Reduced to Numbers – Have We Lost the Art in Claims Management

Scoring is insurance tech “du jour.” An array of scoring companies appeared at InsureTech this year in Las Vegas, promising to score all human interactions with a number to indicate next steps. So of course, with an eye toward quantifying everything (which is a programmer’s dream) we took a closer look.

While scoring has alleviated a great deal of reading and interpretation from Insurance assessment tasks such as underwriting, a red flag appears when scoring enters claims management.

First a little background: Our company uses technology to harvest social media content related to claimants. After researching several thousand social media profiles and reading them in detail, we see only inconsistencies. This leads us to argue that there is an art to interpreting the information received by an adjuster, requiring skills above and beyond speech recognition and scoring.

For instance, the claims referred for social media investigation often return results riddled with issues related to language. Many claimants are not native English speakers, while others from lower socioeconomic status use a lot of slang or alternative spellings for common words. It would be easy to marginalize these populations using a linguistics score, thereby denying these populations the benefits to which they are entitled.

Second, scoring systems are just that – systems. They are 100% dependent on the quality of information they receive in order to produce a quality output. Or, as programmers like to say, “Garbage in, garbage out.” If the information used to produce the score is inconsistent or biased, the resulting score will also reflect that bias.

Third, claims adjusting (to some extent) is an art. The adjusters’ ability to interpret the information received from a claimant lends a level of intelligence to the final claim result that is greater than a score. And, when an adjuster receives a score as a starting place for their work, it creates an immediate bias prior to ever communicating with a claimant. In researching this article, one former claim adjuster commented, “Claim handling is an art form. These scores take away our paints and brushes, effectively turning us into robots, speeding the eventual automation of adjusting.”

Insurance is primarily a financial institution; however it is also supposed to be in the business of caring for people in their most vulnerable moments. In our rush to automate the industry, it is critical to remember that the end of the transaction is a very human interaction. While scoring can save thousands of hours, what additional consequences will it trigger?