Categoría: Insurance Industry

We all know the function of insurance companies is to protect and support us in an unfortunate event that may threaten our family and our most precious assets, but what are the internal and external actors involved in this process? Here we explain it to you:

Main internal stakeholders:

Within the insurance teams we have the following departments, which play a specific role:

1. The commercial department:
   • Customer prospecting.
   • Interaction with policyholders. 
   • Interaction with intermediaries: broker, insurance bank, etc.
2. The underwriting department: 
   • Elaborate the underwriting standards.
   • Monitors compliance with underwriting standards.
   • Drafts and interprets insurance policies.
3. The claims department: 
   • Manages the flow of claims.
   • Direct settlement or indirect settlement.

Main external stakeholders:

Outside the insurance company, we have three external stakeholders who occupy the following roles:

The insured: The person that subscribes to the policy with the insurance company, committing himself to pay the stipulated premiums and having the right to collect the indemnities arising from the loss.

Insurance broker: A natural or legal person who carries out the commercial activity of private insurance mediation without maintaining contractual ties that involve affection with insurance companies and offers independent, professional and impartial advice to policyholders.

The official adjuster: a person registered with the Commission for the Financial Market (Chile) who is engaged in settling insurance claims.

How does LISA Claims contribute to insurance companies?

• We reduce 80% in liquidation processes.
• We increased up to 20% of the company’s NPS.
• We reduced operational costs by 60%.

To learn more about LISA Claims, click here to contact us.

In the previous article, we left open an important topic regarding the most important trends that have emerged since the appearance of Covid-19. As a promise is a promise, here we will continue to tell you more about the topic and other relevant issues:

6. Direct interaction with insurers: the last few months have seen a noticeable shift, with many customers choosing to contact their insurance company, especially for small things. The shift to digital channels offers great opportunities for a seamless customer experience from start to finish.

7. Mimic other markets, but with a South African twist: Insurance is very similar around the world, but varied markets have different levels of digital maturity. South Africa is lagging behind in digital maturity, which means we can look at other markets to anticipate upcoming trends, this is supported by Insurtech Insights in its article Digital Trends in The Insurance Industry.

Los grandes cambios serán productos que se distribuirán digitalmente y el proceso de reclamaciones totalmente automatizado.

8. Product innovation: We are likely to see increased product innovation around telematics offerings for those who work more from home, which may include cyber insurance and the Internet of Things (IoT). Partnerships with insurtech, online platforms and mobile network operators will be key to meeting the growing demand for digital solutions.

9. Rise of affiliate distribution channels: by relying more on alternative distribution channels with digital partnerships we will be able to reach niche groups. We are likely to see the most innovation in lower-value items that are often sold through these channels.

10. Tracking: We’ve been tracking driver behavior for years, but why not track other assets? With telemetry, it’s easy to put a tracking device on an expensive bicycle, a TV, and other things. Given the rise of IoT, we will see an increase in tracking, which will inevitably influence underwriting, the premiums people pay and claims prevention.

As we have mentioned on more than one occasion, the Covid-19 landscape has pushed the insurance industry to a forced take-off away from its conventional and obsolete processes, and many players in the insurance sector have begun to digitize, step by step and at an acceptable speed.

Industries and businesses went from being complicated to complex, what does this mean? The former refers to patterns that repeat, problems that can be solved and where automation drives management thinking.

The complexity goes beyond that, there are patterns, but they are not repeated, problems are unpredictable and robustness is one of the most necessary factors.

Clearly, insurance cannot respond to the growing risks of a complex world by offering business as usual. A shift is needed toward loss prevention and loss management, toward value ecosystems and the generation of new revenue streams across the risk value chain.

01. The claims process: The biggest digital transaction in this space is for people to follow the progress of their claim, wherever and whenever they want, plus it can be managed as self-service, so we can see from the Insurtech insights article.

02. New business: Being able to quote online to attract new business has become indispensable. From this we can decide whether to keep pace with customer expectations or lose them.

03. No more legacy systems: Most service providers are beginning to migrate their historical backends to modern technology systems, which can expose the insurer to application programming interfaces and provide real-time data with 24/7 capabilities.

