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Why You Urgently Need a Comprehensive Digital FNOL

Written by
Amrish Singh
Why You Urgently Need a Comprehensive Digital FNOL

Insurers are facing a customer experience crisis. Consumer expectations are evolving rapidly – if insurers can’t keep up, they stand to lose billions in premiums in the coming years. To come out ahead in the digital transformation race, insurers need a digital FNOL process that leverages reflexive forms to streamline the customer experience. 

Insurers Must Invest in the Customer Experience 

Digital transformation and economic uncertainties are squeezing the insurance industry. Insurance companies need to protect their combined ratios while also appealing to consumers who expect modern experiences in exchange for their hard-earned dollars. 

These realities are impacting insurance investment strategies. The Gartner CIO and Technology Executive Survey found that insurers plan to focus more on improving the customer experience and operational efficiencies and less on growing revenue in 2023. In the survey, 68% of respondents said they plan to increase investment in application modernization, making this the most popular tactic of all those named in the survey. Additionally, 41% plan to increase investments in total experience solutions. 

Billions of Dollars Are on the Line 

Investments in customer experience are absolutely necessary.

Policyholder satisfaction has been falling. In the J.D. Power 2022 U.S. Auto Claims Satisfaction Study, auto insurance claimant satisfaction dropped by 7 points compared to 2021. Many claimants complained they had to repeatedly provide the same information to different people at various points in the claims process. Satisfaction scores were especially low when policyholders had to interact with three or more representatives. Satisfaction rates were higher when straight-through processing technology automatically approved and routed the claim. 

When policyholders aren’t satisfied with the claims experience, they have little incentive to stay with the insurance company. Accenture says insurance companies could lose up to $170 billion in premiums over the next five years due to poor claims experiences that cause policyholders to leave. 

Policyholders pay for insurance and they expect good treatment if they have a claim. Insurance companies are clearly not meeting these expectations. Instead of navigating a simple process, claimants often have to jump through hoops to report their claims and receive payment. From the point of view of the insurer, the process may seem reasonable. From the point of view of the claimant, however, the process is tedious, repetitive and time consuming.

It's time for a new, digital FNOL process.

Your FNOL Process Sets the Stage

The FNOL process is a key step in the customer journey: it’s the point when customers go from policyholders to claimants. Previously, customers have been paying premiums but haven’t required much from their insurance company in return. When they have a claim, they expect to receive their money’s worth in the form of a fast, headache-free claims experience. 

With a digital FNOL experience that leverages reflexive forms, this is possible. When you ask the right questions and collect the right data up front, you can reduce friction for the claimant while also eliminating a lot of the backend work for your team. 

Reflexive forms are smart, adaptive and hyper-personalized. 

  • Smart: Because your digital FNOL is integrated with many other systems and data sources, forms can automatically prefill with known policyholder data and information. For auto insurance, this may include vehicle details, location information, DMV data and policy data. Smart forms save claimants time and reduce the friction and frustration of form completion.
  • Adaptive: The claimant’s response to each question determines the course of subsequent questions. This means that claimants are only asked questions that are relevant for their type of claim and their claim’s unique circumstances. The form fields that Claimant A sees might be much different than the form fields that claimant B sees. When appropriate information is captured by an adaptive form, adjusters have the right information from the start. They can proceed without having to ask claimants to re-explain everything. For simpler claim scenarios, automation can be built in so that claims can be instantly settled, without even having to get an adjuster involved. 
  • Hyper-personalized: It feels good to be known by your insurer and to have your time respected, and that’s exactly how claimants feel when they experience a convenient process that is designed to take as little time as possible. 

A truly digital FNOL process enables the automation of key processes, which results in massive improvements for both the claims professionals and the claimants.

  • Claims professionals save time. This reduces workloads and results in cost savings – not just in the FNOL, but also in subsequent stages of the claim.
  • Claimants enjoy a streamlined process. They are spared the time-consuming redundancies that exist in traditional claims processes, which results in superior experiences. 
  • Customer churn and claim litigation can be reduced. Claimants have less reason to shop for other coverage following a claim. If their needs are promptly met and they feel like they’ve been treated fairly, they will also have less reason to get an attorney involved.
  • Claims professionals are free to focus on more complex challenges. When claims adjusters are freed from the mundane, they have more time for complex tasks that require human expertise and decision making.

Solving Multiple Pain Points at Once

Insurers face multiple challenges. 

  • Customers expect digital experiences now. Digital transformation is a race – and the prize is customer loyalty.
  • Skilled claims adjusters are few and far between. Hiring challenges are widespread in the insurance industry as experienced workers retire. To manage staffing shortages, insurers must maximize operational efficiency. Digital processes also improve employee experience and are more likely to attract new talent into the industry. 
  • Profitability is falling. Many insurers posted underwriting losses for 2022. With increased risks and surging inflation, insurers need new ways to control costs.

A digital FNOL process can address all these pain points at once. With Liberate’s SaaS platform, P&C insurers can build fully automated claims processes that deliver superior customer experiences and improve operational efficiency. 

Find out how Liberate can help you quickly implement a digital FNOL process at the lowest cost available in the industry. Learn more.