Post on 23-May-2020
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Claims Corporation NetworkClaims Management in the ‘Digital Age’
Cees Werff, President & CEO
International Insurance Forum, 15th February 2017, Vienna, Austria
15 February 2017
InsurTech: Motor insurance digitalization in the CEE
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Claims Management in the ‘Digital Age’
The ‘Internet of Things’ has revolutionized many traditional markets…
….and many more (postal service, movies etc.), but also automotive industry (e.g. connected cars)
2 The Music IndustryA local record store and CDs: music is readily available on all sorts of platforms
3 Newspaper and Print MediaUsed to be primary source of information, now truly yesterday’s news
1 Travel AgenciesBooking a ticket, a hotel, a car: it is all done online with complete price transparency
4 (Electronic) RetailersOnline retailers have reshaped industry with low prices and free delivery
5 Taxi/Mobility marketTrend in behaviour to preferring paying for usage over ownership (less emotion)
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Claims Management in the ‘Digital Age’
…. And The Digital Disruption Has Already Happened …….
• World largest taxi company owns no taxi’s (Uber)
• Largest accomodation providor owns no real estate (Airbnb)
• Largest phone companies own no telco infra (Skype, WeChat)
• World most valuable retailer has no inventory (Alibaba)
• Most populair media owner creates no content (Facebook)
• Fastest growing banks have no actual money (SocietyOne)
• World’s largest movie house owns no cinemas (Netflix)
• Largest software vendors don’t write the apps (Apple & Google)
• Best TPA’s owns no vendor service network (CCN)
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Claims Management in the ‘Digital Age’
…and auto transformation will profoundly impact insurance as well...
Toda
yTo
mor
row
Futu
re
• Car technology advances every day:• Telematics enabled policies• Software more advanced than air plane
• Changing altitude: ride sharing is becoming increasingly conventional
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• Importance digital services grows significantly
• Ride sharing has a rising impact on the automotive industry: estimated negative impact of 1% on unit sales in 2021
• Driverless cars will reduce the potential of traffic fatalities by 90%
• Battery costs expected to decrease by 60% • Up to 30% additional automotive revenue is
estimated to stem from data driven services and on-demand mobility(1)
(1) Currently cars are parked 92% of their lifetime
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Claims Management in the ‘Digital Age’
…making InsurTech a top priority on executive board agendas
Technology Changes
• New options for customer interaction
• New ways of assessing and managing
risks & claims (Big Data, Internet of
Things)
• Challenging IT Legacy systems
Consumer Changes
• Shift to online channels: orientation,
comparison, review and actual
purchasing
• Increased need for consumer-centric
products
• Not willing to pay for face-to-face
services
Regulatory Changes
• Solvency II: requires substantial
investment in improving systems
• Conduct of business: trend toward
enhanced customer protection
• Data protection
New players will take over:e.g. Lemonade
Outsourcing non-core activities to ‘specialists’
How to keep ‘digital’ generation satisfied?
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Claims Management in the ‘Digital Age’
Source: Insurance Europe
Gross written premiums (€bn) Nominal growth (%) 2013 2014 2015 2014 2015
Non-life 338 339 346 0.3% 2.4% Motor 133 130 133 -1.8% 2.2%Property 91 91 93 0.0% 1.9%General liability 33 34 36 1.6% 5.5%Accident 34 34 34 -0.1% 2.1%Other non-life 47 50 50 6.0% 1.7%
Benefits and claims paid (€bn) Nominal growth (%) 2013 2014 2015 2014 2015
Non-life 211 222 233 5.2% 4.3% Motor 99 100 103 0.2% 3.1%Property 57 52 55 -7.8% 4.4%Other non-life 55 70 75 27.5% 5.9%
Density (€) Nominal growth (%) 2013 2014 2015 2014 2015
Non-life 572 570 581 (0.3%) 1.9% Motor 225 220 223 -2.2% 1.4%Property 154 153 156 -0.6% 2.0%General liability 56 57 60 1.8% 5.3%Accident 56 57 60 1.8% 5.3%Other non-life 81 83 82 2.5% -1.2%
Non-life premiums have increased mostly driven by a surge of general liability premiums…
…and the average amount per capita spent on insurance (density) has risen as well…
…but benefits and claims paid outgrow both revenue metrics indicating lower profitability
…presenting an opportunity to lower benefits and claims paid…
…Digital Claims Management provides an opportunity for insurers to lower claims (preventive), and accompanying costs, and to serve customers more efficiently and satisfactorily…
