Maximizing Efficiency with Automated Claims Processing for Insurance Companies

Automated claims processing is the new way to process and settle claims for insurance companies. It not only helps you in maximizing efficiency but also helps you in saving a lot of money on expenses.

You will get many benefits throughout the process, including increased customer satisfaction and accurate results. This complete guide will cover everything you need about claim process automation.

Let’s start with the basic introduction, and we will then move forward.

Introduction

Claim processing is verifying the claim before the company pays, settles, or rejects the claim. Claim processing usually involves more than 20 checkpoints to ensure fraud detection and to maintain moral integrity.

An investigation is done before sending the remittance. Sometimes, an extra review is conducted if the claim doesn’t look valid.

• Claim processing and management are important parts of insurance companies.
• Claim processing is of utmost importance to give the right person the remittance.
• It prevents fraud activities.
• Verifying information and processing will save future litigation.
• Claim management allows companies to settle claims easily.

What is Automated Claim Processing

Automated claim processing is automating the whole claim process using RPA (Robot Process Automation) and Machine learning.

Usually, companies spend hours and days of valuable time processing the claim as the claim processing involves many stages. Communication In this, the customer needs to stay updated with the process.

Automated claim processing solves a lot of problems. It uses machine learning to detect fraud and automated customers. These two advantages are the biggest time saver for insurance companies.

With this, they can prevent fraud as well as give customer satisfaction. Let’s see all of them in depth. We have previously covered more benefits about using automation in insurance companies.

Benefits of Automated Claims Processing

As mentioned, there are a lot of benefits of automated claims processing. Here are a few of them.

Faster processing times

The automated process makes it super-easier to process the claim. It can verify the information and also fill out all the paperwork. The automated system notifies the team member when human intervention is needed. This way, the team member can confirm the selection and continue the process.

Increased accuracy and reduced errors

When a computer does the processing, the chances of errors reduce close to zero. So, you will get far better accuracy than humans doing the process. The system will analyze data from various sources to verify the information provided.

Improved customer satisfaction

Back-and-forth communication, along with faster processing speed, is what customers want. The automated system also sends a notification every time a stage is cleared.

Cost savings for insurance companies

You will require fewer human resources as the process is almost automated. You can save a lot of expenses in cost. The system will cost you a bit to start working. However, the development cost is only the biggest cost involved. It will save you a lot in recurring costs.

How Automated Claims Processing Works

In this section, we will see how the automated claim process works. Before we see the steps and a working example of the claim automation process, we will see the technologies used in the automated claim process.

Types of technology used in automated claims processing

As it involves technology, many secondary programming languages and technologies are used. These are the major ones.

Automated claims processing works with the help of the latest technologies.

• Big data: Big data is the process of viewing, filtering, and managing a large amount of data. It is used in claim processing to collect and view the data.
• Machine learning: Machine learning is the technology to teach machines to learn themselves. Over time, the system automatically learns new fraud detection techniques and gives accurate results.
• Artificial Intelligence: AI is the technology that functions just as a human being would.
• RPA: RPA stands for Robotic Process Automation. It’s used to automate and use the same repetitive tasks in an insurance company.
• Cloud computing: Cloud computing is the way of storing data in the cloud. Here, the entire process is also done in the cloud.

Steps in the automated claims process

The steps depend on the process and the insurance type. You will get the steps depending on how many systems are running and what modules you are running. To summarize, there are a few steps that are involved here. It includes the following steps. There are various modules executed in the given steps. So, these steps will take a longer time to execute.

1. Collecting the data: The first step is to collect the data from all the sources. It includes collecting the data from the policyholder and contacting the broker for additional information about the claim.
2. Assessing the policy: The policy details are verified, and the initial details are collected.
3. Verification: This is where the investigation begins for fraud and the other mandatory investigations.
4. Damage assessments: Once the part is completed, the estimated damage is calculated, and the assured sum is given.
5. Processing: This is usually the last step of automated claims. The payment is processed and transferred to the nominee or policyholder in this step.

