Modern Insurance Magazine Issue 38

Issue

38

ISSN 2515-3803

Connecting Insurers, Brokers, Lawyers & Claims Professionals

Bodyshops & Repairs Bridging the gap

Stewart Steel, Sedgwick Working with

Thinking ahead:

investing in relationships John Keeton and Scott Bissett, FMG

A look into the world of the car body and repair market

Upskilling

Steve Scofield, Institute of the Motor Industry (IMI)

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hat has been happening in the car repair sector?

Lots it would appear.

Bodyshops are a centric part of the motor claim. They are not only required to repair a vehicle, but provide a number of other services, such as identification of fault and non-fault claims, hiring of rental vehicles, plus much more.

It has become apparent that the number of bodyshops is on the decline, making it imperative for insurance companies and claims solution providers to adopt a strategy where they can truly work to support their supply chain and secure repair capacity in the forthcoming years. We are also faced with a skills shortage, so it is critical for insurers to work with their body repair partners as it is in everybody’s interest for bodyshops to attract and retain high calibre staff, ensuring that an insurer’s customer gets a safe repair.

(Left) Poppy Green, Editor, (Right) Rachael Pearson, Project Manager

In this edition, we sat down with three well-known figures to discuss the bodyshop and repair industry – Richard Billyeald, Thatchams; Robin Challand, Ageas, and Steve Plunkett, Volvo. We asked for their thoughts regarding the current challenges and opportunities facing the market. It became clear that ADAS repair will be one of the biggest tests for the industry, with much needed clarity being provided to the automotive, automotive repair and insurance industry on how best to manage vehicle repairs involving ADAS. Data will slowly become the new currency, and vehicle manufacturers might need to consider protecting and monetising that data.

You can read more about their views on page 13-16.

FMG’s Operations Director, John Keeton, and National Network Manager, Scott Bissett, told us how the company invests time, resource and expertise into the relationships with their network of repairers, and what benefits this presents for both the business and their customers. We also spoke to Stewart Steel, Sedgwick UK’s CEO, about Broker1, a specific broker-focused service, aiming to bridge the gap and provide claims management services alongside individual specialists within Sedgwick. This fit nicely with our round-up of BIBA 2019, which you can find on pages 52-55.

This edition is packed full of interviews and articles from some important figures across the industry, and of course, our expert panel of editorial board members, offering their insights into the car body and repair market as well as other issues affecting the wider industry. Accompanying this edition is a very special Modern Insurance Supplement – the result of a fantastic collaboration with handl Group, presenting their portfolio of businesses in the legal, insurance and healthcare sectors. handl Group is dedicated to providing services that make outsourcing simple. Whether it’s managing supply chains, providing claims management solutions or improving cost efficiencies, their brands deliver bespoke solutions that make a real difference. You can read interviews from their Chief Executive Officer, Graham Pulford, and Chris Chatterton, handl Group’s Chief Commercial Officer, plus a series of interviews from the Group’s brands – Coplus, Corporé, The Treatment Network, Speed Medical, EQL, MLA, Foresight and Harrison Associates.

I hope you enjoy this issue, and if you have any comments or feedback, then please do get in touch via the details below.

Poppy Green, Editor, Modern Insurance Magazine.

01765 600909 | @Modern_Poppy | poppy@charltongrant.co.uk Co-Editor Poppy Green Project Manager & Events Sales Rachael Pearson

Issue 38 ISSN 2515-3803

Modern Insurance Magazine is published by Charlton Grant Ltd ©2019 All material is copyrighted both written and illustrated. Reproduction in part or whole is strictly forbidden without the written permission of the publisher. All images and information is collated from extensive research and along with advertisements is published in good faith. Although the author and publisher have made every effort to ensure that the information in this publication was correct at press time, the author and publisher do not assume and hereby disclaim any liability to any party for any loss, damage, or disruption caused by errors or omissions, whether such errors or omissions result from negligence, accident, or any other cause.

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E D I T O R I A L

B O A R D

CONTENTS

27 Championing recycled parts

David Williams, Managing Director, Underwriting and Technical Services, AXA Insurance (UK)

27 How is technology changing the way we estimate claims?

Pablo Liñares, Director of Consulting and Innovation Services, GT Motive

29 Embracing technology for faster, fairer claims

Jason Tripp, Managing Director, Coplus

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Marc Lafferty, Chief Revenue Officer, EDAM Group

31 Emerging risks and the challenges to growth

Keith Tracey, Managing Director, Aon Risk Solutions

33 “Sprinklers – a traditional risk management solution for a modern world”

John Fearn, Head of Motor Claims, Broadspire by Crawford & Company

29 Improving customer service through better supply chain performance

04

31 Trust in your partnerships

Andy Miller, Loss Control Engineering Technical Manager, Allianz Insurance

33 How can telematics data help insurers to manage risk profiles?

Miles Keeble, Managing Director, MAK5 Limited.

Written on behalf of Nationwide Vehicle Assistance

E D I T O R I A L

B O A R D

CONTENTS

35 How can telematics help to combat fraud?

Donna Scully, Director, Carpenters Group

39 How is technology changing the way we estimate claims?

35 The journey towards autonomous vehicles

Calum McPhail, Head of Motor, Zurich UK

41 Embracing green parts

37 Changing perceptions

James MacBeth, Managing Director, Auto Windscreens

37 A united front

Trevor Lloyd-Jones, Senior Marketing Manager, Insurance, LexisNexis Risk Solutions

39 The key to claims fulfilment

Steve Thompson, Director, InduSTry Insights

Tom Helm, Head of Claims Consulting, Insurance Consulting and Technology, Willis Towers Watson

Nik Ellis, Managing Director, Laird Assessors

41 Will there be real trust?

Stephen Marshall ACII, Managing Director, Insure Apps

43 How is technology changing the way we estimate claims?

Marco Amendolagine, Director of Product: Crash and Claims, Octo Telematics

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CONTENTS 9

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INTERVIEWS

NEWS

9 Upskilling to

13 In conversation

provide the insurance sector with a robust infrastructure

with...

As vehicle technology advances, so do the opportunities and challenges for those working in the business of vehicle repair – from windscreens and tyres to body and paintwork. Steve Scofield, Head of Business Development, Institute of the Motor Industry (IMI), discusses how the sector needs to develop as it faces a fast changing future, and how these developments will impact the insurance sector which provides motorists with allimportant personal and financial protection.

NEW LOOK

The industry’s associations outline the issues currently facing the claims sector.

Pages 45-47

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investing in relationships

Modern Insurance spoke to Operations Director, John Keeton, and National Network Manager, Scott Bissett, at FMG about how the company invests time, resource and expertise into their relationships with their network of repairers and what benefits this presents for both the business and their customers.

Sedgwick is a leading global provider of technology-enabled risk, benefits and integrated business solutions.

Modern Insurance spoke to Stewart Steel, CEO, about Broker1, a specific broker-focused service, aiming to bridge the gap and provide claims management services alongside individual specialists within Sedgwick.

CONTRIBUTORS

INSURANCE

F E AT U R E S 27 Editorial Board

Find out what our editorial board panel of experts have to say in this edition of Modern Insurance Magazine.

45 Sector Soapbox

18 Thinking ahead:

Soapbox

BOARD

In this edition of Modern Insurance Magazine, we sat down with three well-known figures to discuss the bodyshop and repair industry. We asked for their thoughts regarding current challenges and opportunities as well as technological advancements and more.

22 Bridging the gap

Sector

EDITORIAL

48

Modern Insurance’s panel of resident associations outline the burning issues facing the claims sector.

48 Industry Innovators Interview: Claim Technology

Transforming insurance claims by making it easier and faster for customers to make an insurance claim using an intelligent chatbot, web or mobile apps; Michael Lewis, CEO at Claim Technology is changing the game. Over a year since the introduction of Claim Technology, we hear about their future plans and how they are turning the claims process upside down.

CONTENTS 56

63

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10 MINS WITH 52 BIBA 2019

Widely acknowledged as the leading insurance intermediary conference and exhibition, the British Insurance Brokers’ Association’s annual event yet again produced a unique networking opportunity for all those involved in the industry.

With an eclectic mix of speakers and seminar sessions, and of course the Hackathon, this year’s BIBA conference was not one to miss. Modern Insurance captured the occasion in a snapshot of interviews below.

60 Discussing datadriven claims solutions and mobility claims in the motor repair and insurance sectors

56 HGV estimating managing client expectations You could be forgiven for thinking that HGV accident repairs is clouded in mystery and is something of a dark art.

Innovation in Information However, to fully understand the complexities of HGV estimating Get the essential and repairs and to manage client insights you need to expectations regarding loss of more accurately price and underwrite risk use, it’s important for insurers to from LexisNexis Risk appreciate that the processes are Solutions. quite different from those of cars and vans. Neville Lidford, Director of Engineering and Operations at Selsia gives his thoughts.

Insurers are challenged to consistently offer a faster, frictionless experience for their claims customers with limited IT budgets and legacy systems.

Although there have been breakthroughs in streamlining the life of a claim, there’s still room for progress. Olly Savage, Business Development Director at Verisk Claims, explains how insurers can introduce data led solutions to achieve truly end-to-end, ‘right touch’ claims.

63 Women in repair

66 10 minutes with…

Paul Sykes, Control Expert UK Ltd.

Bridging the gap Page 22 MIM spoke to Stewart Steel, CEO at Sedgwick UK, discussing Broker1, a specific broker-focused service, aiming to bridge the gap.

Introducing our ‘Women in repair’ feature is Julie Eley CMIOSH MIMI, Operations Director for Quantum Technical, who discusses the importance of getting more women involved in the sector but also celebrating the fantastic women that are currently a part of the industry and why they are such an inspiration! #girlpower

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right people. right skills. right technology.

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END-TO-END COMPLETE CLAIMS & LEGAL SOLUTION

NEWS

Upskilling to provide the insurance sector with a robust

infrastructure As vehicle technology advances, so do the opportunities and challenges for those working in the business of vehicle repair – from windscreens and tyres to body and paintwork.

Steve Scofield, Head of Business Development, Institute of the Motor Industry (IMI), discusses how the sector needs to develop as it faces a fast changing future, and how these developments will impact the insurance sector which provides motorists with all-important personal and financial protection. t is the IMI’s job as the automotive retail industry professional body to make sure that anyone working in the bodyshop and repair sector stays abreast of the skill sets required as developments in automotive and motoring technology evolve. It’s only by creating and implementing consistent industry repair standards that take account of modern technology that we can reassure both motorists - and the insurers underwriting those drivers - that their vehicles are being repaired to manufacturer standards. And that goes to the heart of the sustainability of the sector.

Motorists want cars that are safe and reliable for them and their families and which retain a value for the future.

I

The challenge right now is to help the sectors that underpin the UK’s motoring infrastructure to upskill and stay on top of evolving technologies

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The challenge right now is to help the sectors that underpin the UK’s motoring infrastructure – the garages, bodyshops, windscreen replacement and tyre companies, and even roadside assistance providers – to upskill and stay on top of evolving technologies.

We may not have reached the reality of autonomous cars on UK roads yet, however, whilst cars today aren’t driving themselves to the bodyshop for a new panel, technological advancements are progressing at a pace. And insurers and motorists need reassurance that the bodyshop or repairer they book their vehicle into after a collision has the right skills, not only to mend it appropriately, but to ensure that all other connected systems will continue to work effectively.

The big question has to be, ‘…is the bodyshop or repairer properly skilled and equipped to work on the latest Advanced Driver Assistance (ADAS) and electrified vehicles?’ After all, we’re not talking about some futuristic concept car.

A massive 10% of vehicles on the road today that’s nearly four million cars – are already fitted with Autonomous Emergency Braking (AEB). In order for that technology to remain wholly effective, it must be repaired to manufacturer tolerances.

Another common motoring technology, Adaptive Cruise Control, has the same issue.

As an industry body, we welcomed the core principles recently announced by Thatcham Research to provide clarity on how to manage vehicle repairs involving ADAS. We have been championing the setting of standards ourselves to ensure technicians are appropriately qualified to work on ADAS and electrified vehicles, through our IMI TechSafe banner. Technicians can work towards an IMI ADAS Accreditation, helping to establish a recognised mark of quality which can provide the driver – and their insurer - with the peace of mind that after a repair, the ADAS technology remains totally effective.

