The Effects of Technology on the Insurance Field

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Technology allows insurers to respond to claims more quickly.
Technology allows insurers to respond to claims more quickly. (Image: car crash image by dawn from Fotolia.com)

Over the past decade, technology has changed the face of most businesses, improving communications, managing data more efficiently and changing expectations of customer service. The insurance industry is no exception. Insurance companies, brokers and agents use technology to better manage their portfolio of accounts, analyze the price of their policies and settle claims faster and more efficiently.

Rate Analysis

Insurance rates have always been based on an analysis of the factors that cause an insurance claim. Using information about the insured, or the characteristics of a risk location, actuaries model that information against their loss experience to identify trends. These trends are used to set insurance rates based on the likelihood of a certain policyholder experiencing a claim. Technology allows insurance actuaries to model possibilities at a much more granular level, using an unlimited number of variables.

Insurance to Value

One of the most common mistakes made by both insureds and insurance companies is under-insuring a risk. Too often, awareness of this problem occurs only after a claim if filed. New valuation tools tap into information gathered from contractors, retailers and trades to set benchmark replacement costs for building supplies and personal property based on the address of the risk. This information is combined with factors such as the square footage of the property to better estimate the cost to repair or replace the location should a loss occur.

Remote Claims Adjusting

When someone files an insurance claim, a claims adjuster must view and assess the damage to estimate the repair or replacement costs. Historically, this process took days as the insurance company retrieved a copy of the policy, assigned an adjuster and scheduled the meeting. Many companies now use a mobile adjusting system that allows the adjuster to visit the scene armed with all the information required to confirm coverage and proceed with settlement. Some insurers can now settle auto insurance claims in certain cities while the vehicle is still on the side of the road. Clients benefit from a much faster response time and the insurer benefits from reduced expenses and improved productivity.

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