a range of severity scores, for example,
it makes sense to assign the least severe
claims to newer adjusters, providing them
with low-risk claims so they can learn the
fundamentals of claims handling. As experience levels rise, so should the complexity of claims assigned. This allows
adjusters to deepen their experience level
while optimizing claim outcomes for
claimants, employers and insurers.
Beyond triaging claim assignments,
severity thresholds can be built into the
claims handling process. For example,
auto adjudication may be incorporated
for the lowest-severity claims, while actions such as mandating nurse case
management and increased managerial
oversight may be considered for the high-est-potential claims. This allows a claims
department to focus its time, energy and
expenses where they can have the greatest
impact on high-severity claims.
Why predictive analytics?
With the unprecedented availability of
data, it has never been easier to reap the
benefits of establishing a claims process
informed by predictive analytics. Incorporating a robust model can yield a
valid statistical basis for decision making,
which strongly augments the decision-making ability of claims staff. When deciding if this is the right time for employ-ing analytics, it is important to consider
not only potential return on investment,
but also the very real cost of inaction.
Claims severity continues to rise, driven by medical and indemnity costs, for
which the National Council on Compensation Insurance reports a cumulative increase of 226.7 percent and 135.2 percent
over the past 20 years, respectively.
Adjuster experience, while invaluable, is not infallible. A good predictive
model informs, but does not replace
claims experience in decision making. It
helps adjusters and management focus
attention where it is most needed, minimizing the risk of exploding claims and
reigning in unnecessary expenses with
potential for directly improving an insurer’s financial results.
The human element will continue to
impact the claims process — just as it
should, given the insurer’s goal of help-
ing claimants deal with unexpected losses
that may represent life-changing catas-
trophes. But the development of finely
tuned analytical models is yielding in-
sights into those claims to bring a sharper
understanding of their potential severity
and helping inform those involved in the
claims process from assignment to settle-
ment. Although not yet a crystal ball, bet-
ter analytics are opening new windows
and providing a clearer view into the
world of claims.
WHEN SOME THINGS CAN’T WAIT ...
When disaster hits home and families are displaced, basic needs become a
priority. That’s why we have developed the CRDN Immediate Needs Service.
CRDN provides up to two weeks of clothing and other textiles families need to
go to work, to school and continue their lives as normally as possible. We also
securely store these and other textiles until the family can have them delivered.
• Two weeks worth of clothing and comfort items are restored and returned
within 24 hours
• Secure, insured and climate controlled storage
• Local storage provides convenient homeowner access to their belongings
The power of an international Network.
The personalized attention of a local Partner.
One call brings immediate response.
800-963-CRDN (2736) 24-Hour Claim Assignment Line
or visit crdn.com