But even with the industry standards set, it is up to us and the motor industry as a whole – from the largest manufacturer to the smallest bodyshop – to invest in the continuous training required to keep pace with the rapidly evolving technology. Only then can we guarantee the safety standards we enjoy today, into the future.

Recruiting for electric dreams Quite rightly, global warming is the issue of the moment. As consumer desire to do more for the planet increases, so does the demand for Electric Vehicles (EVs). Worryingly though, we are already facing a significant skills shortage in the accident repair sector which doesn’t look like it will go away any time soon. The combination of an existing skill shortage and demand for EVs means the requirement for all employers and individuals to upskill and invest in Electric and Hybrid vehicle training is urgent.

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The more informed repair networks have already achieved 20,000 qualified individuals, but the wider industry needs to step up to the plate and get trained now. This is applicable not only for the repairers, but also the Vehicle Damage Assessors. After all, it is the assessors who close the loop on the repair and provide the independent feedback to reassure the insurer that it has been carried out professionally.

It’s not just about continuous professional development though. ADAS and EV repairer training needs to be embedded in the training curriculum right from apprenticeship level. In doing so, the motor industry is demonstrating responsibility to young people who choose to enter the bodyshop and repair business as their chosen career. By equipping new entrants with the necessary advanced qualifications towards a professional and successful future, bodyshop and repair business leaders are also helping guarantee the bright future of their own industry.

Scanning the horizon New technology is just one factor that the automotive repair sector needs to keep abreast of. The automotive ownership model is already shifting to mobility on request, which is a whole new world for the sector to adapt to. As retail customer environments dwindle and leasing mobility becomes the norm, the consumer is no longer likely to have control on the choice of repair or bodyshop – this will fall to the mobility provider and their insurer. What’s more, as regulation shifts in an attempt to drive the green agenda and stay relevant to rapid technology advancements, bodyshops will need to up their efforts to stay in the game as well as find competitive advantage.

Change is clearly the status quo now – and likely to be for some time in the future for the automotive sector and all the services that underpin it, from the insurers to the repairers and beyond. As Henry Ford is famously quoted, “…anyone who keeps learning stays young…”, and that adage certainly applies to the motor and insurance industries. The landscape is constantly changing and we need to change with it. That’s why the IMI supports the sectors in attracting, growing and retaining staff via qualifications, setting industry standards on professionalism and helping develop career opportunities.

Steve Scofield is the Head of Business Development at the Institute of the Motor Industry (IMI).

To find out more about the IMI’s initiatives to support the automotive repair sector visit: https://www.theimi.org.uk/imi-bodyshop-solutions

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INTERVIEWS

INTERVIEWS

In conversation with In this edition of Modern Insurance Magazine, we sat down with three well-known figures to discuss the bodyshop and repair industry. We asked for their thoughts regarding current challenges and opportunities as well as technological advancements and more.

Richard Billyeald,

Robin Challand,

Thatchams

Ageas

Steve Plunkett, Volvo MODERN

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INTERVIEWS

Let’s get consumers more invested in the bodyshop and repair industry too.

Better clarity and communication is only going to benefit everyone Richard Billyeald, Thatchams

Q

Q

bodyshop that has many work provider approvals is that they are trying to be the master of all things. I think the time will come where the bodyshops will specify in certain VM brand approvals as the technology overtakes a generic skill set in the work place.

skilled trades within the profession, from panel beaters to paint sprayers, we help develop repair expertise which can avoid costly solutions of replacing parts. This is particularly important for vehicles involved in low impact collisions. Repairs will often be time and cost effective, be better for the structural integrity of the vehicle and help customers keep their vehicles on the road.

What would you identify as the main challenges for the body repair industry?

Steve Plunkett: One of the main challenges for a

Richard Billyeald: ADAS repair is one of the biggest challenges in this industry. We have been providing much needed clarity to the automotive, automotive repair and insurance industries on how to manage vehicle repairs involving ADAS, such as Autonomous Emergency Braking (AEB) and Adaptive Cruise Control.

Our guidance on the safe repair of ADAS sets out a number of measures under which insurers and repairers can prove that they have taken all necessary steps to reinstate the safety functions of a vehicle before returning it to the road; including that post-repair calibration to ‘vehicle manufacturer tolerances’ is essential.

Data is going to be an interesting area too. Data is the new currency and vehicle manufacturers might want to consider protecting and monetising that data. It could have a knock-on effect for repairers, but it could also provide an improvement or uplift if the car’s data could be used to assess damage.

Q

One of the biggest threats to the body repair industry is the skills crisis, what do we need to put in place in order to overcome this?

SP:

We need every bodyshop and associated business to invest in young people and in more than one young person at that, and now, in 2019. We need them out in the schools and colleges speaking to students and potential candidates, young people don’t see enough of our sector. We need action.

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How can we repair vehicles more effectively?

Robin Challand: By repairing vehicles and supporting

Where the vehicle assessment indicates that replacement parts are needed, Ageas is encouraging repairers to consider using refurbished green parts. These parts are quality parts that are quality controlled by a specialist supplier. They have a guarantee and are checked by the repairer before they are used. Their use reduces the likelihood of cars being scrapped for economic reasons and also reduces our impact on the environment.

Recognising the extensive personal expertise of bodyshop professionals, Ageas’s ethos is to trust our repair network to repair a vehicle in the appropriate and most efficient way. This frequently means that repairers will use readily available, non OEM (original equipment manufacturer) parts. When these parts are sourced from the right provider they will be of the same quality and have similar levels of guarantees providing piece of mind to the vehicle owner.

SP:

By utilising the VM approved bodyshop networks that have the latest technology in the workshops, supported by a skill set of brand trained technicians, using recommended VM factory researched and recommended repair methods. This is where the expertise is at, bodyshops have invested many thousands of pounds in terms of ensuring that they are fit for purpose, to enable them to be ahead and the best at repairing individual brands.

INTERVIEWS

I would like to see improved engagement within the sector between VM’s and work providers, there is too much scare mongering around

Q

Is the relationship between insurers, bodyshops and OEMs improving?

RC: Our relationship with body-shops and OEMs is improving because we have built sustainable relationships with the repairers we have a contractual relationship with. Key to this is the trust we have in each approved repairer to undertake the right repair for each individual job.

The AI tool that we use to assess each vehicle (Tractable) gives us the opportunity to quickly assess the parts each vehicle requires to get back on the road. We look for approved repairers to embrace technology and understand the benefit it brings to our customers.

Technology including AI allows us to rapidly assess the parts required, without the intervention of an engineer, customers’ vehicles can be repaired rapidly and returned to them.

Of course there are always complicated repairs that require inspection from an engineer. If this process is protracted it can cause significant delays for repairers, with valuable storage space taken up by vehicles while negotiations take place. Our expert engineers now only get involved in these non-standard cases, so we can operate effectively with repairers and provide the best service to our customers, reducing delays.

Operating with complete transparency between insurers and bodyshops also allows us to understand the broader trading pressures that each faces. For example, I know that repairers operate in an environment of parts shortages, increased parts prices, labour shortages and higher property costs. Our repair network understands that insurers need to provide a valuable proposition that customers will buy. This mutual respect supports our sustainable relationships.

Steve Plunkett, Volvo

Q

How is the customer’s relationship with their vehicle likely to change; do we need to be on the lookout for alternative mobility solutions?

RB:

Absolutely. The customer’s relationship with their vehicle is definitely going to change and is changing already. We are moving away from car ownership. The next generation view the car as much more of a service now – it is all about from point A to point B.

However, there are bigger implications. From an automated driving point of view, if a car can drive in certain scenarios, then you are essentially becoming the passenger in that car – it is another step away from the combined man and machine as it were. It is very exciting but there is a way to go first.

Q

How is the next generation of vehicle complexity starting to effect both rating and repair points of view?

RB:

Vehicle technology is increasing and developing exponentially at the moment. Changes to vehicle technology has been greater in the last five years than it has been in the last fifty. There are big challenges surrounding the new technologies and we are trying to provide clarity to our members, insurers and to the repair industry as to what these technologies are, what they mean and what the impact is that they are going to have from a repair point of view but also from a rating point of view.

We have found that manufactures are not as supportive of the new technologies – the guidance on how to deal with this new technology just isn’t there yet.

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INTERVIEWS

Q

Q

We have seen a huge improvement in vehicle safety in the last twenty-five years. We have primarily been looking at passive safety, but active safety is where we are at the moment. If you can avoid that crash in the first place then that is even better. The technologies that we are seeing around sensors, radars and cameras is enabling active safety and the collision avoidance.

I would like to see improved engagement within the sector between VM’s and work providers, there is too much scare mongering around, for instance the costs of repairing ADAS technology! Without enough acknowledgement of the benefit that it brings to human lives. This life changing technology is saving lives and reducing injuries, let’s celebrate that instead of looking at increased costs of repairs, surely this has to be good news for everyone. Let’s also concentrate on repairing these vehicles safely in the aftermarket to ensure that the systems function as designed in the event of another accident or maybe more to the point, that they stop the accident or reduce the impact in the first place.

How is the industry redefining vehicle safety and how is it using technology to do so?

RB:

Q

How has the role of the bodyshop within the claims process changed in recent years?

RC:

For customers making a claim repairers can be the face of their motor insurers. They deal directly with customers so the quality of their customer services directly affects a customer’s view of their insurer.

Customers rightly expect the customer experience they receive from retailers to be replicated and this includes Insurers and repairers. First and foremost it is key that we do what we say when we are going to do it, the use of Digital updates and tracking allow customers to see that repairs are on track.

AI systems are changing decision making but it’s only the beginning.

A significant amount of valuable data is being gathered by these and other systems used by repairers. Insurance underwriters could use this data to better understand the trends in car accidents and repair costs; this is particularly important with the rapid introduction of allelectric vehicles and the roll-out of premium driver assist technology to all vehicles.

What would you like to see change in the industry?

SP:

RB:

Number one thing that I would like to see is the manufacturers’ technologies supporting the repair industry in a much better way. I would like to see repairers taking these opportunities and realising that the world is changing and that there is support out there, alongside great ideas and innovation. I would love to see them taking advantage of those.

Let’s get consumers more invested in the bodyshop and repair industry too. Better clarity and communication is only going to benefit everyone.

Richard Billyeald is the Chief Technical Officer at Thatcham Research;

Robin Challand is the Claims Director at Ageas UK; and

Steve Plunkett is the Body & Paint Developing Manager at Volvo.

Bodyshops are not just a repairer at the end of a chain – they are integral to the success of our business.

Q

What do you expect the future to look like for bodyshops and the repair industry?

RB:

A lot of what Thatcham is planning to do is get the vehicle manufacturers back in providing support to repair and bodyshops.

With the changing nature of vehicle ownership and the mobility of the service – it is going to change. How vehicles crash will change and therefore the nature of the damage will change, so it is not just repairing those technologies but those technologies changing what you expect from a damaged vehicle and therefore how you repair it.

The consumer expects more information now than ever. There are opportunities for the repair industry to take a step forward and move the perception rightly or wrongly away from the spit and sawdust to the modern, clean, communicative and open approach that could really make a difference to consumers; it could be the next business model for repairers.

Bodyshops are not just a repairer at the end of a chain – they are integral to the success of our business Robin Challand, Ageas 16

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INTERVIEWS

Thinking ahead: relationships investing in

Modern Insurance spoke to Operations Director, John Keeton, and National Network Manager, Scott Bissett, at FMG about how the company invests time, resource and expertise into the relationships with their network of repairers, and what benefits this presents for both the business and their customers.

We work together to provide all the support our network needs to ensure they repair our customers’ diverse vehicle profile to a high standard

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Q

Tell us a bit about yourselves and your roles at FMG...

John Keeton: I joined

FMG in 2006 as a Customer Service Representative in FMG’s 24/7/365 service centre, handling incoming calls from drivers reporting first notification of loss (FNOL). From the very start I was impressed with FMG’s professional and friendly culture and the way all customers, suppliers and colleagues are highly valued within the business.

I decided to carve my career within FMG and steadily progressed through a number of roles before joining the Board in 2017.

FMG manages motor incidents and claims on behalf of large UK insurers, blue chip companies and leasing providers. When vehicle incidents occur, we provide a whole range of services including FNOL, repair management, loss recovery and third party services.

We rely upon our network partners and supply chain to deliver a fundamental part of our service and the main customer touchpoint; the repair of our customers’ vehicles, hence our commitment to investing and nurturing our network relationships.