04. Robotic Process Automation (RPA): This is still in process, but many are trying to integrate AI software to collect and use the data they already have.

05. Chat vs. voice: we have seen the growth of chat capability, e.g. WhatsApp, especially in the direct space. However, there are still people who are drawn to calling the insurer, especially when they don’t get timely responses and there is a lot of silence on the other end.

There are still more trends! But in order not to make this article too long, we have decided to split it in half and it will soon be on our blog 🙂

Wait for it!

As we have mentioned on more than one occasion, the Covid-19 landscape has pushed the insurance industry to a forced take-off away from its conventional and obsolete processes, and many players in the insurance sector have begun to digitize, step by step and at an acceptable speed.

Industries and businesses went from being complicated to complex, what does this mean? The former refers to patterns that repeat, problems that can be solved and where automation drives management thinking.

The complexity goes beyond that, there are patterns, but they are not repeated, problems are unpredictable and robustness is one of the most necessary factors.

Clearly, insurance cannot respond to the growing risks of a complex world by offering business as usual. A shift is needed toward loss prevention and loss management, toward value ecosystems and the generation of new revenue streams across the risk value chain.

01. The claims process: The biggest digital transaction in this space is for people to follow the progress of their claim, wherever and whenever they want, plus it can be managed as self-service, so we can see from the Insurtech insights article.

02. New business: Being able to quote online to attract new business has become indispensable. From this we can decide whether to keep pace with customer expectations or lose them.

03. No more legacy systems: Most service providers are beginning to migrate their historical backends to modern technology systems, which can expose the insurer to application programming interfaces and provide real-time data with 24/7 capabilities.

04. Robotic Process Automation (RPA): This is still in process, but many are trying to integrate AI software to collect and use the data they already have.

05. Chat vs. voice: we have seen the growth of chat capability, e.g. WhatsApp, especially in the direct space. However, there are still people who are drawn to calling the insurer, especially when they don’t get timely responses and there is a lot of silence on the other end.

There are still more trends! But in order not to make this article too long, we have decided to split it in half and it will soon be on our blog 🙂

Wait for it!

In a world as changeable as ours, it is logical to think about the importance of having an insurance company to protect us and our assets in case of any event.

A car crash, a house fire and even an illness we are going to be treated for are some of the most common claims, all of which have basic requirements and a particular way of reporting them. But if I ask you, how can you claim from your insurer after a natural disaster, what would you tell me?

Your starting point begins when you should contact your insurer as soon as possible and find out the following:

• Are damages included in the terms of coverage of your policy?
• It is important that you know how much time you have to make a claim.
• Do the losses incurred exceed the amount of the deductible (this is the amount agreed with the insurer for the insured to pay before the insurance company takes care of the other expenses)?
• How long does the claim process take?
• Do you need to have estimated repair costs at the time of inspection?

1. Make any necessary temporary repairs and, to the extent possible, take precautions to protect your property from further damage.

Keep receipts for expenses incurred and submit them to your insurance company for reimbursement. Expenses for temporary repairs are part of the reimbursement agreement.

Avoid starting final repairs until the insurer’s expert has determined the damage.

1. Be prepared for the appraiser/inspector’s visit. Your insurer may send you a «statement of loss» form, which you will need to complete. The more information you collect and have on hand about the damage and loss (dates, defects, description of affected items, repair costs, etc.), the faster you will be able to file your claim and receive the appropriate compensation. Do not discard any damaged items for any reason until the appraiser has evaluated them.

• Photographic and video evidence will never be superfluous, so support your claim by capturing your belongings. However, depending on the magnitude of the natural disaster, your property may have been destroyed or you may lose backup documentation, in this case, use the data you remember.
• Identify the structural damage to your home and other surrounding structures such as the garage, swimming pool, among others. With this you will be able to put together a list of things that the inspector should check: cracks, broken roof tiles and even the electrical system of the house (many insurance companies recognize the cost of the electrical inspection).
• Obtain written estimates from licensed specialists: include itemized details of the materials to be used, prices, among others, which will make the evaluation of the claim easier and faster.
• Make copies of all the documentation the appraiser gives you and a list of what he sends to the insurance company. Have all the answers and documentation issued by the insurance company at hand, noting dates, numbers and other data that you consider important.

