AI became a key focus for insurers this year. The value of AI in the insurance market is projected to grow from USD 11.33 billion in 2024 to USD 49.3 billion by 2032. However, there’s a mix of excitement and fear about the implications of this. In this blog we’ll explain how AI is solving real-world challenges in the claims process.
Sprout.ai, the world’s most intelligent claims automation engine, uses AI to automate any part of the claims process, from first notice of loss (FNOL) to final settlement. It integrates seamlessly with existing claims management systems, enhancing efficiency, cutting costs, and boosting customer satisfaction.
Read on to discover how Sprout.ai transforms every aspect of claims management, from document processing to decision-making.
The current state of claims management
Effective claims management is essential for maintaining customer satisfaction and controlling costs. However, it often suffers from inefficiencies and delays, leading to frustration for both insurers and policyholders.
Research shows more than a fifth of consumers expect their claims to be resolved within hours. Almost every 18-24-year-old expects a resolution on an insurance claim within one week. However, 43% of customers wait over two weeks for a claim to be resolved across multiple insurance lines.
Read more: Responding to rising customer expectations in insurance – Report
This is because traditional claims management involves multiple manual steps, from receiving and reviewing documents to assessing and processing claims.
Top challenges in traditional claims management
1. Managing large volumes of paperwork manually can lead to errors and delays.
2. Different types of claims require specialised knowledge and handling, complicating the process.
3. Identifying fraudulent claims is a significant challenge, requiring sophisticated techniques and experienced personnel.
4. Manual processes are labour-intensive, demanding substantial time and effort from claims handlers.
These challenges can result in slow claim resolutions and increased operational costs, ultimately affecting customer satisfaction and loyalty. As the insurance industry evolves, there’s a growing need for more efficient, automated solutions to streamline claims management and enhance effectiveness.
Sprout.ai addresses these challenges, streamlining and optimising the entire claims management process. In the following sections, we’ll set out how it can transform claims processing.
Read more: How automated claims processing reduces costs for insurers
Claims evidence extraction and summary
Sprout.ai uses natural language processing (NLP) and large language models (LLMs) to summarise claim documents quickly and accurately in dozens of languages. It extracts and highlights key information, such as claimant details, incident descriptions, and policy numbers, providing a concise overview for claims handlers.
This reduces the time claims handlers spend reviewing documents, allowing them to focus on more complex tasks.
Example
An insurance customer submitted a detailed medical report following a car accident. Traditionally, a claims handler would spend hours reviewing the document to gather necessary information. Sprout.ai processed the documents in seconds, providing a clear and concise summary. The extracted key information was delivered in a structured way to serve downstream processes.The claims handler could then quickly make informed decisions, expediting the overall claims process and improving the customer experience.
Result
One insurer has increased capacity by over 30% with Sprout.ai and now has access to more data.
Accurate decision making
One of the standout benefits of Sprout.ai is its ability to help claims handlers make better and more accurate claims decisions. This is primarily because Sprout.ai can summarise and analyse vast amounts of information quickly and accurately.
Example
An insurer in Japan was struggling to handle highly complex medical forms, written in handwritten Japanese, which contained many data points. They used a third party to extract relevant data. However, this method only yielded 20 data points per claim, which was insufficient and slow, causing delays. This was an issue because the insurer was penalised if claims took longer than five days to settle.
With Sprout.ai, the insurer is now able to handle over 180 data points from each claim—far exceeding the previous capability. This increase in information allows for significantly more accurate decision-making.
The insurer can now easily meet their critical five-day settlement deadlines and have seen a 30% improvement in productivity, enabling quicker and more precise claims processing.
Policy checking
One of the time-consuming aspects of the claims process is policy checking, which ensures that each claim is valid and complies with the policy terms. Traditionally, this has been a slow task involving manual review of detailed policy documents. Sprout.ai transforms this process through advanced AI capabilities, for faster and more accurate policy checking.
Sprout.ai analyses claims data in the context of specific insurance policies. This involves cross-referencing the extracted information with the policy terms to ensure all conditions and exclusions are considered, ensuring every claim is thoroughly vetted against the policy it falls under.
Example
Handling home insurance claims often involves processing multiple coverage types, each governed by factors like the policy, building type, and location. This complexity means different coverages may have unique limits and deductibles based on the claim type. When a customer reports an issue like water damage, the claims handler must first identify the damage type and cause before reviewing relevant coverage, often scattered across multiple PDF documents. This manual process is time-consuming, inefficient, and prone to errors.
Sprout.ai solves these challenges with near-real-time assessments of coverage details, cutting down review time by 20-45 minutes per claim – both when the claim is reported, and every time it is updated. Its pre-trained model, tuned on thousands of policies and claims, achieves 99% accuracy from day one, even without prior exposure to specific policies. This significantly improves the speed and accuracy of decision-making, allowing claims handlers process complex claims in a fraction of the time.
Fraud detection
An estimated $308.6 billion is lost to insurance fraud in the US alone every year. Sprout.ai can both detect fraud and make it possible to check every claim for fraud.
It analyses many data points, including document metadata and historical claims data, to identify patterns and anomalies indicative of fraud. By checking details like the date, time, location, forensic details and possibility of document tampering embedded in the evidence, it can detect discrepancies indicating potential fraud.