Scott Bissett:

I spent ten years working in a bodyshop, progressing from shop floor to estimating then to management, prior to joining FMG as an Engineer in 2003. As National Network Manager, I now oversee FMG’s team of six Network Managers. Essentially we work together to provide all the support our network needs to ensure they repair our customers’ diverse vehicle profile to a high standard.

Q

How does FMG invest in their network of repairers?

SB:

Our Network Managers are a team of experienced industry specialists each with their own extensive knowledge of vehicle

INTERVIEWS repair. Each Network Manager has their own geographical area to oversee and they take responsibility for providing ongoing support to the repairers within their region. Having our own team of experts in this field sets FMG apart in our industry. Our network is considerable in size, it covers the whole of the UK and consists of 228 car and LCV repairers, 48 commercial vehicle repairers, 250 mobile and SMART repair technicians and we work in partnership with 32 Xpress Centre sites.

The Network team are a constant point of contact for the network. They provide day-to-day advice, business improvement recommendations and performance management. To maintain the standards in place on our network, we have a rigorous audit process which determines how well our repairers meet FMG’s demanding criteria. They can view their own performance management statistics on our repairer portal. A ‘balanced scorecard’ compares key performance indicators (KPI’s) with actual performance so repairers can easily see for themselves how well they are meeting performance targets and satisfying our customer’s expectations.

Our Network Managers also monitor capacity and capability, making sure that we have enough repairers to fulfil work volumes, they have the capability to repair today’s modern vehicles and identifying areas which need support and development.

JK: Our repairers tell us that they value the way we

manage and invest in the network. Scott and his team work collaboratively with our repairers to make sure that all parties benefit from its existence. Ultimately, we aim to deliver the best possible solutions for our customers, yet we take time to ensure that our repairers’ strategic business plans are aligned with ours so as to achieve maximum value from the successful management of the network.

Q

You mentioned that repairers are able to set and view their KPIs through your online repairer portal, can you tell us more about this?

SB:

Our repairers have constant visibility of their performance against KPI’s through our bespoke online repairer portal. The

portal supports our commitment to working transparently and efficiently. Each repairer can see all the claims information they need to manage their FMG repairs, with a bespoke dashboard and granular performance management information. Feedback from repairers is very positive; they tell us the portal is useful and really drives their performance.

Q

How have direct communication links to repairers improved operational efficiencies?

JK:

Significantly. We have maximised efficiency in communication by establishing direct links to repairers through integration technology, AudaInvoice and bodyshops’ own communication systems. This has reduced manual touchpoints and lengthy transactional processes to enable our repairers to be more operationally efficient.

We introduced automation and connectivity systems seven years ago and we invested in linking our in-house Ingenium system to bodyshop management systems. We have evolved, innovated and invested heavily and we connect to the vast majority of our bodyshops (over 85%) for repair updates right from the initial notification of the job. At any point throughout the repair process, bodyshops can easily relay information from their own bodyshop management system to FMG at the push of a button. Previously, this would have entailed a number of telephone calls from FMG’s repairer management team to each repairer to ask for progress updates.

Automation of this kind significantly improves efficiency. It allows us to deploy our staff to the tasks that really add value to the customer and avoids duplicating effort.

We also carefully manage triage. During FNOL we ask carefullytailored questions to capture very specific information. This helps us to allocate the vehicle to the best repairer for the vehicle type and repair required.

Scott and the Network team take time to understand our customers’ requirements and then communicate those to our repairers to help them thoroughly understand what our customers are looking for.

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INTERVIEWS

SB: We have many different customers,

all with different requirements, and what might be important to one customer is not necessarily important to others. We are committed to delighting them all.

Q

The industry is one of the most receptive to emerging technologies.

What new, emerging technologies can we expect in the repair sector?

SB: We have seen many changes to

vehicles in recent years, from the use of composite body materials, to ADAS safety systems and vehicles communicating with our technology, with the emergence of vehicles talking to one another on the horizon. We continually engage with our repairers on industry trends and challenges to make sure FMG and our network are early adopters to new and emerging technology.

It is essential that we thoroughly understand how these changes affect repairers in terms of new repair processes, costs and repair skills required.

JK: Our customers look to us for the

insight in what is a rapidly evolving industry and market, and what that means for them.

Scott recently led a research exercise to compare 2017/2018 vehicle models to the same type of damage five years ago. This clearly highlighted the complexity of modern vehicles, the changes to the repair process and the entire repairer landscape.

Q

How will the growth of autonomous technologies redefine the driving experience and the repair process?

JK:

The growth of autonomous Advanced Driver Assistance Systems has already added complexity to the repair process and we are working in partnership with some of

We have many different customers, all with different requirements, and what might be important to one customer is not necessarily important to others

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our customers to see how operations may change further in the future, for example with the introduction of crash detection and emergency calling among other technologies. We will continue to keep an eye on the industry and emerging trends, to ensure we are proactive and prepared for the opportunities and challenges we face.

Q

How are skill sets changing?

JK:

Our engineers need to be at the forefront of changing repair methods, and making sure that that they are aligned with manufacturers. Over the past 12 months all of our engineers have attended courses with manufacturers to ensure we are up to speed when repairing their vehicles. We are constantly harnessing and leveraging relationships to ensure we maintain the skills and expertise required to deliver to the highest standards.

JK:

Last year we relocated to our new, larger head office in Huddersfield, which has given us the extra space we needed and a platform to conduct our next stage of growth. During the past four years we have expanded into the insurance space, working with some big mutual insurers and brokers, expanding our portfolio of claims management services. We have also taken our bespoke solutions into the vehicle manufacturer space. Looking ahead, we will continue to invest in these core markets, enhancing our proposition, focusing on innovation and technology, and looking at new ways to work with our partners to meet our customers’ changing needs.

Q

We know that bodyshops are unfortunately on the decline, how can we reverse that transition and get more young people involved in the industry?

JK:

The repair partners within our network are large, professional, multi-site organisations yet there is no doubt that there has been a skills gap developing over the past couple of years. One of our larger repair partners held an apprenticeship open day recently and over a hundred people attended. It is important that we demonstrate the opportunities and career paths available within the profession, and continue to look at new ways of attracting and retaining talent into what is fast becoming an exciting and diverse industry.

Q

What does the future hold for FMG?

John Keeton is the Operations Director at FMG.

Scott Bissett is the National Network Manager at FMG.

Operating in partnership with insurers, MGAs, brokers, direct customers and leasing providers, FMG is the UK’s leading, high quality provider of claims management solutions.

Our People

Our Services

We invest in the expertise and excellence of our people to ensure they have the ability to manage any case, no matter how complex, to the highest standards.

We offer a full suite of services, including: - FNOL - TP Intervention - Repair Management - Engineering - Mobility Solutions - Loss Recovery

Our Network Proud to partner with a UK-wide repair network of over 275 suppliers.

Dedicated to working hand-in-hand to deliver the best solutions for our customers.

Our Solutions Each of our claims solutions can be fully tailored to meet your specific needs. Use them individually or combine them for a full end-to-end solution.

Contact us for more information by emailing us at info@fmg.co.uk or call us on 0344 243 8888

INTERVIEWS

Bridging the gap Sedgwick is a leading global provider of technology-enabled risk, benefits and integrated business solutions.

Modern Insurance spoke to Stewart Steel, CEO, about Broker1, a specific broker-focused service, aiming to bridge the gap and provide claims management services alongside individual specialists within Sedgwick.

Q

Sedgwick’s Broker1 is all about bridging the gap. Why do you think there is a gap?

A

In terms of global brokers and global corporate programs, and more often than not the policyholder, brokers and insurers will pre-nominate loss adjusters, lawyers and other experts to work on their programs, such appointments providing a degree of pre-loss as well as post-loss input. This is a concept which has worked phenomenally well for decades in the Fortune 500 arena. The founding concept of Broker1 was to assist brokers operating in the mid-market and SME space to exercise the power they have to take a greater position in the claims process; influence a claim outcome and enhance the overall customer experience and journey for their valuable clients.

Broker1 is about giving the broker an opportunity to be front and centre of the whole process; it is not just about selling a policy, it is about brokers working with – and adding value for - their clients throughout the entire insurance procurement, administration and claims journey. Broker1 gives brokers more confidence when talking to their customers about the claims process, typically introducing the adjuster long before there ever is a claim. This enables the adjuster to learn about the business in more detail, so that if and when something does go wrong and a loss occurs, the adjuster is already tuned into the risk - how the site is set out; who the key customers and suppliers are; where the critical manufacturing/ distribution pinch points might be, etc., and – essentially – is cognisant of the Business Continuity Planning procedures in place.

At the same time, the policyholder has the opportunity to meet and engage with the adjuster in a non-traumatic environment and build an early rapport with the individual who they will likely need to trust and rely upon when the claim happens. Though being the conduit for this activity, the broker cements their position as being both central and critical to the entire process.

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Broker1 is about giving the broker an opportunity to be front and centre of the whole process

INTERVIEWS

Some insurers have already mastered the ability to process claims without any human touch at all. We will see more of this and can expect the industry to handle claims of ever increasing size and complexity using AI solutions

Q

Technology is showing no sign of slowing down, which will inevitably have an effect on customer needs. How do brokers need to adapt in order to deal with changing customer needs and how can Broker1 help to facilitate this?

A

Broker1 creates a powerful four-way working relationship customer, broker, insurer and adjuster. Technology plays a role in supporting this team dynamic and the technical and customer service expertise needed to conclude a claim successfully.

This might be through the use of self-serve applications to facilitate new loss reporting and settlement of smaller losses without human intervention – typical AI solutions – or the use of video and drone technology to reduce cycle time through expediting the investigation process. Most talk about artificial intelligence, robotic processing and machine learning at the moment, tends to be confined to the personal lines space - where there is a high volume of small claims and a ready 24/7 connectivity to internet technology but there is no reason why those same processes can’t apply to processing smaller claims in the commercial arena too and work is well advanced in this area. A service that enables an insured to self-serve their way through the resolution of smaller claims and interact more easily and timely with their broker, insurer and adjuster on others, will reduce processing costs and be seen as a much more customer friendly service by the client. Broker1 has both the technology and the technical expertise to support brokers in this arena.

Q

How else is technology changing the whole insurance industry? What are Sedgwick doing to innovate and streamline themselves more through technology?

A

Some insurers have already mastered the ability to process claims without any human touch at all. We will see more of this and can expect the industry to handle claims of ever increasing size and complexity using AI solutions. As a consequence – and we are already starting to see evidence of this - those insurers leading the charge will likely see labour and process cost benefits that could lead to the potential, to offer more attractive premium rates, provided they can control indemnity spend. Those insurers who do not, cannot or will not invest in the cost of the technology needed to keep up may find themselves either exiting the space or partnering with suppliers capable of taking over their claims service on their behalf. Over time, it will be interesting to observe whether it proves more beneficial for insurers to build and continue to develop their own digital solutions in-house or whether an outsourcing solution proves to bring the best return on capital employed.

Sedgwick is the largest loss adjusting and insurance claims management business in the world by some margin, with a stellar reputation for managing c. four million claims per year across the globe. Supported by enviably deep financial, technical, managerial and technological resources, we are developing ever greater end to end claims handling solutions to capitalise on the rapid changes in the insurance market brought about by the advent of technology, enabling us to support insurer, broker and policyholder clients to face their own challenges in this space.

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INTERVIEWS

Q

It has been nearly a year since the acquisition of Cunningham Lindsey and its subsidiaries, how has Sedgwick’s position in the market been reinforced and what improvements have you seen through the combined organisation of these companies?

A

We have had some wonderful feedback in relation to the integration. Indeed, completely unsolicited, a client told me that the view of the market was that if you wanted to put two companies together, the model way to do it was how Sedgwick put Vericlaim and Cunningham Lindsey under the Sedgwick banner.

A competitor very recently enquired of one of my colleagues as to when we were going to start the implementation process, as he anticipated (hoped?) that would be the time we’d hit problems.

He was somewhat upset to find out we’d already completed the exercise.

and develop our people and about being flexible and creative when responding to the needs of our colleagues today and into the future.

Similarly, we aim to be Supplier of Choice. We already have a very strong, attentive and empathetic client relationship management team, which we believe is second to none. Our Caring Counts mantra links both of these aspirations – if we look after our colleagues, our colleagues will look after our clients and the clients will ultimately look after us.

