The future of insurance claims handling requires a “touchless” approach, one where neither an adjuster or carrier employee is needed, according to a new report by LexisNexis Risk Solutions.

The researcher surveyed 24 auto insurance executives on industry approaches to claims processing for the “2017 Future of Claims Study.” It separates carriers’ claims practices into three categories: traditional, semi-forward, and forward-leaning methods.

LexisNexis concludes insurers are determined to move to the virtual handling of claims — a forward-leaning approach involving automated claims processing using photos, video, and additional data submitted by policyholders.

The transition to virtual, however, is gradual at best. All 24 insurance pros surveyed confessed their companies still use traditional claims processing techniques, typically involving on-site visits by claims adjusters. Only 38% of insurance companies use a virtual approach and are on path to touchless claims, according to the study.

“While there hasn’t yet been a complete shift to virtual claims handling, carriers who want to remain competitive will need to make the move to virtual and consider touchless processing if customer preferences are any indication,” the study says.

The saving grace for carriers that most — 83%, — also use "Fast Track" claims options along with more traditional workflows. FastTrack, considered a “semi-forward” approach by LexisNexis, involves tapping third parties to assess and fix car damage with minimal involvement from an insurer, according to the report.

Road to the ‘touchless’ claim

Insurance execs believe customer expectations will be the driving force behind the expansion of mobile, telematics, and analytics capabilities to improve claims. LexisNexis predicts self-service claims and the development of usage-based insurance to include claims investigations will occur in the next five years, as a result.

These advances, coupled with the introduction of autonomous cars and a growing demand for ridesharing coverage options, make touchless claims imminent, according to the study. Touchless claims would rely solely on technology to report claims, capture damage or invoices, run system audits, and pay customers directly.

“Regardless of where carriers are positioned on the continuum of the evolution of automated claims processing, the trend towards virtual — and eventually touchless — claims is inevitable,” the study says. “Clearly, the industry is moving toward increasing automated claims handling processes driven by technology-enabled solutions that yield benefits for both carriers and customers.”

Bill Brower, VP of product management claims for LexisNexis, and Todd Fannin, LexisNexis’ senior director of auto claims, co-authored the report.

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