Read more: How Sprout.ai reduces fraud and waste in insurance claims
Example
An insurance customer submitted an image showing severe damage to the rear bumper for a minor rear-end collision. Sprout.ai flagged the claim because the damage depicted in the image did not match the usual damage pattern for similar incidents. Upon closer inspection, it was revealed that the image had been digitally altered to add dents and scratches that were not present. The insurer avoided approving a fraudulent claim that exaggerated the repair needs.
Result
With Sprout, it’s possible to eliminate fraudulent payouts.
Abuse detection
Sprout.ai can enforce indemnity control by detecting abuse. The system cross-references data from various sources to identify excessive or unjustified claim amounts. This reduces financial losses due to overpayments and ensures that payouts are accurate and fair.
Example
A claimant submitted a claim stating their iPhone 15 had melted after being left in the sun. Sprout.ai flagged this claim for further review. Sprout.ai knows that iPhones manufactured after 2020 are designed to withstand higher temperatures and cannot melt under normal environmental conditions. The claim was denied, preventing a fraudulent payout.
Result
With Sprout, it’s possible to eliminate abuse.
Document tampering detection
Insurance fraud is on the rise due to the cost of living crisis. According to Allianz, there was a 300% rise in incidents where apps like Photoshop were used to distort real-life images, videos and documents between 2021-22 and 2022-23.
Sprout.ai tackles this by detecting photo or document tampering. It does this by analysing metadata and comparing document contents against known templates and historical data, identifying signs of forgery or manipulation that could easily be missed by a claims handler working alone.
Example
A driver submits a claim for a car accident, including photos of the damage, stating the accident occurred in London on July 1st, 2024, at 3:00 PM. Sprout.ai analyses the metadata embedded in the submitted photos, including date, time, and GPS location. The analysis reveals that the photos were actually taken on June 30th, 2024, at 10:00 AM, in Cambridge, not London.
Discrepancies between the claim details and the photo metadata raise a fraud alert. Based on the report, the handler can investigate further or deny the claim due to fraudulent information.
Result
With Sprout.ai, you can catch every tampered claims document.
Straight-through processing
Some insurers are using Sprout.ai to automate claims processing from first notification of loss all the way through to recommended outcome. Rather than taking days or weeks, this can be done in seconds, improving customer satisfaction and reducing costs.
Example
A policyholder submitted a claim for minor water damage to their property. Traditionally, this type of claim would take several days to process due to the manual review steps involved. With Sprout.ai’s straight-through processing, the system automatically performed all necessary checks and validations. The claim was processed and approved within minutes, and the policyholder received their payout the next day.
Result
Sprout.ai increased claims settled within five days of initial submission by 10% for the same insurer.
“Sprout.ai’s market-leading innovative technology can deliver true end-to-end claims automation with no need for human involvement.” – Director of Operations and Customer Service, South American Insurer
Complex claim management
For highly complex claims, the amount of documentation can be overwhelming. Typically, claims handlers would need to manually sift through hundreds of pages of reports, images, and legal documents.
Sprout.ai streamlines this process by:
- Automatically ingesting and digitising all submitted documents, regardless of format (handwritten notes, scanned PDFs, images, etc.).
- Summarising lengthy documents, extracting key points and relevant information. This helps claims handlers quickly understand the essentials without reading every page in detail.
- Identifying and highlighting sections of documents that are most relevant to the claim. For example, it can pinpoint crucial data like the extent of damage, expert opinions, and compliance with regulations.
Example
Consider a claim involving a catastrophic marine incident. Multiple reports are submitted, including damage assessments, environmental impact statements, and repair estimates.
Sprout.ai processes all incoming documents, extracting relevant data and summarising each document. It provides recommendations based on the extracted data, helping claims handlers make informed decisions swiftly.
Claims handlers receive concise summaries and highlighted sections, allowing them to focus on critical aspects without wading through every document.
Result
One insurer using Sprout.ai has seen a 22 day reduction in claim duration and £21 cost reduction per claim.
Processing documents that are handwritten and in multiple languages
Sprout.ai uses advanced NLP and computer vision to interpret and extract data from handwritten notes and documents in multiple languages.
Read more: Did you know Sprout.ai can process claims documents in over 100 languages, from Japanese to Greek?
Example
A claimant submitted a travel delay claim for a holiday in Greece, including handwritten receipts in Greek for hotel accommodations and meals. Traditionally, the claims handler would spend considerable time translating and verifying these documents.
With Sprout.ai, the handwritten receipts were scanned and digitised using computer vision. It extracted all relevant details such as dates, amounts, and service descriptions.
The claim was processed and validated within minutes, with the system cross-referencing the extracted data with the claimant’s policy terms and conditions.The claim was approved swiftly, and the policyholder received their payout within a day.
Result
One insurer has boosted tNPS (transactional Net Promoter Score) by +25% with Sprout.ai.
What can Sprout.ai do for you?
- 48% cost reduction in claims operations
- Elimination of fraud, waste and abuse
- £21 cost reduction per claim
- 22 days reduction in claim duration
- 60% increase in claims automation, allowing teams to spend more time on customer interactions and complex cases
- Over 30% capacity increase for claim handlers
- 99%+ accuracy in claims processing
- +25% tNPS (transactional Net Promoter Score)
Conclusion
Sprout.ai’s capabilities are vast and transformative, offering insurance companies the tools they need to streamline claims processing, reduce fraud, and improve customer satisfaction.
Unlike some AI solutions, Sprout.ai can be seamlessly integrated with existing claims management systems. It works in the background, behind existing claims systems, so teams don’t need new training to quickly start benefiting from enhanced efficiency and accuracy.