Finally, 2019 sees a massive focus on technology. This supports our digital journey and the wider promises and commitments we have made to our clients and colleagues alike.

Bringing three separate businesses together was obviously not without its challenges, not least as the UK Executive Team – encouraged by our clients - took the view we should also reshape the operating structure of the business at the same time to bring greater clarity, focus and investment to our key products – Commercial & Specialty, Home and TPA. As with everything, it’s one thing to have a vision but quite another to realise and deliver it.

This can only be achieved by having highly committed and talented people in the business and giving them the authority to get on with it. At Sedgwick, we are fortunate to be blessed with many such colleagues and as a result look forward immensely to working with the market as we face the challenges ahead.

Q A

How do you expect the industry to evolve and adapt as more changes take place and regulation and legislation evolves?

I think there will be more consolidation across the entire insurance industry as the twin impacts of regulation and digitalisation take real effect. Ten years ago, we set up Vericlaim in the UK and whilst we did face regulatory challenges at that time, I really do not believe it would be possible to replicate what we did then today.

It was put to me by an insurer recently that ten years ago they would buy services on technical ability alone, but now they would place governance above technical ability. This gives smaller suppliers – whatever their service offering - a real challenge and could lead to a reduction in choice in the near term to a small number of very large players offering a wide breadth of services, But the flip side to that is that the market overall will be much more secure, better controlled and safer to use for consumers and commercial buyers alike.

Q

What does 2019 hold for Sedgwick?

A

Three things. We talk about clients, colleagues and technology. 2018 was our integration year and having settled that down, we are now ramping up our aspiration to be Employer of Choice. For us, this is all about how we select, recruit

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Stewart Steel is the Chief Executive Officer of Sedgwick UK.

2019 sees a massive focus on technology

Broker1 Making claims easy for everyone

Giving you the range and depth of expertise you need, with the local one-to-one support you want.

Broker1 is our specific broker-focused service. It provides you with a local point of contact for technical and administrative claims issues and delivers the extensive support you and your clients need – before, during and after any type of loss.

21,000

900

65

3.8m

65+

1

colleagues

offices

countries

claims managed

languages spoken

point of contact

Steve Gargano

Business Development Director steve.gargano@uk.sedgwick.com

sedgwick.com/uk

Ian McLennan

twitter.com/sedgwick

Business Development Director ian.mclennan@uk.sedgwick.com

linkedin.com/company/sedgwick © 2019 Sedgwick International UK/05–19/J03875

EDITORIAL

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Championing recycled parts have green initiatives been embraced by How the repair and/or insurance industry?

insurers suggest labour only deals with them supplying the parts, maybe it’s the general parts mark-up earning opportunity that is the real element they are trying to protect?

I think that there have been a lot of positive comments on green initiatives, but frankly poor implementation and communication by insurers in part, and self-interest from all sides leading to scare mongering about some genuinely good intentions. When people protest so loudly, I ask myself where potentially the vested interests are, and sadly, I think there are strong financial drivers when discussing this contentious area.

My view is, if non safety-critical parts can be replaced with tested recycled units that are the same age or younger than the recipient vehicle, then it should be supported. It is genuinely good for the environment and benefits can be passed on. Do we do it though?

Generally NO as the scaremongers have done such a good job.

We don’t want the negative PR and therefore reserve it only for exceptional circumstances agreed with full transparency to the customer, when we have difficulty getting a new OEM part.

Interestingly, however, with Brexit looming and universal predictions of parts delays, this is definitely something that needs to be revisited.

Manufacturers don’t help, fewer and fewer small parts are available, moving more to whole units that cannot be repaired and need full replacement (headlamps being an obvious example).

Turning to insurers’ failings, an obvious problem has been in not communicating convincingly the benefits of the most contentious opportunity – Recycled Parts. I accept the criticism that describing them as ‘Green’ was seen as trying to disguise things that are essentially ‘Second-Hand’, but is ‘Second Hand’ that bad? For most of my life I’ve been very happy buying second-hand cars, as have the majority of the population, so why on earth not second-hand parts? I think what was missing perhaps was a bit more honesty, clarity that these parts were being reused. Also, in using them making sure not just the insurer benefitted, the willing recipient getting benefits, maybe in reduced premiums, or maybe simpler, a reduced excess reflecting any savings. On the subject of honesty, that is needed from the repairer ‘Champions’ as well.

Safety concerns? Perhaps, or based on the ‘outcry’ whenever

Maybe the solution is to go for a dedicated discounted insurance product where everyone knows up front that ‘second hand’, ‘Green’ parts will be used? That’s been tried before but sadly vanished without trace, I’m still not sure whether that was scaremongering winning the day or just premium discounts weren’t big enough.

Maybe with a song at the top of the charts celebrating saving our Earth, public opinion may have changed sufficiently to give it another go? With better more honest communication on both sides, and benefits shared, why not? Let’s hope this time we can make it work!

DAVID WILLIAMS,

Managing Director of Underwriting and Technical Services, AXA Insurance (UK).

How is technology changing the way we estimate claims?

Technology is evolving at an incredible pace, changing many aspects of our lives. The way we estimate claims is no exception and is being impacted from different angles by technology. This process traditionally required an extensive knowledge of the different insured goods in different insurance branches. Technology has been helping loss adjusters in this regard, for example, with tools in the form of estimating software, which help in the process of identifying the cost of replacing or repairing insured goods. In the case of motor claims, estimating software has been an essential tool for many years, used by loss adjusters and repairers. We can already see technology might be changing this paradigm.

There is one particular trend in technology which has been evolving greatly in the last few years and which we believe will have a great impact: Artificial intelligence (AI). In a very simple way, AI is all about computers doing human-like tasks like understanding the context of a text, recognising a face or an object in a picture or identifying the mood of a person on a telephone conversation. Thanks to the amount of information available to train computers and the affordability of computing power available, AI is more capable than ever and to do some of those tasks with similar performance as a human. As an example, this technology is being tested today to asses damage to cars based on images. It will be very difficult to achieve the level of an VDA estimating damage to a car because of

all the variables involved, but there are interesting areas for applying this technology: a policyholder could be taking a series of pictures with his phone and with the help of AI, the insurer would have in real time a first and quick assessment of the parts damaged, helping to take decisions: is the car repairable? What kind of repair is needed?

Therefore, streamlining the claims management process. This can provide great benefits in terms of efficiency and therefore quality of the service provided to the policyholder.

Another relevant aspect of how technology is impacting claims, and that we need to consider, is how technology is present in some of the insured goods. Again, in motor claims, the evolution in automotive technology is making it really complex to estimate the damage to cars because of all the technology involved in a vehicle: sensors, different materials and construction techniques, safety devices, and autonomous driving devices - repairers are the true experts and getting cars back on the road safely is the first priority for all the stakeholders, therefore having the right information at the moment of estimating the damage and repairing the car is paramount.

PABLO LIÑARES,

Director of Consulting and Innovation Services, GT Motive.

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EDITORIAL

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Embracing technology for faster, fairer claims In the last 12 to 18 months, technology has begun to transform certain aspects of the claims process. On high-volume business, robotic processing automation (RPA) is dramatically reducing claims life cycles and improving the accuracy of claims estimation.

Meanwhile, Crawford’s WeGoLook and YouGoLook initiatives put technology in the hands of ‘Lookers’ and claimants via an app, meaning appraisals can be conducted on site, photos uploaded and legal documentation exchanged within minutes of an incident occurring.

In motor, RPA tools can now review images and automatically generate estimates based on the type of vehicle and damage sustained. Automation simplifies notification and expedites settlement, often saving weeks of manual claim investigation, while big data allows estimates to be made with ever-increasing accuracy, resulting in appropriate settlement sums.

These approaches all drive the cost out of claims. Broadspire’s parent company Crawford & Company is investing heavily in each of these technologies, and expects to see significant operational cost savings and improved claims performance over the coming years. Crucially, these efficiencies will be gained without reducing the quality of service, benefiting all in the value chain.

This reduces overall claims costs, which can quickly escalate if a claimant requires a hire car while a decision is being made, for example. As well as saving valuable time, automation reduces human error and takes basic tasks out of the hands of claims professionals, allowing them to add value on more complex cases.

Technology is also driving efficiency in various other lines of business, from property to employer’s liability. Drones, for example, allow adjusters to access dangerous or inaccessible locations faster than before, enabling them to quickly assess damage and potentially mitigate costs.

For now, RPA-driven automation is a key focus, though over time more sophisticated artificial intelligence will undoubtedly play a growing role in the claims process.

Crawford is also focused on creating a digital claims experience.

Millennials tend to be less concerned with human interaction in the claims process, and much of the innovation will centre on offering a fast, convenient, automated user experience for customers who want it.

JOHN FEARN,

Head of Motor Claims, Broadspire by Crawford & Company.

Improving customer service through better supply chain performance here in their supply chain can insurers place W more emphasis in order to offer the best customer service for their policyholders?

For insurers the supply chain is a valuable source of innovation which can deliver shorter cycle times and cost reductions, as well as contributing to an overall better customer service experience.

However, the complexity and scale of many insurance operations can also cause there to be duplication of activities within the supply chain, miss-communication from information being passed between parties and unnecessary delays whilst these issues are resolved. In the claims space, these problems directly impact on a customer’s perception of the insurers brand and renewal prospects.

In claims, the notion of First Call Resolution (FCR) is a way to approach the supply chain from the customer’s perspective. When the first notification of loss (FNOL) call or notification is made, the customer is looking for clear understanding of what will happen next and when. The claims handler at this point needs to gather all of the relevant information and accurately triage the claim, deploying the right services to resolve the customer’s problems. This critical moment may dictate if the claim moves smoothly through the rest of the supply chain or not.

In some FNOL processes the triage is quite basic and that may prolong the claim’s cycle. If a damaged vehicle is first assigned to a repair shop, only then to be assessed as a write off, the level of uncertainty for the customer is increased, as is the time to resolve the claim, along with increasing costs to the insurer during this time.

By using some of the latest technology tools and combining data sources really intelligent decision making can be achieved, resulting in a much higher level of accuracy and fewer problems and delays down the line.

Integration between supply chain systems is another feature of FCR and ensures that when the initial claim notification is received the customer is given the specific details of next steps e.g. the date, time and location for vehicle repairs because the FNOL system is linked to the repair solution, for example, and similarly for other services.

A further benefit of this development is in feeding back information to the customer as the claim progresses. One of the biggest concerns for customers is lack of communication. If something changes in the progress of the claim, like a parts delay, then real time data back into the claims manager ensures all parties are aligned and removes the potential for miss-communication.

JASON TRIPP,

Managing Director, Coplus MODERN

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Trust in your partnerships here in their supply chain can insurers W place more emphasis in order to offer the best customer service for their policyholders?

As the market grows more crowded year on year and industry bighitters fight to maintain their share, it’s never been more important to ensure the customer is at the centre of business strategy.

Guaranteeing a seamless customer experience is fundamental. It’s why insurers and brokers work with us – we’re renowned for being a service-driven business focused squarely on those who need us most – the policyholders.

Keeping drivers mobile after a non-fault accident is hugely important. Dealing with an incident can be a stressful and traumatic experience and ensuring the the customer can carry on with minimum fuss and maximum empathy helps to soften the impact. Delivering exemplary customer service is what we do as standard and it sets us apart.

In the event of an accident, the policyholder’s main concern is continued mobility and we can make that happen, which is critical in terms of customer satisfaction and retention. With this in mind, it makes sense for insurers to place greater emphasis on credit hire and to embrace the many benefits of outsourcing it.

We work to provide peace of mind for both the insurer and the policyholder, bridging the gap between the two. While their

vehicle may be off the road, it does not necessarily mean that the owner has the time to arrange an alternative. Credit hire firms, such as EDAM, work alongside insurers to provide them with the opportunity to use our specialist customer service professionals, trained to work empathetically with drivers. Working on a case by case basis, claims handlers get the policyholder back behind the wheel as swiftly as possible, whileproviding a positive, reassuring and considerate service from start to finish.

Insurers who choose to work in partnership with independent credit hire providers are doubtless benefitting twofold, both from their expertise and unrivalled resources. Having an extensive fleet located across a network of locations throughout the UK ensures that a customer can have access to a vehicle in as little as a few hours. We know what the policyholder wants and are best placed to provide it, thanks to our team of dedicated individuals.

