Why the Future is Bright for Workers Comp
The past few years have been marked by uncertainty in the workers comp industry. New working styles, shifting cost concerns, lagging tech adoption and other changes have all led to major changes.
Given all this change, why is the future so bright for workers comp?
Because these transitions are speeding up the digital transformation in insurance. The potential for implementing workflows that both improve efficiencies and create better outcomes for workers is just around the corner.
Here are 10 reasons why insurance professionals can get excited about the future of workers comp:
The digital transformation has just begun and will continue to drive efficiencies. According to the 2022 Workers’ Comp Industry Insights Survey Report, claims process automation is the number one most important technology for insurance carriers, TPAs, and MCOs in the next 3–5 years. The digital transformation not only helps them do more with less but also helps them solve complex problems more quickly.
Technology will fuel new opportunities. AI, new data sources and increased processing power will help insurers improve their workers’ comp offerings. Not only is the workers’ compensation technology improving to create greater claims efficiencies, but technology is also changing how workers navigate their workers comp experience e.g. videoconferencing for risk management, virtual claims assessments, telehealth and wearables.
Digital assistants are at the beginning of the adoption curve. As the volume of connected and smart devices rise, digital assistants present new opportunities to both keep workers healthy and to make the claims process more efficient. Personal digital assistants can help workers make safer decisions, understand their benefits, file claims and manage their cases.
Technology can offset inflation and recession. While inflation is negatively affecting costs and rates are being pushed lower by regulators, there are strong technology solutions available to reduce losses. Actually settling claims—and settling them with optimal outcomes for the insurer and the claimant—and avoiding litigation are guardrails against the impact of inflation.
Technology can ease generational knowledge transfer. The changing workforce is the top concern among workers comp industry stakeholders. Baby boomers are retiring, meaning insurers will face a generational transition of adjusters over the coming years. AI and other technology solutions can help to codify and transfer knowledge to new claims adjusters.
Hybrid work means a larger talent pool. While 71% of workers comp stakeholders are worried about attracting and retaining talent—and have been for years—the COVID-19 pandemic has fundamentally changed the way we work. The evolution of the flexible workplace will provide new opportunities to hire the best talent across the world while giving employees more job satisfaction. This can help organizations recruit for claims professionals and IT roles, two areas of top concern.
Carriers are embracing the insurtech movement. Although slow to adopt compared to other industries, the COVID-19 pandemic forced many insurance institutions to rapidly advance their plans for digitization. Insurance leaders are now working internally and with partners to deploy insurtech in combination with the right mindset, skillset and culture.
Executives are open to disruptive thinking. Just as they’ve learned to embrace insurtech, insurance leaders are recognizing the value of industry disruptive thinking. Some new tech companies are looking to disrupt insurance but don’t have the benefit of industry experience. Those well-tenured insurance leaders who embrace that same disruptive thinking and look for new ways to improve workers comp can gain a competitive advantage by meeting customer demand.
The industry is maturing to become data-informed, not data-driven. The insurance industry is already maturing from a “data-driven” to a “data-informed” vision of the future. A data-driven organization uses data to dictate the decision-making process. A data-informed organization trusts the instincts of its insurance professionals to use data as one more tool in their toolkit, powered by technology such as natural language processing (NLP). The technology doesn’t replace claims professionals; it helps them to do their jobs better.
The worker is moving to the center. Carriers are embracing the strategy of providing injured workers the best care versus the minimal level of care. The old way of thinking was that claims efficiency and technology came at the expense of the patient, prioritizing the cheapest or fastest option. But artificial intelligence can analyze greater amounts of data to help claims professionals spot potential concerns in a worker’s case and identify the best providers for specific injuries, all leading to better outcomes for injured workers.
The future looks bright.
The digital transformation in workers comp has just begun and will only continue to drive efficiencies for optimal claims outcomes. By combining industry expertise with technology, insurers can leverage the power of data and machine learning to provide a better claims experience.
Curious how CLARA shines a light on your claims data? Request a demo today.