Mobile technology can advance the speed of claims resolution and loss analysis and tighten the control of risk management data.
By TOM STARNER, a freelance writer who specializes in reporting and writing about technology
Mobile computing, driven primarily by continued growth of hardware such as smartphones and smaller, more versatile tablet devices, is taking off.
It should come as little surprise then that those same hardware devices are beginning to make an impact within the property and casualty insurance industry and risk management profession.
Mobile computing, in fact, is becoming a critical success factor in conducting business and enabling insurers and risk managers to be effective technology users. For the risk management and insurance industries, mobile computing can usher in a new era with the potential efficiencies of mobile devices, including entering new claims and resolving them faster, automating accident investigations, documenting on-site workplace safety inspections, including photos and using social networking to communicate internally and externally.
“Obviously, there has been a lot going on over the course of the last couple of years,” said Chicago-based Tom Kavanaugh, a consultant with PricewaterhouseCoopers’s Diamond Advisory Services. “The smartphone and the re-emergence of the tablet, driven by Apple and a more competitive marketplace, offer a new technology engagement model.”
Kavanaugh said consumer expectations that arise from the use of Amazon, Facebook and other experiences have raised overall engagement of traditional business to consumers. But now, on these newer, smaller, smarter devices, there is availability and access on a 24/7 basis.
“People are interacting with one another, texting, commenting on pieces, making payments and purchases,” he said. “Those behaviors are sure to spill over into the world of insurance and risk management.”
Of course, Kavanaugh said mobile hardware in the form of laptops and netbooks still have a place, but smartphones reside “in the pocket,” and can engage risk management and insurance professionals in an entirely new way.
“With this type of device, they have a technology construct with them everywhere they go,” he said. For example, as the risk management platform is extended to smartphones or tablets, these technologies can be used at a warehouse and be designed as a preventative rather than a reactive tool on the safety and claims fronts. Applications, for example, that can detect when a steam boiler is running hot and could explode and transmit an immediate alert to a risk manager, potentially preventing a catastrophic event from happening.
“Over time, the technology model will change,” Kavanaugh said. “We will move from being reactive in terms of something happening to much more focused around risk prevention and claim avoidance.”
Kavanaugh said he sees insurers and risk managers already embracing these new devices, providing and using smartphone apps for initiating the claims process, for example.
Tani Pack Downing, Utah’s risk manager, said her department is in the middle of a long-term claims system overhaul. And as part of that effort, she hopes loss-control personnel in the field eventually will be equipped with smartphones that have camera and email capabilities. “Right now, they need to take a photo on a camera, upload it, sort it all out and spend time in the office doing paper work,” she said. “The goal is that they be able to do all of that in the field and not have to come into the office.”
For example, should a loss-control person inspect a school and see a live electrical socket in need of repair, right on the spot they could send a photo of it to the central office to initiate a repair. Or, a claims adjuster could visit a flooded area and shoot photos and upload them or a claim directly to the Utah risk management office, without using a laptop and camera.
“Email capability is the first step, as that allows the work to be on any smartphone,” she said. “Eventually, it is going to change our lives, but being a public entity, we have to make a strong business case that we show it can make a difference.”
Jackie Hair, executive director, risk management at Ingram Micro Inc., a Santa Ana, Calif., technology supplier, said the recent earthquake and tsunami in Japan clearly demonstrated how fast information can move with the technology improvements and enhancements smartphones offer.
“If you were an organization with a heavy employee population in Japan, or even in New Zealand or Chile, you could be able to assess the impact of the damage very fast,” she said. “These devices represent an incredible way to get info to where it’s needed the fastest. I believe they are going to revolutionize the way risk management works.”
Hair said while risk management and insurance are still “on the cusp” of widespread adoption of these devices, the fact that they can allow one to get online and transmit, receive or confirm data no matter where one might be at any given moment is a game changer.
“We had not even thought of this scenario just a few years ago,” she said. “When I have questions and issues, these tools can provide an incredible resource. They can help explain to my management or carriers what I am doing and why. They potentially are huge productivity tools. Even laptops are starting to seem cumbersome in comparison.”