We place a continued focus on improving the customer experience while upholding the insurer’s brand values and have reaped the rewards, winning four accolades for customer service in 2018 and another at the start of 2019, while seeing our Net Promoter Score (NPS) increase steadily to over 80. Insurers truly looking to offer the best customer service to their policyholders are those who have outsourced facets of their business that aren’t their specialism to trusted partners who can deliver day in, day out.

MARC LAFFERTY,

Chief Revenue Officer, EDAM Group.

Emerging risks and the challenges to growth The risk environment for all businesses is very dynamic today and insurers and professionals are no exceptions. Recently published risk surveys have highlighted new and emerging risk concerns. The effects of technology are ubiquitous. An added complication is the velocity of change, with the attendant strategic uncertainties.

There appears to be a shift in consciousness to more macro type risks. Surveys often reflect the risks that are uppermost in respondents’ minds, but there is a growing concern about risks to future growth arising from a changing competitive landscape and external factors. Some risks are operational in the traditional sense, but others fall more into the category of strategic, economic or political risk, where traditional risk controls may be less effective.

One way of thinking about risk categories is: 1. Conventional risks that are susceptible to current risk management controls 2. New risks which have conventional characteristics, e.g. cyber attacks 3. Emerging risks where the rulebook may be changing The traditional risks that are constant for professional firms include those arising from litigation and regulation. Privacy and information security risks are well established. Business interruption has emerged as a major concern. This may relate to well publicised cyber-attacks that restricted organisations’ ability to continue with

normal operations. Rising in prominence is the failure to attract and retain talent: this may reflect the demand for new skills and broader societal concerns.

The consciousness around the new and emerging risks seems to arise from the pace of change, increased competition and disruptive technology. Professionals are witnessing these phenomena through changing client demands, in new ways of delivering services and from disruptive new entrants. Some organisations may be faced with the simultaneous investment challenges of modernising core systems, elevating cyber security and reengineering processes.

This greater uncertainty creates a more challenging process for risk identification and mitigation. Transparency and interconnectedness of information, technology, and the mobility of people and services have changed the risk environment. Many of the new and emerging risks identified present insurability challenges. Data analytics and scenario planning are two tools that can be employed to understand and indeed price risks that have not traditionally been considered to be insurable.

There is a considerable innovation opportunity for insurers that can respond to these challenges.

KEITH TRACEY,

Managing Director, Aon Risk Solutions

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THE MODERN ALTERNATIVE IN THE VEHICLE REPAIR INDUSTRY FNOL / Triage

Engineering

Instruction / Profile management

Audit / Business Rules

Estimate

Management Information

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EDITORIAL

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“Sprinklers

– a traditional risk management solution for a modern world” General consensus suggests the first modern, recognisable sprinkler system was installed at the Theatre Royal, Drury Lane in 1812 by architect William Congreve. Whilst sprinkler technology has been modernised and improved in the 200 years since, the fundamental principles remain the same.

A properly designed, installed and maintained automatic sprinkler system will not only detect a fire, but also control or extinguish it, minimising potential damage from fire, smoke, heat and the large volume of water that would otherwise be used by fire fighters to put the fire out. This is as relevant now as it was back in 1812, with UK fire losses recently increasing both in number and severity. In 2018, the Fire and Rescue Services (FRSs) attended 181,436 fires – a 6% increase on the previous year, resulting in £1.3 billion being paid out by insurers.

Aside from the potential consequences of loss of life and environmental impact, a fire can signal the death-knell for a business, affecting jobs and the local economy. Damage to stock, machinery/plant and buildings can result in a business disruption event from which a business may struggle to survive or, in a worst case scenario, cease trading. For the average cost of a sprinkler system (around £30-£35 per square metre, installed as part of a new build project), the impact could be dramatically reduced.

Sprinkler system effectiveness in combatting fires is supported by impressive safety statistics. In fact, sprinklers reduce injuries by at least 80% and property damage by 90%. The UK industry trade body, the British Automatic Fire Sprinkler Association (BAFSA), records all successful sprinkler saves it is aware of, and the case studies make for persuasive reading.

Many insurance companies welcome the installation of a sufficient sprinkler system, which is often reflected in more favourable property insurance premiums, with potentially significant savings.

With so much at stake, it’s advisable for any business to consider the benefits a sprinkler system could bring and the consequences of not doing so. An old, tried and tested fire risk management solution, still very relevant in our modern world.

Visit Allianz Risk Management for more information on sprinkler systems and other fire safety measures.

ANDY MILLER,

Loss Control Engineering Technical Manager, Allianz Insurance. http://www.firesprinklersystemsuk.com/fire-sprinkler-systems.html ABI property insurance claims 2018 3 British Automatic Fire Sprinkler Association, 2017 1

2

How can telematics data help insurers to manage risk profiles?

Telematics has been long established in the young driver market, but it hasn’t really found its feet in the mass market as many analysts predicted. In fact, it appears more likely to find a niche at the other end of the scale (the older drivers) before any sizeable mass market adoption.

Frustrating no doubt for insurers, as clearly telematics data offers numerous ways to enhance risk selection and provides a platform from which ongoing risk can be managed.

These relatively new (when compared to traditional underwriting) risk rating factors range from assessing how a customer drives, to where they are driving and at what time of day the journey takes place. The next level of data, looks at more detail, understanding “cornering data” and adherence to speed limits.

As telematics has progressed over the years and technology becomes easier to integrate, insurers now have the benefit of relatively simple data overlays enhancing risk management further, weather data and accident black spot data being examples of such.

So, there is plenty of data to assist insurers, not so easy in practice to proactively manage the risk and actuaries have now moved from a model where years of historic risk data are used to predict what

happens in the future to assessing real time data to predict real-time occurrences.

However, despite the potential operational drain on the insurer, telematics has enabled them to begin the journey from risk assessing customers as part of a large pool of statistical data to assessing customers in smaller pools and one day may be individually.

Of course, insurers are also benefitting from telematics data indirectly as suppliers adopt the technology to track vehicles and proactively assess driver performance. From a moral perspective, few would argue that being able to assess a driver’s ability and take action to avoid an incident is far more important than the commercial benefit.

There is also the more practical use for suppliers who use telematics data within their own logistical systems in order to deliver a service.

Nationwide Assistance do just that, ensuring that the correct vehicle is sent first time and the customer knows exactly when its due to arrive. A process that directly benefits the insurer’s customer service outcomes and claims costs.

MILES KEEBLE,

Managing Director, MAK5 Limited.

Written on behalf of Nationwide Vehicle Assistance.

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How can telematics help to combat fraud?

New technology will certainly continue to make the claims process more efficient, whilst combating fraud. Voice analysis and speech recognition, metadata, image recognition, online video and techno-supported self-registration will all play an important role.

If it isn’t already, FNOL systems will likely be the most important development, immediately alerting emergency services and insurers to a potential problem with the ability to download telematics data/dash cam footage.

By analysing the deep data available with the use of device tampering detection, crash filtering and reporting, accelerometer to evaluate speed, a gyroscope to detect orientation of the device, GPS and rechargeable super capacitors for ignition logging, a claimant can’t lie about the circumstances and facts. Cutting-edge predictive modelling and crash algorithms can then work to detect whether an incident is true or not.

As a developing technology, it comes with caveats. It will improve further as raw data continues to become more verified and so trusted, cross-tested, greater in volume and cheaper to deliver.

The data will be recorded on a second by second basis, rather than a longer sampling. Telematic policies still only represent around half a million policies in the UK. They have had the most success in the young driver market, where premiums are relatively

high and so can easily cover the cost of installing a traditional telematics device. Telematics data will become more core to the claims process and insurers will become more adept at using the evidence.

Might it be possible to manipulate the telematics data by hacking or connecting external tools? Some experts think there may be vulnerabilities, particularly in relation to the cheaper user-installed device versions rather than the hard-wired devices.

New technologies such as telematics should help reduce fraud, investigation costs, the severity of claims, the impact they have on our lives, and the cost of putting situations back to the pre-claim state. Customers should be better rewarded with lower premiums for better and safe driving, with insurers benefiting from increased customer satisfaction and retention.

Technological solutions must always be balanced with the claimant’s needs at what could be a difficult time. The biggest trap that insurers may fall into is focusing on developing technologybased solutions rather than ones that focus on the customer.

DONNA SCULLY,

Director, Carpenters Group.

The journey towards autonomous vehicles hat challenges and opportunities do W autonomous vehicles present to the insurance industry?

The journey towards autonomous vehicles in the UK is well underway and we could see some new cars with highly advanced features introduced into the UK motor market as soon as 2021 -though full roll-out is more likely to be over the next 10-15 years.

The technology presents another huge milestone with the potential to dramatically improve road safety, following steps like the mandatory introduction of seat belts in 1983.

Despite initial fears about the unknown, driverless cars are likely to contribute to a reduction in accident frequency and hopefully accident severity. Though this is also dependent on individual driver behaviour and their understanding of the technology as it develops and how to engage with it.

As well as limits on the speed vehicles will travel at, opportunities exist around the gathering of current driver behaviour including accidents, their causes and how much of this is could be avoided with the aid of advancing technology. Further down the line, this has implications for pricing too, if the data (as is expected) shows a lower level of risk.

For the safety benefits to be realised during the development period, there needs to be a concerted effort around education so that drivers fully understand what the technology will and will not do. For example, where a speed limiter is active and the vehicle technology reacts, drivers need to be aware that they may need to travel below a set speed to take into account their immediate environment and potential hazards. For example, a school or severe weather conditions such as snow, ice or fog.

The detail of how autonomous vehicles will be introduced and used by the consumer will be set out by the Government and industry with consultation already underway. This includes careful consideration of the transition from manual cars with features like driver assist technology to fully automated vehicles.

There is still a long way to go with many issues to resolve, not least the fine tuning of the technology itself, though the motor industry, insurers, government and motorists will need to work together to ensure the technology is used to benefit everybody and that the appropriate levels of risk are reflected in people’s insurance cover.

CALUM McPHAIL,

Head of Motor, Zurich UK.

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Protect your clients by providing the right package of services.

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Market-leading, competitively priced insurance wholesaler for brokers and dealerships.

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On Insurance is a trading name of On Hire Ltd. On Hire Limited is authorised and regulated by the Financial Conduct Authority (Registered no. 480928)

The UK’s leading Independent Automotive Experts We look for the most cost effective, safe & efficient repair methods by liaising between insurer, repairer, recycler & manufacturer.

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0151 342 9961

enquiries@laird-assessors.com

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Changing perceptions can we encourage more people to enter How into a career in the vehicle repair industry?

The vehicle repair sector is in the midst of a skills shortage as businesses struggle to recruit new talent into an industry that is moving faster than its appeal to potential staff. According to research released by Direct Line Group in April, 6 in 10 British people now say they wouldn’t be interested in a career in automotive repairs, while others perceive the work environment as strenuous and labour intensive.

The dwindling recruitment pool could have a detrimental impact on policyholders, putting them in a position where, if garages can’t secure adequate staffing to sufficiently handle workloads, they might not receive their vehicle back within satisfactory timeframes.

So how do we tackle this?

First and foremost, the industry needs to alter perceptions, particularly among 16 to 25-year-olds considering their future career paths. Initiatives are already taking place to achieve this.

AutoRaise, the vehicle repair industry’s charity, is working with various training providers and repairers to encourage young people into the sector, presenting it as a dynamic workplace.

Thatcham Research is also among a group that recently launched a campaign showcasing exciting technologies and innovations in a bid to attract talent. It highlights what could feature in repair

centres by 2050, including self-diagnosing cars, augmented reality technology and ultra-connected workshops.

Auto Windscreens has also launched an ALEX (Apprenticeship Learning EXperience) programme, designed to attract people into the glass segment of the repair industry to address recruitment challenges. Apprentice automotive glazing technicians are put through NVQ qualifications in glass repairs and replacements, as well as being offered enrichment learning in leadership and customer care. The award-winning programme has just been through its first OFSTED, with inspectors commenting: “Apprentices enrol on a programme that will equip them with new skills, behaviours and attitudes that will benefit them and their employer.” A good apprentice can add huge benefits to a business but this relies on the business delivering learning programmes that are positive, engaging and productive.