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Claims Management in the ‘Digital Age’
…but current online experience and satisfaction are relatively low…
• Legacy IT Systems Limit Agility
• Bias Toward Intermediated DistributionCha
lleng
es • Limited Innovation Focus
• Pressure on Investment Capacity
Insurance Lags Significantly in Customer Satisfaction With Online Experience Compared to Other Industries…
…With Satisfaction of Online Offering of Insurers Decreasing Past the Acquisition Stage
Average: ~7.3
4 28-25 -48 -49
Source: BCG digital satisfaction survey (March 2013), Morgan Stanley / BCG Global Consumer Survey (2014), Morgan Stanley Research
Net Promoter Score
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Claims Management in the ‘Digital Age’
…whereby Millennials drive a change in customer preferences……Driving Changes in the Key Contributors to Customer Satisfaction with
Claims Experience in the Insurance IndustryThe Average Adult Population will
Comprise of >40% of Millennials(1) in 2020…
(1) Born between 1980 and 2000 (Source: US Census Bureau , Accenture, EY)
…Millennials’ expectations have been set by companies outside the insurance industry (e.g. Netflix, Uber) and thus they expect personalized, convenient, transparent and rapid service…
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Claims Management in the ‘Digital Age’
…but the industry is at the brink of a technology-driven change…
• ‘Internet of Things’
• Telematics
• Disruptive threads
• Risk Selection
• Ecosystems
• Insurable risk pools
Connected Devices Available Prevention PotentialCause of Claims
Risk Reduction Through Adoption of Smart Devices
Home: Connected meters ~20 – 30%
Water leakage Active leakage detection devices ~70%
Fire Smart smoke detector ~70%
Theft Advanced alarm systems ~10 – 80%
Motor:
Poor drivingSafer driving & fraud detection through Telematics
~5%
False Claims ~10 – 20%
Current Risk/Losses
Source: BCG digital satisfaction survey (March 2013), Morgan Stanley / BCG Global Consumer Survey (2014), Morgan Stanley Research
Future Potential Home Risks/Losses
40 – 60%Reduced Risk in Home
15 – 25%Reduced Risk in Motor
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Claims Management in the ‘Digital Age’
…impacting the entire insurance value chain…
Product and Underwriting
Sales and Distribution
Policy Administration and Servicing
Claims Management
Enhance sales through marketing and digital online
front-end processes
-7.1pp
Better price policies through Big Data
-6.7pp
Optimise products and underwriting
processes through automation
-0.1pp
Support online sales through
digitally enabled distribution team
+1.1pp
Optimise policy administration and
servicing processes through
automation
-1.1pp
Improve fraud through Big Data
-1.5pp
Optimise process through automation
-1.2pp
Reduce reserves needed to cover claims volatility
through Big Data-0.1pp
Run modern IT systems and infrastructure -0.7pp
Optimise support functions through right sizing and automation -1.2pp
Combined Ratio (%)
Non Claims Expenses
Claims Expenses
99%
78-82%
Source: BCG digital satisfaction survey (March 2013), Morgan Stanley / BCG Global Consumer Survey (2014), Morgan Stanley Research
…with an important role for claims management in achieving the potential cost savings by adopting technology…
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Claims Management in the ‘Digital Age’
… but Claims Administration is largely based on the old ‘paper’ world
Claim Notification Damage Evaluation Settlement Closing & Recourse
Notification1
Estimation3
Settlement of Claim5 Billing & Payment6
Claim Opening2
Authorisation4
Recourse7
…The current claims process is not ‘lean’ and does not appeal to the ‘digital customer…
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Claims Management in the ‘Digital Age’
…while technically digital solutions are already available….
Veris
k A
naly
tics
Fixi
co
…The claims industry lacks a platform that connects the different innovations already available…
…and many more smartphone and e-solutions for insurance products are being launched
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Take picture & Upload request
Receive quotes (within 24h)
Compare & Choose repair shop
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Policy holder reports FNOL
Adjuster triages the claim with an appropriate response
Desk adjuster collaborates with policyholder using ClaimXperience
General Collaboration
Video Collaboration
Policyholder Self-Serve
Contents CollaborationContractor Collaboration
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Claims Management in the ‘Digital Age’
…CCN provides overall solution for claims administration ….
