How claims departments are becoming innovation breeding grounds.
By Eric Gilkey
Channeling Apple’s iconic marketing slogan in a headline (some would argue a more grammatically correct version) necessarily means turning to the company’s legendary leader Steve Jobs for one of his memorable quotes on innovation: “To turn really interesting ideas and fledgling technologies into a company that can continue to innovate for years, it requires a lot of discipline.” He also wrote, “Innovation distinguishes between a leader and a follower.”
Certainly, the two companies on the following pages are innovators in their spaces. They both illustrate the foresight and ingenuity needed to not only recognize opportunity, but also to capitalize on it. Take a look at how they are embracing technology and marrying it to solid work processes in order to solve some of their—and the industry’s—biggest problems and frustrations when it comes to costs and efficiency.
WeGoLook for Solutions
Willis Tower Watson’s (WTW) quarterly InsureTech Briefing for Q2 2017 reported that “Crawford & Company’s acquisition of a majority equity interest in WeGoLook (WGL) in January 2017 marked one of the largest strategic investments to date in an emerging InsureTech start-up focused on the claims sector.” WTW’s Chief Executive Officer Rafal Walkiewicz further commented that “it is also one of the most innovative.”
So what is WeGoLook, and what makes it so innovative? Similar to services like Uber and Airbnb, WeGoLook is rooted in the utilization of crowdsourcing and the “gig” economy through the use of more than 35,000 professionals who only need one tool to get started: a smartphone.
“WeGoLook is about sourcing a part-time temporary workforce—we call them ‘lookers’—who are able to undertake, through some training, specific tasks typically associated with [documenting] a loss, and the ability to deploy that workforce close to where it is needed as opposed to a traditional company that builds its network by increasing the number of offices,” says Ken Fraser, Crawford & Company’s executive vice president and chief strategy and development officer.
Fraser says his company first hit on the idea of developing a lower-cost service that would validate and verify simple losses during a strategic planning meeting that looked at the future of its claims model. His hope was to reduce the friction of claims handling for certain auto and property losses that would lend itself to this type of approach.
“Having described what we ideally wanted to work towards as part of an overall progressive claims model, we then went looking to see if there was anything already out there that fit with our vision,” says Fraser. “Very quickly, we discovered WeGoLook and, frankly, it was a pretty fast marriage. We met with them in July 2016 and, by October 2016, we had agreed to terms.”
Fraser says WeGoLook is just one aspect of a futuristic progressive claims model that Crawford is continuing to develop, but he believes it will be a very unique service in the claims field adjusting process. “We are investing heavily in it as we speak to help it accelerate our own plans,” he says.
Fraser makes it clear that he sees a layered, interconnected approach to claims handling evolving, one that includes artificial intelligence and a continuation of the utilization of field claims professionals in addition to its WeGoLook service model.
“WeGoLook is just one part of it,” he says. “We anticipate that artificial intelligence (AI) will start to provide settlement estimates for high-volume claims in lines such as auto. However, if the AI in the algorithm doesn’t create a high confidence level on the settlement, then we would progress to the next level, which is where WeGoLook comes in. In the small percentage of cases where one of those two steps doesn’t result in a satisfactory loss assessment—or the complexity of the claim is just too high—then we would deploy a qualified professional loss adjuster.”
Fraser says being first to market with an innovative solution was a challenge for WeGoLook and for others who are being innovative, but believes that as customers begin to embrace changes to the traditional claims model, they will see the benefits.
“The simple transaction of validating a claim or some other piece of information has been simplified so much that sometimes it is tough for a carrier to believe that it can be so effective,” says Fraser. “As for the future, what is becoming an added value is how we can improve the service using data mining and analytics. The speed with which we get to an insured is measured in hours, and so claims time cycles have come down dramatically since we started. With our next generation of the platform, we will be able to geo-track all of our lookers to create even more efficient routes.”
While at times it seems that property and auto lines receive most of the headlines when it comes to innovating with technology, there are advancements taking place in workers compensation, too. Specifically, investigational approaches in this line are seeing a renaissance of creativity that is aided by the artful use of high-tech cameras.
“In the investigative market, there really hasn’t been significant progress or impact made through innovation other than the social media access,” says Raymond Therrien, chief executive officer for Delta Group, an investigative company that focuses 70 percent of its business on probing workers compensation claims. “When I was a broker at Marsh, though, I started hearing from some very large employers who were saying, ‘We’re using this really cool technology, and it’s helping with our claims.’”
Therrien, who also has a background in claims handling, soon joined Delta Group and discovered that it was experimenting with pinhole-sized, high-definition cameras by putting them in objects like construction barricades, barrels, and traffic cones in order to discreetly capture previously difficult-to-get surveillance.
“We have around 13 device types, which are each best suited for different situations,” says Therrien. “We construct the devices and install the cameras ourselves, and the cameras can pan, tilt, and zoom. They have night vision and live-streaming capabilities, and they can withstand all temperatures and climates.”
It’s helping solve one of the biggest complaints and frustrations from employers and carriers when it comes to in-person surveillance: The “no activity detected” report. What was an expensive guessing game as to when a claimant was going to be active is resolved with 24 hours of non-stop, high-definition recording. But how can claims professionals be expected to scour what can be 100 hours or more of recording?
“We have analytical tools and programs that comb through the video to capture and create ‘highlight reels’ that are an hour or two in length,” says Therrien. “Our staff is trained extensively, and a lot of them come from the ADTs of the world, so they arrive with a security background in cameras and are experienced in surveillance.”
As an example, Therrien described a case in which surveillance was needed of a claimant in a rural area of Alabama who was suspected of workers compensation fraud, but traditional methods had, up to that point, failed spectacularly.
“The claimant was so aware of surveillance that he would come out every morning and look up and down his block for parked cars,” says Therrien. “If he saw one, he would approach it—twice he did so with a shotgun in hand. When he came out and saw our construction device, though, he thought nothing of it and, for the next five days, proceeded to cut down and haul trees from around his farm. Remarkable, since this was supposedly a totally disabled individual who was unable to work at all.”
As with any technology, there can be downsides—sometimes comical ones. Take, for instance, the neighbor who scooped up a recording device disguised as a construction barricade and used it as a sawhorse to cut wood in his garage.
“Since all of our devices have GPS onboard, we went to them in our shell company attire and retrieved it—he claimed that he thought we had forgotten to take it with us,” says Therrien.
Therrien says his other concern is that plaintiffs’ attorneys will start to catch on and begin educating their clients on what to look for. “Plaintiffs’ attorneys might coach up their claimants, but it only takes one weak moment where they forget what they’re doing. If they do, then we’ll capture it.”