As well as bringing new blood into the repair sector, there needs to be clear development routes; it is all very well introducing people into the industry but we also need to keep them. Ensuring staff remain enthused and presenting opportunities will be key in building up highly skilled workforces.

JAMES MACBETH,

Managing Director, Auto Windscreens.

A united front s more ADAS systems are introduced, how can A OEMs and insurance providers work towards reliable education and awareness of these systems for the public?

Tesla’s recent announcement that it intends to ‘go-it-alone’ for its InsureMyTesla service, was another confirmation that in terms of vehicle technology, a lot of the automotive-insurance business silos are shifting. The concept of insurance-as-a-service continues to gain traction, and there’s been similar statements from Ford, Volvo, BMW, Renault, Mercedes-Benz and Waymo/Google amongst others who all have in-house insurance packages and subscription packages of some kind.

At the heart of the issue is the increased digitisation of the car companies themselves and the increased role that ADAS (Advanced Driver Assistance Systems) plays in determining safety and risk.

For insurers, there’s a lot of competitive knowledge yet to be gained from the new vehicle technology. For vehicle OEMs, it’s about creating a beautiful experience in and around the vehicle and dashboard, and creating loyal customers.

Consumer education and confidence will need to be key and as a Thatcham Research report identified, there is a grey area right now in the handover between what the motorist thinks these features do, and what they can actually do.

At LexisNexis® we’ve made some forecasts on how this will evolve

over time and we’re getting ready to launch a series of score models and risk attributes in the UK and other markets, the ADAS Data Report, ADAS Score, Base Score and the Vehicle Score.

Vehicle technology and the associated data insights are going to have a positive effect on insurance underwriting and pricing. From the connected car we will begin to get additional data sources for insurance. These include the performance and the effect of these safety features in the real world. This in turn is going to feed back into insurance pricing as well as more efficient processes for the car makers and the diagnostics they require.

There are clear benefits for the consumer in the form of (usually) insurance premium discounts, a better overall vehicle experience, and insights of geographic use and other usage patterns that are going to be needed to drive new usage-based services. The consumer is going to be at the centre, with data enabling them to understand more about their car and how it interconnects with their lives.

There’s still a lot of work to be done explaining to the public the benefits, and what it really means for them. It’s going to take a cross-industry effort: two great industries, insurance and automotive, becoming more united.

TREVOR LLOYD-JONES, Senior Marketing Manager, Insurance LexisNexis Risk Solutions.

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The key to claims fulfilment has the role of bodyshops within the claims How process changed and adapted in recent years?

In writing this article, I should declare my obvious bias towards that of bodyshops, having spent eleven years as a Director of the UK’s largest bodyshop group and for the last four years working closely with Fix Auto as our <Connected Solutions> Repair Partner.

During this period of time it has always been very apparent to me that bodyshops are the centric part of a motor claim and are very much key to the existence of claims fulfilment. This is demonstrable by the fact that bodyshops are not only required to repair the damaged vehicle (claims fulfilment), but also the admin and identification centre for insurers and accident management companies. In today’s world, the bodyshop carries out far more than just repairing the car. For example, identification of fault and non-fault claims (gasp… a service that exists as much for insurers’ income streams as it is does for accident management companies), supply chain purchasing via the insurers preferred (or mandated) supplier, on and off hiring of rental vehicles, completing often complicated invoicing schedules to accommodate insurer requests, congestion charges, speeding charges, fraud identification, indemnity validation,

complaint handling adhering to FCA guidelines and last but not least arranging insurance cover for third party courtesy vehicles (actually there are many more).

It has been talked about a lot in recent times about the evolution of vehicle technology and the increased complexities of repair and the consequent investment required to ensure the safe repair of vehicles. If you put yourself in the shoes of a bodyshop owner, not only do you have these technical and investment challenges, but you also have the claims processes being arguably more intense and critical at the bodyshop too. Whether this has been a wilful shift to move cost and responsibility to the bodyshop or whether it has happened by default, the reality is, the bodyshop has become far more than a vehicle repairer. However, commercially, the rates are broadly the same as they have been for 10-15 years. If you reviewed the profitability of all the parties involved in the motor claims process, you would most likely find the bodyshop to be the most marginal? Given the centric nature of their activities, is this sustainable?

STEVE THOMPSON,

Director, InduSTry Insights.

How is technology changing the way we estimate claims?

Excellence in claims estimating can provide an insurer with a real competitive advantage. Having consistent and accurate reserves is a foundational requirement for a claims function to ensure there are sufficient funds to pay future claims costs. But some insurers also recognise that being highly effective at claims estimating opens up opportunities for their pricing, underwriting and actuarial teams.

Reliable claims estimating provides these functions with a sound basis on which they can confidently make day-to-day business decisions, enabling them to be first movers in a market or agile in changing circumstances, both vital attributes in a highly competitive environment.

Delivering robust and reliable claim estimating has its challenges for a claims function with operational workloads, inexperienced resources, delays in identifying new and emerging claims trends being just some examples of the hindering factors.

Advancement in technology is improving the efficiency and accuracy of estimating across the lifecycle of a claim. A key driver is the substantial increase in data points which can be leveraged. These are coming from richer structured data, often generated following investment in an upgraded claims platform, and the ability to tap into unstructured data such as correspondence, notes, photos, voice or through augmenting with external data sources. The digitisation of

these assets means that hundreds, sometimes thousands, of factors can be created to reflect the key characteristics of a claim.

Machine learning can then be utilised to assess these characteristics (multiple data factors) for an individual claim and compare it to other similar claims to accurately predict its cost. A variety of these analytical models can then support the estimating process across the claim lifecycle. Starting right from the FNOL where models help evaluate the severity of the event and may also be used to assess whether the insurable item is repairable or beyond economic repair.

Trained analytical models can also help identify factors that are less obvious to an inexperienced human eye, for example, flagging that a claim is likely to become a large loss which enables pro-active intervention from an experienced technical handler.

Insurers who have an enterprise decision engine as part of their technology stack can host multiple models on this platform and integrate it with their claims system to provide real-time decision support, estimation and automation.

TOM HELM, Head of Claims Consulting at Insurance Consulting and Technology, Willis Towers Watson.

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Working Together Nationwide Assistance Group works with insurance companies to mitigate the cost of a claim by providing a complete collision recovery management service.Our high level of standards means that we know the importance of capturing the right details when completing FNOL’s through to deploying the correct recovery vehicle.We do not stop there, being your eyes on scene means we can advise if the vehicle should be taken to salvage rather than repair, reducing movement costs. Where a vehicle is in storage we ensure that we deliver that vehicle to a repairers or salvage company as quickly as possible to mitigate the storage costs and save you money.

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Embracing green parts have green initiatives been embraced by How the repair and/or insurance industry?

There was a time when ‘green’ parts were sourced after by climbing over a damaged car or three in a muddy scrap yard, watched by hungry guard dogs. Saws and angle grinders were the removal tool of choice. Today the vehicle recycling business is a very different scene akin to a manufacturer’s factory than a postapocalyptic car graveyard.

Green parts are now identified, cleaned, catalogued and can be ordered online, sometimes faster than OEM parts. However, the industry has mixed feelings about them…

The repairer

Green parts by their very nature are cheaper, so there is not the same level of profit, although the mark up is currently unregulated.

Availability can be a concern; stock is dependent on written-off vehicles being available; good for Fords, not so much for Bentleys.

So why would a bodyshop choose less profitable green parts, particularly when they make take longer to source?

The answer is twofold; firstly, cheaper parts may mean the difference between a total loss and repairable proposition.

Bodyshops are in the business of repairing cars so may take a commercial view that a repairable car means work albeit with slightly less profit.

Secondly, green parts may be quicker to fit in some cases.

For example, a door will come with the various clips, brackets, regulator, etc., meaning less MET time. In some cases parts are sourced already painted in the car’s colour.

It can sometimes be better for older models. For instance, some earlier headlamps frost, meaning a new replacement can look obvious compared to a similarly aged replacement.

The insurer

The insurer has a duty to ensure that a vehicle is repaired safely but in the most cost effective manner. There are concerns over the quality and sometimes lack of warranty of a green part. The policy holder may object to having their pride and joy repaired using parts salvaged from another crashed vehicle.

The cost savings can be attractive to an insurer assuming the above concerns are overcome. Additionally, the utilisation of green parts to prevent a car from becoming a total loss can ensure policy holder retention, as many are lost once their vehicle is written off.

The environmental benefits are clear; no need to import replacement parts from a manufacturer plus the revenue is kept within the UK’s motor industry.

Conclusion

There are pros and cons here but as the salvage industry moves to modern warehousing techniques, technology and logistics, we expect to see the benefits of green parts embraced further in the future.

NIK ELLIS,

Managing Director, Laird Assessors.

Will there be real trust? ow might the customer’s relationship with their H vehicle change with the introduction of more autonomous technology?

Elon Musk the founder of Tesla motorcars, Paypal and SpaceX stated that “I’m very convinced... In the future, people will want to outlaw people driving their own cars because they’ll be unsafe.”

A provocative statement from a tech giant who is no stranger to courting controversy, but it does raise a question. What will the human/autonomous vehicle relationship look like in years to come?

Will there be real trust?

struggles to differentiate between the driver crossing the line and a road with camber changes – how would an autonomous vehicle be any better? In contrast to Elon’s thought about people being unsafe, often modern safety systems can feel more like a distraction rather than a safety measure.

So, here’s the central issue; how safe would you feel in a vehicle you had no control over? One that had no steering wheel or pedals for you to use in an emergency. Currently computers fly airplanes, sometimes with terrible consequences. We are having to rethink what’s possible and the same occurs with the car.

Currently, Tesla offers “autopilot” across their model range demonstrating the fundamental technology is already there for a car to drive itself, however, the fully autonomous aspects are still lacking.

What do we mean by that? The decision-making aspect, i.e. if the car is going to have to crash into a human, does it choose the two 95-year olds or the single teenager? This question hasn’t yet – and might not ever - be answered.

Customers like technology that makes their life easier and more convenient and autonomous vehicles would certainly do that if there was 100% trust in them. But if the guidance systems in my car are anything to go by, many people will always harbour doubts.

Autonomous features might assist people in driving their vehicle and prove to be a real winner, but I’d be doubtful you’d ever see people having enough faith in them to ever find out if they were safer than a human or not.

This poses the question about how much “faith” a driver will put in the hands of an autonomous vehicle. In my car, the “Lane Assistance”

Managing Director, Insure Apps.

STEPHEN MARSHALL ACII,

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EDITORIAL

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How is technology changing the way we estimate claims?

While insurance telematics is better known for the proposition of insurance premium discounts, the hidden gems of telematics shine through in the event of an accident. Today, by utilising this technology and a strong accident data repository, the data collected during the accident and the elaboration of them operated by artificial intelligence makes it possible to estimate the cost of repair within minutes. This is all done automatically and communicated in near real-time, vastly improving the communication time and quality between the insurer and the bodyshop. This approach simplifies the approvals, streamlines the process that keeps claims handling costs to minimum, and all the while leaves a positive experience for the claimant.

Furthermore, the technology supporting this at the backend continues to develop. As the data collected is merged with claim report information to support the evolution of the algorithm with machine learning. This works by continuously updating the ‘golden sample’ with a selection of new qualified data sets, providing a measurement tool for identifying true or false events as well as a training tool for the algorithm. This is done at minimum on a monthly cycle to consider the changing real-world environment that is provided by Boundary Condition inputs such as the weather, traffic conditions, known black spots and even changing

vehicle specifications. As a result, the accuracy of the repair cost estimation is continuously improved. The same data can then be used to build automatic quality control on bodyshop activities.

This is in the context of a growing numbers of interconnections among stakeholders, in particular the databases of vehicle manufacturers and part suppliers to reduce repair times and improve quality.

As we see the introduction of autonomous vehicles, the number of road accidents and therefore repair jobs will decline. However, the smaller number of accidents will come with more complexity, including who bears the cost of repair, approval of and cost estimates of the claim based on an expanded number of sensors.

As an added responsibility of autonomous vehicles, the quality of the repair must satisfy the insurer, policyholder and regulators to ensure autonomous functions are still safe and reliable. No doubt telematics technology will continue to play a pivotal role in supporting the insurer-bodyshop relationship and helping them navigate these new challenges.

MARCO AMENDOLAGINE,

Director of Product: Crash and Claims, Octo Telematics.