It should be noted that standard homeowners’ insurance does not include coverage for flood damage, so for this type of risk, you need an additional policy.

This whole process looks cumbersome, doesn’t it? That’s why it is so important that conventional insurance companies can develop with the help of technology in order to digitize and speed up all their processes. Learn more about our LISA Claims solution by clicking here.

Through studies conducted, we can see that there was an increase in fraud compared to 2020 when all the pandemic hype started.

These frauds were closely related to home insurance. The mandatory home confinement made people use more frequently the basic elements of the home such as: household appliances, glassware systems, common expenses of the condominium and from there the rise of frauds in the branch was born.

Claims usually arise from a real breakdown, which was not caused intentionally, but the costs are inflated in order to be able to charge a higher insurance premium. All the above are classic leakage breakdowns, burst pipes and other types of leaks, accounting for 44% of attempted fraud in the home insurance business.

Other problems induced were the simulation of electrical failures for the refrigerator, for example, reporting a power surge in the middle of a thunderstorm to claim a new computer, claiming a non-existent water leak in the floor to repair it, among others.

Miguel Ángel Álvarez, head of the fight against fraud at Unespa (Unión Española de Entidades Aseguradoras y Reaseguradoras), pointed out that having had to spend two months in our homes increases the likelihood of attempted home insurance fraud.

We can also highlight that fraud attempts for 2020 were for weather events, mainly in storm damage, which increased from 18% to 28% of false household claims.

On the other hand, despite the fact that the vehicle branch continues to be the one that registers the most frauds (as it is a service that every person who drives a car is obliged to have), it has experienced a notable decrease in Spain, going from 61% in 2013 to 41% in 2020.

Despite the confinement and mobility limitations that marked the past year, car-related claims continue to be the most frequent. The percentage of car-related insurance frauds last year stood at 47%.

It is known that 18% of claims contain an element of fraud.

Insurance has been close to us to be a complement and a support in our lives and for our most precious assets. However, the insurance industry has overlooked some important aspects such as fraud prevention and the use of technologies that help with this, perceiving negative effects even in their customers…

While insurers have been able to respond and adapt to this new normality that is the pandemic and its challenges, fraudsters have also been prepared to attack and commit fraud, which is why they have shot up considerably in various branches.

The imminent appearance of the virus and all the consequences it caused in such a short period of time led to mandatory confinement, mobility restrictions and all of us spending more hours indoors, in order to prevent and stop the spread of Covid-19.

This series of changes in habits made possible a change in the way those who seek ways to commit fraud in the insurance industry operate.

Insurance fraud has not represented a high percentage of total claims, however its evolution has not stopped growing in recent times. Fraud and fraud attempts have increased from 0.85% of the total number of events reported in 2010 to 2.21% in 2020, which represents a threefold increase in a decade.

The economic crisis will create conditions that could lead to an increase in insurance fraud cases.

Why is it important to detect fraud?

Detecting fraud has a significant impact on the premiums paid by policyholders for their policies, since the indemnities that the insurance company pays each year based on the claims that occur are the basis for calculating the annual premium.

We know that preventing them is no easy task! But with the help of technology it is possible to reduce their impact and detect them in time with our fraud funnel. With LISA Claims, we support insurers in their fraud detection. Learn more about Claims clicking here.

For more than a year, we have all been facing unimaginable changes in various areas of life, personal, family, work, companies, economies and everything that follows.

For the industries it has been really challenging to think and include new services for their clients and one of the main companies, the insurers, due to its antiquated way of operating, has had to be resilient and go against the current to meet its clients and meet your needs.

Although it is not the first time that insurers have resisted a crisis, the Covid-19 made possible a change of plans in the short term. So what have insurers done in the face of all this critical situation?

Some important data

The health crisis has made it possible to accelerate the transformation of the sector that climate change began a few years ago in the face of the increase in natural disasters: where the agricultural and health sectors indicate greater vulnerability.

