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How Data Analytics and Customer Experience are Reshaping Auto Insurance

September 27, 2023

In a recent episode of Conversations on the Creek, I Mathew Stordy and Rob Savitsky from Duck Creek Technologies had the chance to engage in an insightful discussion with Tanner Sheehan, the VP and General Manager, Claims Solutions from LexisNexis Risk Solutions.  

The key topics of this enlightening conversation were the evolving landscape of U.S. auto insurance and the role of data analytics in transforming the claims process.  

Below, we share the three key takeaways from this discussion. You can also listen to the full podcast here

A Good Claim Experience Drives Policyholder Loyalty 

Tanner’s first key insight from their Auto Customer Claims Experience whitepaper draws attention to the strong correlation between the claim experience and customer retention.  

Remarkably, policyholders who have previously filed a claim are 35% more likely to switch providers within a six-month period. Moreover, one in three consumers attribute their desire to change providers to their claims experience.  

These figures underscore the pivotal role the claims process plays in customer retention, underlining the necessity for insurance carriers to prioritize policyholder experience in their claims handling. Insurers looking to retain their customers will need to ensure that the journey of making a claim should feel less like a battle and more like a supported journey. 

See also: Delve deep into the purchasing habits, knowledge of insurance innovation, and openness to new products from insurance customers globally in our 2023 consumer survey.

Examining Self-Service in Claims Processing 

Tanner also revealed an intriguing insight into the growing importance of self-service in insurance claims processing.  

He shared that policyholders heavily relying on self-service were 74% more likely to contemplate a switch in carriers, indicating a pressing call to action for insurers to move beyond checking the box for offering self-service, and to think more critically about how to enhance their self-service experience.  

To this, Rob also added that policyholders may prefer a human connection to know that their claims were being processed or that their applications were going in the right direction.  

In essence, while today’s consumers do seek convenience, autonomy, and speed, a balance between automation and personalized service appears to be the optimal strategy.  

This balance not only caters to the desire for efficient self-service but also acknowledges the need for human interaction, offering policyholders a comprehensive and satisfactory claims experience. 

The Power of Data Analytics in Claims Resolution 

When it comes to insurance claims resolution, data and analytics have emerged as revolutionary tools, serving as a catalyst for accelerated processing times and enhanced customer experiences.  

As Tanner explained, carriers that harness the power of data analytics invariably improve their claims resolution speed, a testament to the efficacy of these tools. However, it’s crucial to understand that the potential of data analytics extends far beyond mere speed.  

When used to their full potential, they can serve as formidable aids for claims predictive modeling, fraud detection, workflow optimization, and other aspects, thus opening avenues for better control, cost savings, and ultimately, a more satisfied customer base. 

In conclusion, insurers looking to excel in the evolving auto insurance landscape must enhance their claims experiences, balance self-service with personalized care, and leverage data analytics to boost customer satisfaction and loyalty.

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Mathew Stordy
Director of Technical Solution Consulting
Mathew Stordy is Director of Technical Solution Consulting for Duck Creek Technologies. Stordy leads Technical Solution Consulting which provides solution engineering and technical product support during the sales cycle. Prior to joining Duck Creek Technologies in 2020, Stordy worked for LexisNexis Risk Solutions where in his last role he was responsible for driving the development of data analytics solutions for the commercial insurance market. During his career Stordy has worked extensively in the insurance software and data analytics industries focusing on policy administration systems, quoting applications, business intelligence, and data analytics solutions. He holds a bachelor's degree in mathematics and a master’s degree in philosophy from the University of Connecticut.