Do insurance claim managers have a future? The challenge from AI

In recent years, we have seen significant strides in digital technologies such as Artificial Intelligence or AI as well as the spread of social machine technologies, and this has been a driving force behind the rise of the digital economy.

Many firms and businesses have looked to implement these new technologies to take advantage of their capabilities and further their competitive advantage over their peers.

Insurance organisations are continually under pressure to improve their services and customer experience at a reduced cost.  Neal Baumann of Deloitte has noted that many firms have looked to implement new technologies such as AI to simplify the processes for customers and also reduce costs in their businesses (Deloitte).

One part of the insurance industry where these technologies have been instrumental in altering employment roles is the Auto Repair industry, in which firms like AutoGlass operate. Insurance claim managers working in this industry have always played a key part in the distribution of repair jobs as well as the assessment of claims to determine which course of repair or replacement is required.

Historically, when a customer sought to make a claim, they had first to take their vehicle to a service centre where the damage would be assessed (R. Singh et. al. 2019). Now, as I saw first-hand when I interned at AutoGlass, customers simply send in images of their damage where they could be assessed by an insurance claims manager in an office.  Furthermore, with insurance companies such as Aviva partnering with AutoGlass as their delegated care repair provider, insurance claims managers no longer needed to contact an insurer but just book an appointment online while the paperwork is taken care of by Aviva (AutoGlass website).  The days of substantial numbers of staff working in large offices taking calls from customers and quoting them prices for services had gone.

Effectively, digital technologies have significantly changed the skills required for the job of an insurance claims manager. No longer would an insurance claims manager need to have strong interpersonal skills and possess the ability to empathise with a customer; instead, they needed to be able to understand how to interpret orders that came through online and then turn those bookings into orders and send them out to the closest repair shop.

However, with technological developments continuing, the question now for people like insurance claims managers is what their job may entail in the future. One such key development for insurance claims managers lies in the increasing use of AI and apps. Nick Cleary, the Customer and Digital Director at AutoGlass, was quoted as suggesting that “AI is a fascinating area which I have watched closely over the last few years, and there is no doubt it has the potential to dramatically change many aspects of our society, whether that is in our homes or how we interact with businesses” (glassBYTES.com 2018).

AutoGlass, in partnership with Service Certainty imageproof, revealed details in an article in RDN Repairer Driver News (2018), of an app that they had created and trialled which allowed customers to take a picture of their damaged windscreen and then upload it onto this app. From there, an AI system would analyse the picture and determine whether the damage was repairable or would need to be replaced.  Since the testing period, the current AI system is scanning around 2,500 photos each week and, according to AutoGlass, is achieving an 80% accuracy rate (Fleetworld 2018). The company also noted that this will only “grow as the AI processes more data” (Fleetworld 2018).  For insurance claims managers, this development would clearly represent another reduction in their work requirements. For AutoGlass, the use of AI could be expanded into other aspects of repair service – and this potential new area has been termed by market operators and by Fleetworld (2018) as Advanced Driver Assistance Systems, or ADAS for short.

Although the use of AI processes will result in a significant reduction in the need for insurance claim managers, it does not necessarily mean the end of any human assessment in the insurance claim management function. AutoGlass have maintained that there will still be a need for human involvement in cases where the assessment done by the AI and the app process were inconclusive (Repairer Driver News 2018).  In addition, insurance claims managers will have to develop new and different skills.  They may well need to be able to contribute to the firm’s success in terms of product development, sales and marketing or customer complaints.  They will need to be able to undertake other functions within a business and certainly need to understand the technology that underpins the use of the app.  The digital economy therefore offers many attractions for customers and company shareholders, but represents a need in workers, particularly in the case of insurance claims managers, to have the skills of adaption in a rapidly changing business environment.

• Retrieved from:
https://www.autoglass.co.uk/insurers/aviva/
• Retrieved from:
https://www.autoglass.co.uk/?ins=wt28&gclid=CjwKCAiAhJTyBRAvEiwAln2qBxKCMDfA6Wi1ebyoFWd9oohfCbtUosbjonuOuKDenL6aiIx5DEI2GBoConUQAvD_BwE&gclsrc=aw.ds
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https://webcache.googleusercontent.com/search?q=cache:_W64KQG0lNgJ:https://www2.deloitte.com/global/en/pages/financial-services/articles/insurer-of-future-claims.html+&cd=1&hl=en&ct=clnk&gl=uk
• Retrieved from:
https://fleetworld.co.uk/new-ai-app-can-determine-windscreen-repair-or-replacement-choices/
• Retrieved from:
https://www.glassbytes.com/2018/02/autoglass-launches-artificial-intelligence-technology/
• Retrieved from:
https://www.repairerdrivennews.com/2018/02/16/safelite-u-k-sister-company-autoglass-using-ai-photo-estimating-to-decide-fate-of-windshields/

• Retrieved from:
https://roboticsandautomationnews.com/2017/07/01/adas-features-of-advanced-driver-assistance-systems/13194/
• R. Singh., M. Ayyar., T. Venkata., S. Pavan., S. Gosain., R. Shah., (2019). Automating Car Insurance Claims Using Deep Learning Techniques. 2019 IEEE Fifth International Conference on Multimedia Big Data.