Independent adjuster expense leakage on Hurricane Irma claims alone could be more than $40 million.
Hurricanes Harvey, Irma and Maria are three catastrophic events we will be talking about for some time. During this chaotic time, affected insurance carriers are left to deal with claims influx from multiple catastrophic events all at once. Managing the additional resources needed to process all of this activity can be a daunting task, placing a significant strain on an organization.
Because the property and casualty insurance industry has been slow to automate its processes, a constant challenge during catastrophic events is the process of adding additional adjusters, changing fee schedules and maintaining the vetting process to ensure you are getting top quality adjusters. Managing increased volume, different contracts and complex fee schedules is often a manual process that can easily become overwhelming. Manual processes are time consuming, resulting in additional resource usage and a greater risk of leakage.
In a catastrophe, leakage of independent adjuster (IA) expenses is estimated at 13%-15%. This correlates to 2%-4% on the total loss adjustment expense ratio. There are currently more than 500,000 reported Hurricane Irma claims. Using these estimates, independent adjuster expense leakage on Hurricane Irma claims alone could be more than $40 million.
With a record volume of claims to adjust, managing the expenses associated with adjusters can be a challenging task. Manually reviewing the influx of invoices leads to inefficiencies and leakage. Innovative solutions can result in significant savings.
If you could automate the process of reconciling and reviewing invoices…would you?
There are many benefits to eliminating manual processes within this mundane part of the claims cycle. Automating the process of auditing invoices gives your claims team more time to focus on processing claims and reducing the claim cycle time. IA firms receive payment quicker, leading to more loyal firms. Automation improves leakage ratios, which reduces your ultimate loss adjustment expense, allowing you to outperform your competitors.Learn More