Ingram Micro, which has 35,000 employees and operations in 37 countries, primarily is a warehouse logistics distribution provider. Ironically, Ingram’s business side is “hugely automated,” but the risk management function, at least until recently, was not on the same level. Hair expects that to change within the next few years, and plans on using as much of the new mobile technology devices she can to make that happen.
For example, when a large loss occurs, apart from carriers being notified almost immediately, risk management can send out notices to all levels of senior management.
“We want to be able to have something they can access, and they want mobile technology that allows them to get information and read reports, but they must be able to open such reports and attachments on mobile devices,” she said.
Bob Morrell, co-founder and CEO at Marietta, Ga.-based Riskonnect, a provider of enterprise technology for the risk management industry, said being tethered to a laptop or desktop will fade from the picture within a few years. Plus, when today’s risk managers buy risk management information systems (RMIS systems), they are thinking 10 years out, he said.
“They want to know how people will access information not just now but in the future,” Morrell said. “These new devices can do a lot more than check email. If a RMIS or other risk management technology doesn’t work on these mobile platforms, you will have trouble.”
The key, he said, is it’s not just enough to say it will run, but that it will run effectively in an environment that has no traditional keyboard but rather, a touchscreen.
“There have been a lot of stops and starts over the past decade with mobile computing, but when (Oracle CEO) Larry Ellison predicted the death of the PC 15 years ago, his predictions were accurate. His timing was just off,” Morrell said. “You can say these devices are making that happen.”
Gordon Clemons, chairman of Irvine, Calif.-based CorVel Corp., a national provider of disability management services and solutions, has little doubt about the smartphone and tablet hardware platforms playing an integral role in the insurance and risk management world.
“We’re seeing the same thing everyone else is seeing, and I am not sure if it’s overhyped at all,” Clemons said.
He said that the laptop computer’s role in the insurance industry was a major advance, but now it pales against the potential smartphones and tablets offer.
“The first time I got a smartphone in my hands, it immediately made me think, ‘This feels like something big,’ ” he said. “Statistics show that pretty much everyone will have a smartphone and/or a tablet in their hands within two years. It represents a tremendous opportunity both for risk managers and any company related to the insurance industry.”
Gray Construction, a large U.S. contractor based in Lexington, Ky., is using smartphones and tablet technology for recording and monitoring data on construction projects around the world. Gray’s Randolph Wilson, director of technologies, said that began three to four years ago with photo taking and risk assessments via personal digital assistant devices (PDAs).
“Our first iteration was a PDA platform, which was a small smartphone form factor with a very small screen,” Wilson said. “The second iteration was with tablet PCs with no keyboard and a bigger form factor, so there was more screen real estate. But the tablets now have high contrast screens, along with 3G networks and wifi.”
Gray is in the process of migrating that technology to the iPad, Wilson said, because the iPad-type form factor brings the needed requirements to a different, more reporting type of device.
“The mantra we use here, make it as easy as we can for the users, regardless of the device,” he said.
Jon Wright, manager of quality management systems for Gray, said the key risk management pieces are the measurability and predictability for tracking data, not only in building an accurate baseline, but helping develop what he calls a “learning” atmosphere.
“From the quality control side, having those devices provides an invaluable real-time data collector, but it also can improve safety because we are catching current conditions and behaviors,” he said, noting that on a daily basis there are about 100 Gray employees using smartphones or tablet devices in the field.
“The challenge is bridging the gap between old and new platforms,” he said. “It’s a large undertaking to move from one to another, and keep consistency with data.”
The high mobility of these new devices helps Gray document its projects much more thoroughly. And that is important when one is controlling risk in uncontained locations across several projects worldwide.
In the end, Wright said the devices can lead to improved collaboration between vendors and suppliers, delivering more connectivity on the construction site, especially regarding safety and claims.
“When you are easily sharing data real-time, it keeps everyone on an even keel,” he said.
Using these hardware devices, Gray can better monitor the trend of expected-versus-actual losses. It can gather data to use when talking to insurance carriers and brokers. And it also can get a better feel where its risk outliers are and have more information to validate correct assessments on claims costs.
“It works the other way, too. We have the data sophistication to measure and control risk and study risk, so we can prevent claims,” Wright said.
May 1, 2011
Copyright 2011© LRP Publications
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