The recent Insurance Times article, “Ombudsman complaints reveal insurers are still struggling with claims,” highlights the insurance sector’s persistent struggles with claims processing. The Financial Ombudsman Service (FOS) reported nearly 30,000 claims-related complaints in the 12 months leading up to September 2024, accounting for 71% of all insurance grievances.
These statistics indicate a critical issue: insurers are failing to meet increasing customer expectations. Complaints linked to declined claims (41%), delays (23%), and disputes over claim values (8%) reveal an urgent need for more efficient, accurate, and transparent claims handling.
While these challenges are not new for the insurance industry, the solutions available to combat them are. Emerging technologies, particularly artificial intelligence (AI), have the potential to reduce complaints and deliver a smoother, faster experience for customers.
Addressing claims delays with AI
The Insurance Times article highlights delays as a significant cause of customer dissatisfaction, which is unsurprising given that research indicated 21% of insurance customers expect claims to be settled in hours, yet 43% wait over 2 weeks.
Read more: These stats are from our research report ‘Responding to rising customer expectations in insurance’
Manual claims processes are generally very time-intensive. The required data extraction, document analysis and fraud checks are repetitive and take up a significant amount of claim handlers’ time. Sprout.ai automates these tasks, enabling claims to be processed in less than 20 seconds on average, instead of the process taking weeks.
Sprout.ai can quickly analyse claim forms, validate policy details, and notify claims handlers in the event of any inconsistencies. This reduces bottlenecks and helps insurers resolve claims faster, directly addressing the frustration caused by processing delays, which contributed to 23% of complaints according to the FOS data.
Improving accuracy to reduce complaints
For 70% of UK consumers, trusting that their decision was made fairly is the most important factor during the claims process, yet 8% of the claims recorded in the Insurance Times article arose from disputes over claim values – often arising from inaccuracies in claim assessments.
Manual claims processing can be error prone, which ultimately leads to increased delays, disputes and customer dissatisfaction.
Sprout.ai captures data with up to 99% precision, reducing errors and ensuring the fair, consistent outcome customers expect, thereby increasing customer satisfaction, trust and reducing complaints.
Read more: Discover what customers really want in our research report ‘AI and Claims Processing: What Customers Really Think’
Transparency: keeping customers in the loop
Another key takeaway is the importance of communication. Lack of transparency creates unnecessary anxiety for customers, leaving them in the dark about their claim status. For 45% of UK consumers, having visibility into the current status of their claim is the most important factor in a positive claims experience, while 44% value the ability to access claims evidence above all else.
Sprout.ai ’s products have been built to ensure that the rationale behind the AI’s decision-making process is clear and simple to understand. The decision-making process is more transparent, and handlers can explain decisions more easily.
Read more: How leading insurer, Zurich, partnered with Sprout.ai to enable claims automation ‘Zurich UK can now settle claims in real time’
Benefiting insurers and customers alike
The challenges outlined in the Insurance Times article make it clear that the insurance industry is at a crossroads. With nearly three-quarters of all complaints tied to claims issues, insurers face growing pressure to improve speed, accuracy, and transparency in their processes. The good news is that solutions like Sprout.ai are already proving to be transformative.
“The key […] is recognising AI for what it truly is: a tool to supplement and support, not replace, people and expertise. Ultimately, the next ten years will determine which organisations have the purpose-driven leadership and determination to shape the future insurance success stories and which will become the brands of the past.”
Sprout.ai exemplifies how AI can be the enabler of this transformation. By addressing fundamental claims challenges – delays, errors, and poor communication – Sprout.ai empowers insurers to deliver a better customer experience while building a stronger, more resilient industry.