Examples of automated claims processing in action

Let’s take a quick small example of how to claim processing works. At first, the user requests the claim, and the system asks for all the necessary information required for the claim. It also includes documents that are necessary for the claim and policy number.

After that, the system will automatically collect the policy information from the previous data provided by the customer. Once the data is collected, the policies go into further verification. In this phase, the policy is checked and tallied with the data. The medical records are collected from a trusted source to cross-verify if needed.

Once the policy is reviewed, the exact amount is calculated based on the details given. The amount is then processed and credited to the customer’s account.

In the entire process, there are various stages where a team member will require double verification. For instance, after the policy is reviewed for fraud, it’s checked by the team to ensure it. In the same way, there is various stag where extra verification is required.

Therefore, the system still involves the team. It’s good as the system is still new and requires monitoring.

Types of Solutions AlxTel Provides for Claim Processing Automation

Automated claim processing is a complete solution that includes many small solutions companies can utilize. Alxtel provides many such solutions for insurance companies.

Automated claim intake systems

The first step of the process is for the policyholders to submit their claims. The automated claim intake systems will allow the policyholders to submit their claims automatically. As soon as they enter their policy details, the system will fetch the details of their policy and autofill a few details.

In this way, the policyholders will have to enter a few details. The automated system also takes the files from the customers and verifies them. Alxtel focuses on creating the entire system for the intake of policy documents. If you already have a system that the customers use for buying the policies, Alxtel can integrate the system with it. Your customers can buy the policy and claim it from the same portal.

Claim triage systems

The claim triage system uses Artificial intelligence (AI) and Machine Learning (ML) to train and classify the claims based on the priority level. As an insurance company, there will be a lot of claim requests to address. Most traditional systems use the “first come, first serve” technique for priority. Instead, it would help if you were using a claim triage system.

The claim triage system uses various factors to calculate the priority of the claim. Depending on the claim’s value, it lists it in the priority queue.

It uses machine learning and AI to create the list. Here are a few factors that are considered.

• Are there any injuries or fatalities in the claim?
• Does it require any third-party verifier or further documentation?
• Are the involved assets usable or operable? A good example is whether the car is operable after an accident.

Depending on the data, these claim triage systems in automated claim processing have 4 stages. Here are 4 stages with an explanation or an example.

• Immediate: If the policyholder requires immediate life-saving treatment.
• Urgent: The claim needs to be settled urgently. It could be a small surgery or a car accident for vehicle insurance. Usually, it requires an intervention that needs to be done urgently.
• Delayed: This category arises when the claim needs to be settled and is not urgent. The stage might involve extra verification.
• Non-urgent: The claim can be made promptly.

Some claim triage system follows 5 stage processes

• Immediate
• Emergency
• Urgent
• Semi-urgent
• Non-urgent

Alxtel can create different stages for your system if needed. Depending on your custom requirements, we can create your desired system.

Automated claim assessment systems

Verification is required before the claim process starts. The software does the work for you. The automated claim assessment systems will first verify the details of the policy. For instance, it will see the reason for death if it’s a life insurance claim. Further, it checks if any of the insurance add-ons apply to it. Based on this, it calculates the total sum assured.

After that, the decision-making algorithm kicks in. It further evaluates the claim to determine its validity and accuracy. The whole process is done in a few minutes or seconds. It saves a lot of time.

Alxtel Solutions integrate with the current system. If you want a separate system for the intake and one for the claim processing, the automated claim assessment system can fetch the data from the other systems. We work with APIs to provide solutions for this.

Document management systems

It becomes difficult to manage all the documents and pin them correctly to process the claim. The automated system for document management will automatically classify the documents and create a complete PDF file for you and the customer.

With proper searching and filtering mechanism, it will take you a few seconds to find the document you need. It makes it easier to merge and create a complete document for the entire policy after the claim. It allows you to request documents from customers. It automatically renames the document to the preferred title.

