Predictive Analytics can improve and automate claims segmentation, reducing costs and improving customer experience.
What is Claims Segmentation?
Claims Segmentation is a real-time solution which enables insurers to automatically push claims down the appropriate line of business (segment) based on the probability of a claim being fraudulent. Be it sending a low risk claim the Fast Track route, or sending a high risk claim directly to Special Investigations Unit (SIU). This improves line of business process both by improving the odds of a claim sent to SIU being fraudulent and by reducing/negating assessment costs on low risk claims
How it works?
Each claim is automatically assigned a risk level by the model at claim registration and then distributed to the appropriate processing channel for settlement or further investigation. This solution can be integrated with the existing LOB systems and user/assessor intervention is optional.
Santam is South Africa’s largest short-term insurance company. With more than 650 000 policy holders and assets under management of R 17 bn, the company enjoys a market share of more than 22 %. Santam operates in a market where fraudulent activity can account for an estimated 6 to 10 % of all premiums. Santam wanted to find a way to improve its service to customers by settling claims faster and keeping premiums low. To achieve this, the company needed to maximise operational efficiency and find smarter ways to combat fraud. Santam worked with us to design a claims segmentation solution based on SPSS predictive analytics software. Our solution needed to integrate seamlessly with the current Santam claims process, and allow for a real-time scoring of each claim with a sub-second response rate. The solution works on a claim by claim basis.
The solution offered by our team:
- Enhanced Santam’s ability to detect fraud, foiling a major crime syndicate and saving R 17 m in the first four months of operation.
- Improved customer service by enabling legitimate claims to be settled within an hour, more than 70 times faster than before.