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For cutting edge innovation, marketing-leading data insights, and the collaboration your business needs, contact us.

SECTOR

PAUL NICHOLLS is Chair of the Motor Accident Solicitors Society (MASS) and a Senior Partner in Nicholls Brimble Bhol.

SOAPBOX

Let’s talk premiums

he wondrous abilities of insurers never fail to impress. Almost a year before T implementation of the Civil Liability Act and the whiplash reforms and lo and behold, a spate of headlines appear proclaiming that premiums have fallen due to the reforms. Doubly miraculous given that the average claim takes twelve months to resolve. If there are indeed any savings to come, logic would dictate that they would not start filtering through the system until 2021, but insurers have spectacularly pulled savings out of the bag a whole two years before they are realised. Bless them.

The reality is that this recent dip has absolutely nothing to do with the reforms and it is an insult to our intelligence to claim otherwise. There are many influences upon premiums including competitive pressures, cyclical trends, loss leading versus other forms of insurance, repair bills and taxes such as the Insurance Premium Tax, but that won’t stop insurers from inevitably pinning the blame on legal costs.

Even though legal costs have been falling for over ten years, having been fixed for RTA cases in 2003, revised downwards in 2010 and falling again by 60% following the LASPO cost reforms, Of course, as was starkly emphasised in the Treasury’s recent consultation on the new statutory requirements for premium information on insurers, we won’t find out the truth about any savings from the reforms until way off into the distance, around 2024/25. Between now and then, there will be all sorts of opportunities for further “adjustments” and new narratives apportioning blame. The ABI’s James

Controlling claims inflation

in the future

Dalton was undoubtedly being honest when he told the Justice Committee in 2017 that “premiums will not go up as much if these personal injury reforms are implemented.”

Many of us will remain deeply sceptical about the commitment made to return savings to customers. The sector has a poor historical record on passing on sustained savings through lower premiums. When costs are supposedly taken out of the system, it is not a one-off event but taken out for good, year on year.

The time for Government and regulators to act and genuinely hold insurers to account is long overdue. Consumers shouldn’t have to wait until the mid-2020s before the issue is considered again.

JAMES HEATH

is the President of the Forum of Insurance Lawyers, and Partner at Keoghs.

One of the main issues impacting claims inflation is the advancement of vehicle technology itself.

As we become a technologically dependant society, vehicle manufacturers have naturally followed suit. From the introduction of indicators (1939) and tape decks (1970’s), to electric and self-driving vehicles, the market has developed rapidly to meet consumer demand.

Whilst consumers will rightly demand safer, “greener” and technology laden vehicles, the insurance market sees month on month inflation resultant from these advancements.

Average repair cost has increased by over 40% in the last 10 years with the total parts cost inflation trending at a similar level. Safety technology (supported by ENCAP) is now integrated at vehicle locations regularly involved in incidents; parking sensors, Collision Warning Systems, crumple zones and deflectors all now feature in the repair of a modern vehicle. Furthermore, the significant transition from “repair to replace”, coupled with the increasing cost of parts, increases both the cost and time required to complete the repair.

Accident Repair Centres and Body Shops have needed to adapt to this changing world, purchasing and employing new technologies, to maintain the required capability to repair increasingly sophisticated vehicles. These associated costs will inevitably be passed on to the end user, the insurer.

also experienced steep credit repair claims inflation.

Keoghs’ own analysis, taken from our volume Credit Hire Unit, shows a 27% increase in Credit Repair since 2015.

With the average Credit Repair costing c£600 more than an insurer repair, it is evident that companies within the Accident Management arena have established mechanisms to maximise their revenue streams. As repair durations increase, so too does the average credit hire claim and - with reforms pending - this inflation may see the claimant supply chain focus more on the vehicle than the injured party in order to maximise returns per incident, whilst impacting proposed claims track limits.

Whilst we should enjoy safer, cleaner, vehicles, insurers must remain on the front foot in understanding, and where viable, tackling these inflationary mechanisms.

Technology will not abate so ensuring repairers are well equipped, understand emerging opportunities such as green parts and managing the direction of policy holder repairs will all become key to controlling claims inflation in the future.

The Accident Management market has MODERN

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SECTOR

SOAPBOX

InsureTech Rising,

Insurance of Tech...?

I

t was Easter weekend, the sun was shining; the sun cream had made its first appearance of the year, and my wife and I chose to go into battle with our local motor dealer to buy a new car. Having watched David Attenborough’s most recent natural history documentary about the future of the planet, we decided to try and do our bit and go for a fully electric, environmentally friendly vehicle.

When viewing the car, the salesman opened the bonnet to reveal mostly a void where the engine would normally be, prefaced by the comment of “we are not allowed to touch any of that.”! The mechanics of old are no longer dealing with the internal combustion engine!

When you stop to consider the technology of a motor vehicle; electric turbines, distance sensors comprising of parts to the weapons system of an Apache helicopter, combined with automated braking and high tech windscreens that detect rain, we have effectively changed the skill set required by those who repair our vehicles after an insurance claim.

It seems that the technological capability of a vehicle can exceed the technological capability of those who repair them. I recently suffered a chip to my windscreen which required a replacement. I booked the vehicle on the e-booking system of the windscreen repairer to arrange a home visit. This ultimately proved fruitless as I received a call after the appointment was made to say that it could only be replaced in the workshop.

ANDREW GIBBONS ACII, is Managing Director, Mason Owen Financial Services Ltd; BIBA, Chair of Industry Claims Initiative.

afternoon. When I picked it up, I was told I would have to take the car to the main dealer because the conventional windscreen repair shop could not recalibrate the windscreen due to a fault on the dashboard. In addition, the sunroof would not open, the internal lighting and the front vehicle sensors for parking were also off. The main dealer established that several wires had been cut during the removal of the damaged windscreen!

The vast infrastructure investment that is required to bring our repair capability up to speed is one of the biggest challenges for the claims supply chain in the future.

This is of course assuming that the insurance market will provide cover for emerging risks, which is becoming more challenging in certain parts of the sharing economy and for high-tech vehicles that have come to market in recent years.

Certainly innovation is needed to enable us to keep pace.

The vehicle was duly taken to the repair centre where I left it to be repaired that

Introducing APIL’s new President:

GORDON DALYELL is President of the Association of

Personal Injury Lawyers (APIL).

Gordon Dalyell

A

s little as five years ago I would have been dubious as to whether a Celtic lawyer could be president of APIL. But here I am. I am the association’s 22nd president and the first from Scotland.

In that time, the pace of change in personal injury has been relentless. The reforms to each of the civil systems in the UK have amalgamated into a very similar set of issues and unity in our work across the jurisdictions has never made more sense.

An injured person’s needs are the same regardless of where he is. The difference lies in what can be done to help him. In some areas the differences are stark.

For example, it is cheaper to kill someone through negligence in Belfast than it is in Glasgow. But it is cheaper still to kill them in Birmingham or Cardiff. The level of statutory bereavement damages in Northern Ireland increased recently to £15,100. In England and Wales meanwhile, the sum has languished at £12,980 for the past six years. We look to Scotland where each case is examined individually, and the law is much more flexible about who is eligible for compensation after the untimely death of a loved one.

APIL is still arguing for a fair discount rate.

The impact runs deep in all four corners of the UK. The newly-calculated rates will be unveiled later this summer and APIL will

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look very carefully at how the conclusions were made and monitor the impact. We have been at the forefront of campaigning on the discount rate for many years and it was APIL’s action which resulted in the 2017 review which brought the rate down to -0.75 per cent. We do not always get what we want, the whiplash reforms being an example. But we will take every opportunity to continue to influence the implementation of the reforms through our involvement in discussions on the technical detail of the new system.

Meanwhile, some crucial work is underway behind the scenes on new projects to preserve and expand access to justice for injured people. Legislation is being written, meetings are underway, and our members are providing evidence. Fascinating, times lie ahead as we move towards our 30th year.

SECTOR

DR MATTHEW CONNELL, Director, Policy and Public Affairs, Chartered Insurance Institute (CII).

SOAPBOX

Essential for customer trust

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he car repair industry is vastly more sophisticated than it has ever been - modern cars are some of the most advanced machines we have ever produced, containing a level of processing power that would put the supercomputers of previous decades to shame.

Consider the amount of code that is needed to be advanced machines. In 2013, an F-35 fighter jet used 24 million lines of code, while the Large Hadron Collider is supported by fifty million lines of code.

All this programming combined does not come close to the average modern highend car, which can use one hundred million lines of code.

Some of this sophistication makes cars easier to maintain, but it also means that repairing them can be far more complex.

With cars covered with an increasing number of sensors, repairing them is increasingly an electronic rather than a mechanical job.

This all takes time and costs money – in an environment where insurers are competing on cost and speed of claims above all else.

In these circumstances, the only way to avoid eroding levels of customer service is find ways for the customer to stay in control while repairs are being made – for example, by getting the right courtesy car to them, in a way that doesn’t disrupt their busy lives, or by keeping them informed through apps that show the progress of the work.

In many ways, the logistical challenges of accident management put the work of higher profile businesses like Amazon and Uber in the shade.

Getting this network of services right, however, is essential to consumer trust.

For many consumers, a motor claim may be the only insurance claim they make for many years – it will be the one experience they have of the benefits of insurance across all the policies that they pay into.

Getting things right in the repair industry is the best clue most consumers get about how their home insurance claim will be dealt with if their house is flooded, about how their travel insurance claim will be treated if they fall ill abroad, or how their disability claim will be dealt with if they fall ill. As a profession, car repair forms a crucial window on what we do.

F E AT U R E S

Industry Innovators Interview:

Claim Technology Transforming insurance claims by making it easier and faster for customers to make an insurance claim using an intelligent chatbot, web or mobile apps, Michael Lewis, CEO at Claim Technology is changing the game.

Over a year since the introduction of Claim Technology, we hear about their future plans and how they are turning the claims process upside down.

One year from now, we will have become the industry standard solution for automating complex, personal injury claims in a post-whiplash reforms environment with a single click

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Q How would you describe Claim Technology in three words?

Innovation, automation, freedom.

Q What makes Claim Technology different from other start-up companies?

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Like other tech start-ups, we have a clear vision, a strong technology platform and a great team. However, unlike other tech start-ups: We have deep domain expertise in insurance claims processing (over 60 year’s collective experience working inside claims at senior levels across Operations and IT).

Our knowledge is used to either reduce insurer indemnity costs or generate new income streams for clients where our technology platform acts as the enabler.

We are able to implement solutions with little to no input from our client, thereby being a valuable strategic partner for busy operations and IT teams.

Q What would you identify as the gap in the market that Claim Technology aims to fill?

We provide the digital tools to automate claims processes without IT needing to build these in-house. With no IT knowledge required, our platform enable operations staff and business analysts to design, build and deploy a one-click claims process and create a rich, multi-channel digital experience for their customer. Creating automated business processes in the cloud is at least five times faster than current IT teams can achieve. Freed from the constraints of legacy systems or in-house IT teams, operations are now finally able to achieve operational claims excellence through continuous improvement and achieve the seemingly impossible; reducing operating and indemnity costs, whilst at the same time improving capacity and the customer experience.

Our platform is ideal for companies who want to innovate, experiment and learn. With over a dozen integrations from leading insurtech and fintech providers (and growing), our platform is a claims playground for testing new insurtech on a PAYG basis, whilst our platform marketplace has out-of-the-box claims automation solutions that are ready to deploy alongside your existing case management solution. For example, customers using our Stage 1 RTA Personal Injury addon can see up to 95% reductions in touch time where the customer self-serves their claim using our AI chatbot, Robin.

What were the main challenges Q in standing out and establishing yourself in a competitive market?

How are new consumer buying Q habits forcing change in the insurance industry?

Our initial challenge was to cogently describe the platform. Were we an enterprise grade chatbot builder, a BPM automation platform or an insurtech eco-system? Describing ourselves as the industry’s only Claims-as-a-Service platform has resonated – we’re the AWS of claims. A second challenge became pricing – how do we price the solution so that adoption is a no-brainer? Our PAYG model start from as little as £99 a month, making our claims automation platform available to everyone. Our current challenge is now generating and converting leads – how do we on-board B2B customers who are used to a traditional sales cycle measured in years and months and convince them to simply sign up on our website and start automating today?

