awash with projects intent on extracting delegated authority data from incoming bordereaux. One of the stand out common denominators I hear from across these projects is claims data sitting firmly at the back of the queue behind risk and premium data. Assurances are made by the system providers that handling the idiosyncrasies of claims data is top of their development road-map, and project teams promise that once enough progress is made with risk and premium then claims will get some attention; but as struggles continue in those areas, claims teams are kept waiting.
But the business imperative to get to grips with this data is compelling. Producing regulatory returns at the press of a button provides an immediate and tangible efficiency gain. Beyond this, claims teams can focus on performance management questions:
- What are we paying to different TPAs and what is the cost on average per claim?
- What % of open claims are peer reviewed by TPA X?
- How many claims are re-opened, and by who?
- What is the average time from claim notification to settlement for TPA Y?
- What is the variance between initial reserve and final settlement for TPA Z?
Claims teams can thereby gain a clear view of all aspects of claims management across their delegated book. Empowered with this data, more meaningful conversations can be had with TPAs regarding service improvement and lowering costs. And as a handy by-product, Lloyd’s minimum standards in this area are met…
And all of this is before we bring together claims and risk data to identify what risk characteristics are driving claims; allowing us to answer questions such as which roof types are driving windstorm claims in Florida, which profession category are causing a spike in claims in a PI binder, what is the chief cause of loss for property claims in South Carolina? For many books of business, this ‘underwriting 101’ activity of correlating claims to risks is simply not undertaken, as claims data is not in a usable format. With this in place, underwriters can shift pricing and product focus in real-time - maximising profitability in a soft market.
Putting DA claims data at the back of the queue until risk and premium is complete is not the right approach - both are critical to managing delegated authority books.
At Charles Taylor InsureTech, claims have always got equal billing with risk data from day 1 in our delegated authority platform