JERSEY CITY, N.J., Jan. 18 � With extensive input from insurer customers, a leading provider of antifraud and personal injury claims solutions has identified 10 key factors to help insurers reduce the rising costs of handling personal injury claims. The checklist was developed by ISO from the feedback of insurer customers involved in improving their claims management practices.
“Choosing a new personal injury claims system to help reduce claims-handling costs can be a minefield unless a number of critical factors are considered carefully,” said Lee Fogle, vice president of ISO Claims Services. “ISO’s checklist identifies critical factors that allow insurers to improve consistency and accuracy in claims handling and reduce their costs.”
Here are the factors:
Early assessment means lower legal costs and better reserving
An early assessment of damages allows claims to be settled quickly and reduces administrative and legal costs that commonly account for 40 percent of claims costs. It is best to have a system that provides the claims handler with enough information to manage personal injury claims proactively from day one and make accurate offers as early as possible in the claims life cycle. Proactive management also helps insurers reserve more precisely.
Installing software can be a lengthy process fraught with implementation problems. However, systems are available on the market that can be installed easily and quickly. Says Max Carruthers, joint CEO, Rubicon: “In addition to providing our claims handlers with a desktop solution that is intuitive and rich in functionality, the hosted software approach means a quick implementation and is easy to integrate into our existing IT strategy.”
Need to cover other Heads of Damage, as well as General Damages
To manage claims more cost-effectively, managers need tools to consider other Heads of Damage, not just General Damages. To do this, insurers need a system that records and allows claims handlers to consider other relevant factors, such as legal costs and loss of wages � including future wage losses.
Ability to estimate rehabilitation costs and return-to-work potential
Getting people back to work after a serious injury reduces costs and provides victims with opportunities for physiotherapy, occupational therapy, counseling and other treatments. Effective claims management relies on an in-depth understanding of the injury and occupational details to generate an expected recovery profile of the claimant and rehabilitation programs that allow the claimant to return to work as early as possible.
Rich reporting and audit trails provide critical management information
Among claims-handling solutions on the market, only modern, object-based technology provides a true relational database that correlates data and comparative information to generate critical management information. Rubicon, for example, found that analytical tools, integrated in an object-based solution, helped them to demonstrate best practices to their clients.
By adopting the International Classification of Diseases (ICD) injury classification standards, insurers can “talk the same language” as the medical industry. This helps to standardize settlements and improve consistency in claims management. Not only are ICD standards used by the National Health Service (NHS) in the U.K., but also are widely used by healthcare insurers in the U.S. and healthcare providers around the world. It is best to have an XML-based system to input the medical data easily � and in the same industry-standard format � into the claims solution.
Claims handlers aren’t doctors. Providing claims handlers with both an encyclopedia of body parts and an understanding of different types of injuries and explanations regarding the severity of specific injuries with graphical illustrations and animations alerts them to possible complications and costs. Chaucer, for example, implemented a comprehensive database and medical encyclopedia of over 20,000 medical conditions and 14,000 occupations that allowed their claims handlers to get the same level of information and detail as medical reports. The results were more accurate first-time offers, better identification of cases that would benefit most from rehabilitation, and more informed negotiations with lawyers.
Auto liability, employers liability and general liability
A broad-based, robust system should be designed to handle a wide range of conditions � not only soft-tissue injuries, but also those more likely to occur at the workplace or in public places.
Controlling spiraling auto insurance claims costs
The ability to control rising personal injury protection (PIP) costs and determining thresholds to control payments are key to reducing auto insurance costs. Systems that integrate a medical encyclopedia of injuries and their severity are better able to provide claims adjusters with an in-depth understanding of injuries, as well as benchmarks to assess appropriate medical treatments and costs. None of the current software solutions allows insurers to compare their claims automatically with a given state’s defined threshold � except ISO Claims Outcome AdvisorTM, which incorporates this type of built-in intelligence.
Web services integration: .NET-ready
Web services integration enables insurance companies to deploy their personal injury claims solution rapidly with a low initial investment and integrate with other .NET systems across different platforms, applications and programming languages throughout their IT infrastructure.
About ISO Claims Outcome AdvisorTM (COATM)
ISO Claims Outcome AdvisorTM (COATM) is the industry’s first personal injury claims management database that manages the multiple dimensions of organizations’ personal injury claims portfolios. COA understands the severity and recovery implications of over 18,000 injuries, treatments, complications and preexisting conditions and 14,000 occupations and creates for an insurer a historic database of all of its injury claims. COA helps claims handlers, managers and actuaries manage the unique and complex medical, legal and occupational issues presented by personal injury claims and helps ensure appropriate financial arrangements are agreed to and implemented. Claims handlers can manage all aspects of a case from first notice of loss to return-to-work plans, rehabilitation and damages.
ISO is a leading provider of products and services that help measure, manage and reduce risk. ISO provides data, analytics and decision-support solutions to professionals in many fields, including insurance, finance, real estate, health services, government and human resources. Professionals use ISO’s databases and services to classify and evaluate a variety of risks and detect potential fraud. In the U.S. and around the world, ISO’s services help customers protect people, property and financial assets.