For instance, if there is a medical record that needs to be submitted by the customer. It will automatically rename the record to the preferred title, such as medical_record_customername. Of course, the title can be arranged as needed.

It also fetches the document submitted by the policyholder during the purchase. Further, if required, you can add a feature to collect the data from a preferred trusted source, such as public medical records. It brings us to the next feature.

Another technology, Intelligent Document Processing (IDP), is used here to detect and process documents. It’s a modern alternative to OCR. It uses AI to detect and read documents. The main aim of the processing is to convert unstructured data into useful data. One can use it to fill up the information in the form.

It includes not only documents but also images. So, if there are images involved, the system compresses them without losing the quality of the image and adds the image in the appropriate section.

With Alxtel cloud management, you can store all the documents in the cloud. Our cloud services are most useful here. In this way, you can use all the services accordingly.

Fraud detection systems

Insurance frauds are no new. They have been in the industry for a long time. However, the only difference is that the claim processing automation is now smart enough to detect fraud. The machine learning algorithm is very much help here. With this, the system keeps learning itself to improve.

Along with AI and ML, the system detects fraud and potential fraud claims. It flags them as fraud or possibly fraud. Technologies like behavior-pattern algorithms, data mining, analytics, etc., are used to prevent fraud. It requires less human intervention.

You can save a lot of expenses in terms of salaries as well as by preventing fraud. Many frauds are happening in the insurance industry. The system can detect all types of fraud.

With our fraud detection system, you can also use other sources to fetch the data.

Payment automation systems

It’s quite common to have a payment gateway in the entire system. Here, you will get the same. The automation system automatically calculates the required payment and does the after-math of payment. So, the customers can directly pay using multiple payment methods online. There is no need for manual process processing.

The system reminds the customer several days before the payment is due. In this way, they can pay the premium easily. You can also set automated calls for payment notifications.

Depending on your requirements and company size, Alxtel provides payment solutions. You can integrate the payment methods. With custom payment solutions with instant or very less clearance time, everything will be fine in the cash flow management of your system.

Challenges and Limitations of Automated Claims Processing (and how to solve most of them)

Like every system has a few challenges, claims process automation also has limitations. We will also cover a few possible solutions.

Concern for job loss

Recently, there has been a lot of debate about the concern for job loss as AI takes over. In the case of claim process automation, this won’t be the case. The claim process is surely automated. However, human intervention is needed. The post usually falls under customer care executive categories. Further, the automated claim processing system automates most work. A final confirmation is still needed from the staff team of the insurance company.

Need for careful implementation and oversight

The system is quite new. Therefore, it required careful implementation and oversight. So, the claim process automation is not 100% automated. You will still need to confirm and verify the information once it’s done.

For instance, if a claim fraud is detected, you will need to recheck it before rejecting it. Now, the system will require human input.

Limitations of current technology

As mentioned above, the system has a few limitations. However, it can be solved if you upgrade to a better system.

It also depends on the system you are using. Alxtel has been providing insurance automation services for a long time. We got some of the top insurance companies as our clients. Our technology meets your requirements.

One can use other technologies on top of automated systems to get the best out of the current technology. Alxtel’s solutions are perfect for the same, as we provide 360-degree solutions for IT needs.

Conclusion

To summarize, claim automation automates the entire claim management and processing system with the help of technologies. The technology ensures less number of frauds and speeds up the process.

Now that you know most of the automated claim processing, we will see how you can get the entire system. The top modules include an intake system, triage system, document management, fraud detection, and payment automation. With these, you can get the best system for your insurance company.

The process of getting the entire system is quite easy. Alxtel provides the services to develop and implement the system in your current infrastructure. If you already have a system for policy intake, we can integrate the claim automation system with your current system.

Alxtel provides a complete solution for migration and development. Contact us today, and let’s schedule a meeting for further discussion. One of our team members will guide you through the entire process. You can share your company work and further details about your desired automation system in the meeting.

Schedule a meeting today, and let’s get started with your project.