Effect of Claims Digitalization on Service Delivery by Insurance Companies in Kenya

Abstract

The claims’ function holds an important role in operations of insurance companies. Digitalization of claims processes improves service delivery and enhances operational efficiencies, enabling insurer to focus more of customer experience. The study sought to establish the effect of claims digitalization on service delivery of insurance companies in Kenya. The study adopted a descriptive survey design with population being all (56) insurance companies in Kenya. Data was collected using questionnaires on google forms platform and later exported to and subsequently analyzed in Excel and SPSS. The information was then interpreted using graphs, tables, and pie charts. A simple regression model was then used to assess the relationship between claims digitalization and service delivery. The predictor variables under claims digitalization were self-service tools, claims automation, digital integration with claims ecosystem, back-end claims management and audit controls. Regression analysis on research findings indicated a strong positive relationship between claims digitalization and service delivery, hence implying that digitalization of the claims function impacts on service delivery. Out of the variables under study, claims automation emerged the most influential aspect of claims digitalization with respect to service delivery, followed by audit controls and backend claims management. The least influential variables were integration with third party service providers and self-service tools. From the findings, it emerged that for many insurance companies, claims digitalization has been implemented, but not fully. The use of self-service tools was minimal, but claimants had varied options of intimating claims with majority being e-mails, calls or texts, and physical presentation of documents. Though not fully integrated, majority of insurers have a panel of third-service providers. Back-end processes of claims management are good, with most companies having incorporated audit controls to minimize leakages. On service delivery, it was apparent that not all companies have a CRM software or dedicated customer service team to handle customer complaints. Majority of companies offer value addition service to claimants to enhance their experience, conducted reviews to assess customer experience and trainings on customer service to enhance service delivery. The study recommends that digitalization of the claims process be enhanced, by use of self-service tools and end-to-end claims automation. On the claims eco-system, insurers can develop databases of third-party service providers and avail this information to their customers. To minimize leakages, insurers can enhance implementation of authorization limits and maker checker controls. Customer service systems or teams can also be implemented to handle customer complaints, and training and upskilling of staff be enhanced on claims management alongside customer service. In addition, acknowledgement of claims can be made promptly to claimants and at the same time feedback from customers can be sought periodically and recommendations implemented. Insurance companies can also gather information from their clients or from records to keep track of how loyal customers are. Further research can be done with a focus on service delivery from the customer’s perspective.