The increase in risks associated with the aforementioned, makes a new strategy necessary, where thousands of organizations around the world are preparing to protect their workers.

In the Mexican case, seven out of 10 companies offered the support of a policy for their employees, 33% corresponding to individual insurance for medical expenses and 67% requested it as a group. According to AMIS data, individual life insurance corresponds to 19%, while collective to 81%.

Regarding the average amount of compensation, in individual medical expenses it corresponds to around 23 thousand dollars and the group to 19 thousand dollars. Along the same lines, individual life insurance rises to close to $ 20,000 and group life to nearly $ 8,000.

Modernization of the insurance industry

1.The commitment now to create products that anticipate the next health emergencies or other branches that may arise in the new normal.

2.Many companies that struggled to survive will now be more aware of the importance of being protected today and tomorrow.

3.The insurance industry is working to design new policies, which, although expected to be more expensive, will offer mechanisms so that organizations can protect themselves from labor lawsuits or stoppages in the event of a health emergency such as the one we have been experiencing.

4.Insurers must improve their system to encourage communication and dealing with their clients and agents, since social distancing has forced us to rethink other types of solutions to keep us communicated and operational.

5.Although natural disasters cannot be prevented, the collection of data by insurers is now a necessity, hence the new idea of ​​not only looking for solutions at the time of the accident, but also preventing them, a fact that has not been explored until now a lot of.

6.All the above goes hand in hand with technology, with which the insurance industry is more efficient, capable and safe during all its processes, accelerating them and saving costs and time.

Finally, we can summarize that all this sudden movement in the operational change of insurance companies, like many other industries, has led to a culture of awareness where those of us who were not protected before can now seek the alternatives that we have available to do so and also enable loss prevention.

Having insurance is essential even if we do not need it, that we need it and not have it.

Thanks to all this technological and critical turmoil, finally modernizing the insurance industry will not be just a necessity but an obligation if insurers are willing to retain and satisfy their customers and their next policyholders from future generations.

One of the countries with the lowest penetration in terms of insurance is Mexico, since this nation lacks an insurance culture and the figures support it:

Only 1 in 10 Mexicans has a policy and penetration within OECD countries (Germany, Australia, Austria, Belgium, Canada, Chile, Colombia, among other nations), is the lowest, standing at 2.3% in comparison with the 8.9% average of the block.

In the case of Chile, this country has an insurance penetration that many countries in the region would like to have, which is due to the reflection of development, since people acquire more goods or carry out activities such as business or travel, increasing demand for insurance.

The insurance industry in Chile is strong and highly competitive, which brings together more than 60 insurance companies, with a number of insurances contracted close to 71 million, meaning 3.9 insurances per inhabitant.

Thanks to insurance, in this nation the national GDP reaches 4.6%, one of the highest in the region.

What has happened to the insurance branches?

One of the branches most favored by the health emergency, is the vehicular, since the mobility restrictions at the beginning of the confinement, made it possible for the insured not to use their cars with the daily routine of before.

In medical expenses, the situation is more severe, because on the one hand there are the claims related to Covid-19 and on the other, the insured patients who prefer not to go to hospitals for fear of contagion.

According to figures from the Mexican Association of Insurance Institutions (AMIS), it has been revealed that approximately until August 2020, more than six thousand people with Covid-19 made use of their medical expenses insurance, who have been paid around USD $ 123,855,000.

Having this coverage exempted them from a disbursement of up to 429,000 Mexican pesos, that is, about USD $ 2,000 general expenses for hospitalization and medical care.

More than seven thousand patients lost their lives due to the virus, however they had life insurance, which is why the companies paid compensation to their relatives, close to USD $ 71,575,065.

The president of Prudential México, Mario Vela, affirms that pandemics cannot be prevented and that they historically happen every 100 years, which is why it is so important to know how to react to be prepared.

By maintaining a good insurance culture, we can be supported and safe before a loss occurs to us. Although the pandemic was a totally unprepared event, those who had the support of their insurer, were able to exempt themselves from huge monetary outlays.