… A transparent and efficient platform to manage your claims administration …
Claims Force One (NTT DATA)Claims Management System
Insurance Companies Agents Loss
AdjustersInvestigators
/ Stakeholders
Contractors / Repair
Professionals
Fast
, Eas
y &
Sim
ple
…Digitalisation of entire process + real-time access for all parties involved in the process
Insurance Customers
ClaimsSupport
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Claims management in the Digital Age
…. A platform that connects strong International Partners ….
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Claims Management in the ‘Digital Age’
… more Innovative Digital InsurTech solutions on the horizon …. Road Mobility Service
• Usage Based Insurance solutions to support Driver Behaviour
• Policyholder will be supported locally
• Repair process through partnership program
Smart Home Service
• Policyholder choose partnership program over cash settlement
• Supplier receives list of required supplies
• Supplier outsource repairs to trusted contractors
Natural Catastrophe
• Use of drones in case of Earthquakes, floods & landslides
• Fast, Accurate, Save
• Ambulance drones to safe lives
• Inspection, survey, monitoring
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Claims Management in the ‘Digital Age’
…and IoT developments will impact insurance spheres significantly…
Source: Publicly available information
• Cloud-based thermal imaging camera• Provides early fire detection by monitoring indoor
temperature• Its night vision recording feature also helps in
adding to home security
• Internet security solution• Protects customers’ home network and
connected devices (incl. e.g. thermostat and baby monitor) from cyberattacks by scanning for malicious activity
• Solar powered, autonomous robotic shade that tracks sunlight while acting as a speaker system
• Includes integrated camera for security• Also tied to other smart devices
• Detects levels of radon via temperature and humidity sensors
• Intelligent Personal Assistant• Able to provide people with more than 300
insurance terms and their definitions
• Intelligent Personal Assistant• Can potentially gather data
Fotric 123 Bitdefender BOX Shadecraft Sunflower
Airthings Wave Amazon Echo Google Home
…IoT devices provide better measurement and insights allowing better risk assessment and tailored product offering as well as ‘digital age’ service experience…
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Claims Management in the ‘Digital Age’
…and provides the opportunity for you to join the digital revolution…
…Digital innovation happens fast, make sure you are not too late!
The ‘Facts’ CCN Contact Details
2 billion people are using a smartphone with internet connection. By the end of this decade, this will be 4 billion
Between ‘09 and ‘13 the mobile industry invested $ 1,800 billion in improving global telecom infrastructure
The download speed has increased 12,000x, while sending data still costs a few cents per megabyte
An average citizen uses his/her smartphone for two to four hours during each day. Teenager even substantially higher
Apple App Store and Google Play Store (OS on 82% of all smartphones) offer > 3 million apps
CEES WERFF
C.WERFF@CLAIMSCORPNETWORK.COM+31 (0)6 1030 4927
NACHTWACHTLAAN 201058 EA AMSTERDAMWWW.CLAIMSCORPNETWORK.COM
CLAIMS CORPORATION NETWORK
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Road assist technology
• Continuous car condition and safety status monitoring
• Immediate post-crash reporting to centralised road assist centre
• Integration of this technology requires full service centres to assist drivers
Claims Management in the ‘Digital Age’
…Volvo integrates safety features that affect the insurance market…Liability in autonomous mode
• Car manufacturers will force a change in the automotive value chain due to increasing high levels of integrated services
• Car manufacturers will accept liabilities and will enter insurance market (‘Trojan Horse’)
“Volvo will accept full liability whenever our cars are operating in autonomous mode”
Håkan SamuelssonCEO Volvo Cars
Safety assistance technology
• Fully operational technology decreases chances of impact and impact severity
• Will decrease the number of road-side accidents significantly
• Will improve road safety
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‘Future of Claims Management’
... TRANSFORM OPERATIONS TO MEET FUTURE NEEDS …
WELCOME IN THE 4TH. INDUSTRIAL REVOLUTION!
www.cla imscorpnetwork.com
info@cla imscorp.net
1058 EA, Amsterdam
Nachtwachtlaan 20 (Ringpark)
Claims Corporation Network