EXL’s client, a leading US insurance company, struggled with managing an increasing claims volume, improving customer experience through faster turnaround times, and efficiently managing fraud while adding capacity for higher value-add and project-based work. Certain processes were seeing up to 40% year-over-year growth in volume, further exacerbating the pain points and leading to higher hiring and training costs. In order to manage these volumes, the client had 150+ employees spread across three locations.

The insurer wanted to execute a plan that enabled end-to-end claims transformation leveraging robotic process automation (RPA), data analytics, and a transformed operating model utilizing a global talent pool. As a strategic digital transformation partner for this client, EXL helped the client envision the claims digital transformation journey, creating a one-stop-shop for all of these capabilities leveraging the deep industry domain experience and best practices. These capabilities were then expanded throughout the organization, leading to widespread benefits across multiple product lines and functions.

Context

Over the past decade, EXL has partnered with the client across multiple engagements to disrupt the claims function in a phased manner. This began with a proof of concept, and expanded to building analytical models, developing BOTs for auto-adjudication, and tapping into global labor pools.

Over time, EXL created a heat map to show how the solutions it created for claims processes could be expanded to other areas of the client’s business.

Orchestration

EXL enabled this claims transformation with two key guiding principles:

  • Design for benefits across multiple dimensions (e.g., customer satisfaction, efficiency gains, employee satisfaction) through automation, along with efficiency benefits / cost savings
  • Re-imagine and implement new clean sheet process, incorporating design thinking where relevant and leveraging the full set of new automation tools and techniques (e.g., BPM,RPA, NLP, WFA , ML)

The team started out by capturing historical claims data, both structured & unstructured, and developed machine learning algorithms to classify the claims into “simple”, “intermediate” and “complex” claims. K-neural networks (KNNs) further helped categorize claims into “high”, “medium” and “low” fraud propensity claim clusters. In combination, these analytics models helped identify simple claims for auto-adjudication while more complex claims were triaged for manual processing. Fraud models further helped assign only claims with high fraud propensity to, increasing the utilization of the Special Investigation Unit (SIU) in a cost effective way.

EXL introduced bots using Robotic Process Automation (RPA) technology to automate the claims operations from extracting information from claims documents, gathering information from systems and external websites and consolidating the claim for easy adjudication. The RPA solution was integrated with the client’s business process management (BPM) platform to provide aggregated information to the adjudicators through a single user interface. The solution had the capability to switch between bots and humans throughout the claims process. The integrated bot and human claims process, orchestrated by the BPM platform allowed greater insights and effectiveness of the claims management.

Finally, EXL created a Claims Center of Excellence leveraging global talent pool taking over the bulk of the client’s claims function, allowing client to retain only more complex claims tasks were funneled to the client’s retained teams.

The resulting success of this initial claims transformation led to EXL creating an enterprise automation program for the client. By creating an automation Center of excellence, bots were developed for multiple areas including:

Outcomes

The client had historically sent only 0.2% of their claims to a special investigation unit (SIU) to determine whether suspicious claims were actually fraudulent. EXL deployed extensive analytics programs to segment claims as either having a high, low, or no possibility for fraud. EXL helped increase the referral rate to 5% for fraud investigation, and enabled the client to save $21M of potential fraud.

Customer service metrics saw an improvement as well. The client saw a 3% increase in voice of customer scores, and a 40% reduction in average claims processing times.

Collectively, the analytics, automation and sourcing levers helped in releasing over 50% capacity in the claims function with the retained organization consolidated at only one client site to focus on value added and complex work for their strategic customer relationships

The client found the claims transformation program to be a resounding success and basing this effort, created a digital transformation office to evangelize digital initiatives like robotics and AI, encouraged business units to reimagine their processes and helped them build solutions. This positioned the client to choose the right projects in the future by better estimating their benefits and ease of implementation. Across the organization, the digital initiatives started yielding outcomes across the organization. Processing times improved in multiple areas. The policy administration function automated to lower the time it took to designate a beneficiary from five to six minutes to under two minutes, which saved approximately 60-70 hours per week. The wealth management unit’s process to appoint advisors also saw a drastic reduction in turnaround times, going from an average of three weeks to appoint an advisor to most appointments being made overnight.

These and other improvements translated to an impact on the bottom line. The client saw an approximate $2M in annual run rate savings by quickly developing bots across new business, policy administration, finance etc. Just as important, though, were the impact to employee and customer experiences

Moreover, this program significantly improved the business resiliency that helped minimize impact during COVID-19. The digital transformative solutions proved their worth with ability to sustain operational processes impacted during the pandemic and ability to easily scale up for increased volumes.

This solid base in digital transformation will also enable the client to focus on larger digital endeavors including paper digitization, chatbots, cognitive voice assistants, and other areas.

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