The Insurance Balancing Act:
Customer Satisfaction vs. Payments Risk
Real-Time Visibility into Claims Payments Ensures
Call Center Efficiency and Reduces Fraud
In recent years, insurance carriers have made significant investments in claims management systems to reduce costs and improve internal process efficiencies. Yet when it comes to issuing and tracking the payments resulting from those settled claims, a large number of insurance firms have yet to take advantage of the financial technology tools available to them.
Settled claims represent the most significant cash outflow for an insurance organization, consuming approximately 80 percent of an insurer's annual revenues. Even a one point improvement in efficiency can contribute significantly to the bottom line of an organization.
In the past few months alone, a number of factors have brought the need for improved payment processes to a head, including flood insurance claims for areas hard hit by Hurricanes Katrina and Rita, estimated to exceed $22 billion by the Federal Emergency Management Agency. As the volume of client inquiries rises due to missing or delayed payments, call center processes are strained and client service will ultimately suffer.
For insurance companies, the stakes are high for managing client satisfaction. A survey in October 2005 by Ipsos-ASI revealed that only 18 percent of respondents approve of the job being done by insurance companies in response to the hurricanes; results lower than all levels of government and non-profit organizations. With this sort of attention, remaining agile amidst intense competition is critical to long-term success.
Defining the Problem and its Effects
Recently, Bottomline Technologies worked with a number of medium- and large-
sized insurance carriers to better understand this problem, its effects and the
results achieved by addressing it. The issues for these firms included a number
of commonalities:
- Timely payment status information was not available at the point of need;
- Dependence on manual processes for inquiry, stop and reissue requests;
- Improper payment volume was high;
- No capability existed to provide centralized audit and compliance reporting across multiple claims and back-end systems;
- Legacy systems were inflexible and expensive to maintain.
Given current market conditions, the effects of these problems have forced carriers to act. Three primary effects were perceived as most significant. First, carriers were forced to balance the risk of poor customer service brought about by delays in research and fulfillment against the risk of improper payments. Secondly, strained manual processes encouraged inadequate adherence to company policies resulting in greater losses, poor client service and negative performance against expense budgets. Finally, multiple systems and existing solutions did not ensure both regulatory compliance and reliable reporting for compliance purposes, increasing the risk of substantial fines, bad publicity, and in a few instances, jail time for executives.
Claims Payment Lifecycle Management
Fortunately for insurance companies there are solutions available. Based on
WebSeries®, Bottomline's
insurance solutions automate and extend the entire claims payment
lifecycle process from distributed check issuance to risk management, bank
reconciliation and compliance reporting.
Bottomline's WebSeries Claims Payment Management solution assists clients in addressing customer and agent satisfaction, proper financial controls and regulatory compliance by:
- Increasing the visibility of claims payment status across the enterprise with real-time data for treasury, claims and call center agents to deliver improved service;
- Consolidating and managing payment data across multiple legacy systems and banking relationships;
- Managing and controlling the workflow of payment voids, stops and reissues to reduce costs, duplicate payments and fraud while increasing customer satisfaction;
- Improving compliance and reporting for regulations such as OFAC, Sarbanes Oxley and FinCEN, as well as unclaimed property and escheatment laws;
- Reducing costly system customization by extending, not replacing, legacy systems.
For more information on WebSeries Claims Payment Management, including the critical questions to ask when evaluating a solution, contact a Bottomline Technologies representative at 1-800-472-1321.