The independent claims sector is facing a profitability problem. The 2022 Claims Salary Survey found that the median salary for independent adjusters plummeted from $163,000 in 2021 to $80,000 in 2022, with 41% of independent adjusters saying limited claim assignments had caused their income to decrease. IBIS World says U.S. claims adjusting revenue has grown over the past five years, but industry profit has decreased.
Something needs to change. By digitizing claims processes, IA firms can save time through automation and increased efficiency. Since time is money, this can translate into significant cost savings. Below are six critical reasons why your IA firm should embrace digital transformation.
1. Automate Parts of the Workflow
Complex claims still need human claims handlers, but this doesn’t mean you need to carry out every single action manually. When you introduce automation into your workflow, you reduce the overall workload, which creates more time for high-value tasks that need human attention. With automated claim assignments, acknowledgements, first contacts, and claim status alerts, workflows become faster and less tedious and fewer issues slip through the cracks.
2. Increase Efficiency
Automation isn’t the only way digitization can improve efficiency. For example, let’s say you need to search for something in your files. If you’re dealing with paper files, even a simple search could take a long time. Worse, it’s easy to miss the information you need and need to start over again. When you digitize files, searching becomes easy. Plus, mapping addresses, finding contacts, and carrying out other common actions are much more efficient in a digital system.
3. Scale and Accommodate Surges
Maybe you’re managing fine with old-fashioned methods right now, but those methods might not hold up if your volume of work increases. This can hold your firm back by preventing growth. In fact, you may be unable to handle surges. Imagine what would happen if a widespread disaster led to a sudden increase in demand for claims services. Digitization can help easily accommodate extra work to boost your income and show your clients that they can depend on you. If you can’t handle extra work when your clients need your help the most, your clients might start looking for other IA firms.
4. Standardize Processes
When everyone on your team uses a different method to complete the same tasks, your results may be inconsistent. The time required to handle tasks may vary. You may need to create workarounds when moving a file from one step to the next. These issues may not seem significant, but over time, lack of standardization can lead to errors, oversights and client dissatisfaction.
When you introduce a single digital system, you’re also implementing a standardized system, which is good for everyone.
5. Simplify Invoicing
Invoicing shouldn’t be a full-time job. Unfortunately, if you’re using an old-fashioned system that requires you to track and enter everything manually, invoicing can eat up a lot of time. A digitized system can simplify invoicing. Adding digital payment options can help you streamline even more.
6. Supervise File Handlers
It’s hard to know if your IA firm is running smoothly when you don’t have access to analytics. With a digitized system, you can access audits and reports whenever you need them. You can also manage permission and access levels, track licenses, and implement claim assignment rules.
How Could Claims Digitization Help Your IA Firm?
We’ve mentioned six improvements that are possible when you digitize your IA firm. However, it’s important to recognize that not all digital claims systems are the same.
VCA Software helps IA firms tackle challenges and increase profits through improved efficiency and automation. But don’t just take our word for it – see what one of our clients has to say. Also, be sure to use our ROI Calculator to better understand how VCA can help increase your profitability. And download our Buying Guide to see how VCA stacks up with other systems.