A Guide to Efficient Insurance Document Processing

Faheem
4 min readMay 27, 2024

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Insurance Document Processing

In the insurance industry, nearly 97% of data is unstructured, coming in the form of emails, text-based documents, medical records, credit card statements, etc. Also, invaluable information is contained within claims adjuster’s reports, which often consist of jargon, abbreviations, and other shorthand. Considering that most of the data and documents are unstructured and stored in siloes, it comes as no surprise that less than 3% of the data is used by insurance businesses to make decisions. This figure alone showcases the untapped potential of this sector. As such, intelligent document processing, or IDP emerges as a powerful solution. This transformative solution leverages cutting-edge technologies to efficiently extract meaningful data from unstructured and semi-unstructured files, thereby furling accuracy, innovation, and cost savings.

In the document-heavy insurance industry, manual document processing contributes to inefficiencies, data errors, inaccuracies, security and compliance risks, and ultimately impacts customer satisfaction. Intelligent insurance document processing emerges as the best approach for handling sensitive information while ensuring operational efficiency, security, accuracy, and compliance. Let’s explore the benefits of intelligent document processing in the insurance industry.

Benefits of Intelligent Insurance Document Processing

Here are the key areas where insurance document processing can benefit insurers:

Streamlined Underwriting Review

Traditionally, the documents and data with which underwriters work are typically in an unstructured form. Underwriters have to sift through PDFs, postal mail, fax, and other types of documents for manual review, relevant data extraction, and transcription. Not only is this more error-inclined, time-consuming, and costly, but also quite redundant. To rid the underwriters of this burden, insurers must look into automated insurance document processing solutions. IDP standardizes the process to a large extent, enabling underwriters to make quick decisions based on relevant, and accurate information.

Efficient Policy Administration

Insurance policies are not set in stone. They can be changed even after they have been issued. The changes are typically made to accommodate new needs or circumstances. For instance, if a life insurance policyholder buys or re-mortgages a property, they can extend the policy term to cover the mortgage repayment period. Making changes to the insurance policy falls under the ambit of policy administration. Insurance policy administration also involves a multitude of other tasks such as quoting, policy creation, renewals, cancellation, and termination. All of these activities involve a horde of documents. An ideal intelligent document processing solution for insurance policy administration can help transform unstructured and semi-structured data into usable information.

Fast-Tracked Claims Processing

Like underwriting and policy administration, claims processing is also a document-heavy activity. Manually handling these documents can be a tasking endeavor. Claims adjusters have to manually verify the information, input the relevant data into the system, route information, etc. This often contributes to delayed claims approvals and settlements. Insurance document processing can significantly streamline insurance claims management to improve accuracy and efficiency. When combined with technologies such as Optical Character Recognition (OCR), Natural Language Processing (NLP), and Machine Learning (ML), the advanced document processing solution can automate the handling of all claims-related documents. Intelligent document processing for claims not only improves efficiency but also improves fraud detection. IDP helps insurers flag suspicious documents in real-time for further manual review. As a result, insurers can enjoy tamper-resistant document processing that saves time, money, and potential losses.

Factors to Consider When Implementing Intelligent Document Processing Solution for Insurance

  • Data Security: When deploying an insurance document processing solution, prioritizing data security and privacy becomes essential. Since insurance businesses deal with sensitive information, they should choose a solution that can effectively protect confidential data and documents against new-age threats. Security measures such as encryption and access controls will allow insurers to safeguard the documents against threats.
  • Integration: To make the most out of the investment, insurers need to ensure that the new solution that can seamlessly integrate with the existing systems, data points, and workflows. Choose a system that is compatible with the current IT infrastructure and business applications, such as CRM, claims management software, underwriting systems, accounting software, etc. This promotes data consistency and causes minimal disruption to user experience.
  • Customization: Selecting the right document processing solution for insurance companies requires careful consideration and understanding of the specific business needs. Since all businesses have their unique needs, it is best to select a solution that can be customized to meet them.
  • User Training: when rolling out a new document processing solution, it becomes crucial to provision for training and change management. While most insurance document processing solutions are user-friendly, it is still relevant to reach the employees about how they work and their functionalities. It will help overcome resistance to change.

Conclusion

Intelligent insurance document processing unlocks various opportunities for insurers to streamline document management, drive efficiency, and unlock actionable insights. With the strategic implementation of IDP, insurers can reduce reliance on intuition, minimize the risk of error, and stay ahead of the curve.

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Faheem

Faheem is an InsurTech specialist & a passionate Insurance Technology Blogger with remarkable experience of 17 years, working with clients all across the globe.