Price comparison sites have made it easy for customers to find the lowest priced policy for mass-market products, but with comparison sites earning commissions in year one from insurers, they are financially incentivised to churn customers, whereas insurers need to be able to retain new customers if they are to avoid making a loss. New customer apps are making it easier to purchase more bespoke insurance that insurers haven’t been well placed to offer, or cut the insurer out altogether through P2P. So how can we help insurers? Consumers make purchasing decisions based on the ease of doing business. I know I can buy an EasyJet flight in seconds, whereas booking with British Airways can take almost as long as the short haul flight I am buying a ticket for. Which company am I more likely to use and then rave about? Our automation platform enables you to provide customers, today, with deep, digital access into your product, so that they can selfserve their questions, fulfil tasks and process claims from any device, at any time. If you are offered a process that is as easy as purchasing on Amazon, wouldn’t you think twice about changing to another insurer?

How is the wider industry Q responding to challenges in your area of the market, and how are you tackling these?

Over the past two years the focus in insurtech has been on product and distribution. It’s only now that we are starting to see claims automation and the need to create great digital customer experiences making their way onto the main corporate agenda.

Claims is too important a function to ignore. Many organisations have started to automate the FNOL process, but how do you get from there to making automated decisions on liability, automating the fulfilment process, capturing losses from different sources and then settling the claim, whilst enhancing counter-fraud? Our platform provides all the digital infrastructure to underpin these automation efforts and make touchless claims a reality.

How is technology influencing Q Claim Technology’s service offering, and how will this be developed in the future?

We set out to turn claims upside-down.

Whereas companies expect customers to fit around the systems, processes and supply

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Our platform is ideal for companies who want to innovate, experiment and learn chain solutions they have put in place, our goal was to create a claims process designed entirely around the needs of the customer, whilst solving the structural issues inherent within insurance. Our technology is built on the belief that we design around the customer first and foremost. We were early believers in the potential for chatbots, (notwithstanding how immature the market still is) and we have developed a world-class enterprise grade chatbot builder to provide a single consistent interface for customers to engage with businesses at any time, for any need, and from any channel or device in a way that enhances, rather than detracts from the current customer experience.

Advancements in NLP, AI and digital voice will further shape how we are able to deliver seamless solutions and how our claims solutions will be consumed by people or other Internet of Thing devices.

unique about the culture at Claim QWhat’s Technology?

We’re a digital business, so unlike product manufacturers who need physical plants, local staff and centralised management control we don’t. As a digital business, our offices are virtual, we assemble the best talent from all over the world and we genuinely have a zero hierarchy structure. Our team members also choose the days and hours they wish to work and where they want to work from, enabling everyone to achieve the work/life balance that works for them. What matters is that we are focussed on achieving targets, pulling in the same direction and creating a great B2B2C product.

One very interesting concept we have introduced is called ‘pairworking’. Unlike current work practices where someone works alone and then hands off to someone else via email, who then sits on the item before e-mailing it back (a ‘linear’, time-consuming way of working), our team is encouraged to work in pairs, collaboratively in real-time. Whilst assigning two pairs of eyes to a task may seem wasteful, it actually enables us to eliminate waste (poor design, lost time etc.) and create much higher quality, finished deliverables within the same day. There’s an oft-heard phrase expressed by everyone in the team; ‘what’s stopping me from achieving X today?’ We are also minimalists, with an obsession for design and engineering so we excel at making something complex, simple.

do you see Claim Technology this time QWhere next year?

One year from now, we will have become the industry standard solution for automating complex, personal injury claims in a postwhiplash reforms environment with a single click. Having solved as difficult a claims journey as personal injury, we will have started in parallel to gain real traction with insurers and their supply chain for deploying other one-click claims processes in household, motor, travel and beyond. No interview could fail to mention Brexit, so with the UK being global leaders in insurance and insurtech, wouldn’t it be wonderful if post-Brexit, our team could take brand UK and our culture of flexible working, to travel to other international cities and start transforming the claims landscape one city at a time?

advice would you give to anyone else QWhat looking to disrupt an industry?

The path of an entrepreneur and the road to disruption is plagued with self-doubt. Whilst you may see the big picture and how everything is connected, what seems obvious and inevitable to you may not be where the market is at. Maintain belief in your core principles whilst remaining flexible to change. And if you’re lucky, you’ll ride the wave when others catch-up.

Michael Lewis is the CEO of Claim Technology.

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We set out to turn claims upside-down

F E AT U R E S

IOT AND BIG DATA ARE CHANGING THE INSURANCE, AUTOMOTIVE AND MOBILITY SECTORS Octo solutions enable: Digital transformation Creation of an ecosystem Income diversification Dynamic risk assessment Reduction of claim costs Improved relationships with the insured

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2019

BIBA

Widely acknowledged as the leading insurance intermediary conference and exhibition, the British Insurance Brokers’ Association’s annual event yet again produced a unique networking opportunity for all those involved in the industry. With an eclectic mix of speakers and seminar sessions, and of course the Hackathon, this year’s BIBA conference was not one to miss.

Modern Insurance captured the occasion in a snapshot of interviews below.

This year’s BIBA conference and exhibition was all about ‘Leading the Way’. The theme reflects the state of change the industry is currently operating under. As we await confirmation of a new Prime Minister and a plan for our transition away from Europe, the pace of technology advancements continues to quicken, while brokers continue to deal with changing customer needs and risk, as well as evolving regulation and legislation.

This year’s host was BBC Broadcaster, Huw Edwards. Baroness ManninghamBuller LG DCB, former head of MI5 was the opening keynote, enlightening us with her thoughts on leadership in these uncertain

times. Panel and seminar sessions took place over the two days, covering topics such as claims, innovation, regulation, Brexit and access to insurance.

BIBA’s Hackathon returned following its successful turnout last year. Teams went head to head facing challenges to create technology-led solutions for brokers.

The most notable moments of BIBA 2019 were Boris Johnson’s confirmation of his bid for Tory leadership and the ‘Opening up about Mental Health’ panel, comprised of household names who have had direct experience of living with mental health issues, and who are leading the way in

developing more open conversation around such subjects: Freddie Flintoff, England Cricketer; Professor Green, award winning rapper, singer and songwriter; and Katie Piper, presenter. Each individual shared their story and parted with advice for anyone struggling with mental health.

Overall it was a thought-provoking and much needed conversation for the industry.

BIBA 2019 was a fantastic event, bringing individuals and businesses together to connect and discuss current opportunities, with people going away feeling more empowered and ready for the challenges ahead.

It was a fantastic event, bringing individuals and businesses together to connect and discuss current opportunities, with people going away feeling more empowered and ready for the challenges ahead

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On the sofa with…

Sam White, Pukka Insure While at BIBA, we caught up with Sam White, CEO at Pukka Insure. We discussed the year ahead and what Sam is putting at the top of her agenda.

MIM: Great to see you at BIBA 2019 Sam. Let’s start with your main focus points for the year ahead…

Sam White: The next big challenge is the consumer journey and digital engagement.

I still feel that we are not quite getting it right. The insurance industry is still too complicated and there is a real lack of understanding of the consumer’s viewpoint.

For us, the next stage is looking at the consumer’s journey and working out how we can simplify it and use technology to enable a better journey.

MIM: How are you hoping to simplify insurance for the public?

SW: We need to take out the jargon used in the insurance industry. It is about how we tell people the truth when they take out a policy - what they are getting and how to navigate their policy correctly.

MIM: Do you think we could learn from any other sectors?

SW: Absolutely. From my experience as a consumer, banking has nailed it over the last couple of years. In insurance, we have similar environmental and regulatory challenges to the financial sector, so I believe that the insurance industry could learn an awful lot from banking.

MIM: What is happening in 2019 for Pukka Insure?

SW: As usual, we have got a lot going on! We have our new Head in Australia at BIBA showing her what UK insurance is like. We will be launching a new motor insurance brand in Australia as part of a group, not specifically Pukka Insure. From a UK perspective, we are looking to expand further into the market. We launched private car last year, so we want to be moving into new distribution channels and expanding our footprint into other areas.

MIM: What do you hope to achieve in terms of diversity and inclusion this year?

SW: We talk a lot about meritocracy at Pukka Insure, and I am quite often quoted that 70% of our management team are female but that is not because they are female, that is because they were the best person for the job. For me, one of the areas that I think is really important to tackle as a business is flexible working environments. Women end up being overtly negatively affected over their male counterparts around child care and their ability to be in the office on normal working hours. Working out how we can enable that remote, flexible working environment has got to be pretty high on the agenda and it will enable us to facilitate better opportunities for everyone regardless of their domestic circumstances, I think that will be the key driver to enabling more women to work at a senior level.

Sam White

is the CEO and Founder of Freedom Services Group, Freedom Brokers, Action 365 and Pukka Insure.

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10 Minutes With…

Steve White Modern Insurance spoke to Steve White, CEO at BIBA, about their plans for 2019 and the highlights of the conference this year.

Tell us why you decided on the theme of risks and opportunities for BIBA’s manifesto this year?

Steve White: The theme ‘risks and opportunities’ came from our tour of the regions that we do each autumn. The tour of the regions aims to achieve three things. Firstly, it demonstrates the visibility that I promised as BIBA’s Chief Executive when I took the role six years ago. Secondly, it gives us a chance to meet with our members and discuss what we are doing for them. And thirdly, and most importantly, we pin our ears back and listen to the issues they might be experiencing. We do fifteen sessions which we then take to our advisory board, our main board, and our technical committees, and out of that spawns the manifesto. That then becomes our lobbying document for the year.

MIM: Why did BIBA decide on the theme ‘Leading the way’ for this year’s conference?

SW: We believe the statement ‘leading the way’ nicely sums up not only what BIBA does but what brokers, insurance and financial services do. You heard Boris Johnson say how important financial services was to the UK and the UK economy; insurance is the oil that underpins all business life, if there was no insurance, planes couldn’t take off, ships couldn’t sail and cars couldn’t drive.

MIM: What opportunities are we likely to see come from InsurTech for the insurance broking sector?

SW: In the address I gave on stage, we looked at how the world has become more digitised for our customers. Our customers expect to do business via a variety of digital channels so we have to adapt in order to meet their expectations. We have a number of schemes and facilities that we make available to our members that are backed by the different technologies available. Technology is all around us and we need to be utilising that.

MIM: How is BIBA helping its members to upskill in terms of technology? Why is it important that the sector gets on board with technology and the digital revolution?

SW: The skills that you need in the modern workplace are changing and you can’t just rely on the old skills that we sort from generations before us. We are working with Google and other software houses to improve digital upskilling. The feedback has been fantastic so far. We are committed to it and our members have a great enthusiasm for it too.

MIM: The UK is facing a time of unprecedented change this year. What challenges and opportunities can we expect to face?

SW: There are a number of broad areas where changes are occurring – Brexit is an obvious one. We don’t know what the end point is going to look like and we don’t know when that end point is at this stage, so we are keeping our eyes and ears to ground and will be updating members as and when information is available.

The weight of regulation, despite our sector being recognised by the regulator as low risk, is another challenge for us. They still bombard our sector with a new paper every fortnight, which is a scary amount of activity. We are asking the regulators to think again by drawing parallels with what happened in Australia with the results of their royal commission, which summarised the future as less but more effective regulation.

MIM: How would you encourage the industry to stay ahead and thrive?

SW: There are a number of areas. Keeping abreast of what is happening in the talent space, we are already seeing that younger staff are wanting to work in a business where there is a culture around diversity and mental wellbeing. Firms need to look at their own internal cultures. Are they taking an inclusive view in terms of staff selections, promotions, pay and benefits; is there an open culture around mental well-being? These are all questions we need to be asking.

MIM: What have you enjoyed the most about BIBA this year?

SW: The feedback from the mental wellbeing talk has been fantastic and to have Boris Johnson on stage declaring that he will be running to be considered as the next Conservative Party’s leader, and seeing the national media pick up on it immediately, is phenomenal.

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Steve White

is the Chief Executive at BIBA.

F E AT U R E S

Let’s talk claims A claim event which impacts the normal operation of a business needs to be handled promptly and intelligently.

Damian Glynn, Head of Financial Risks at Sedgwick and Chairman of the CILA Business Interruption SIG Committee, is a seasoned loss adjuster finding appropriate solutions to business interruption claims. Modern Insurance spoke to him about the claims journey, and how it could be enhanced further following his panel session at BIBA 2019.

MIM: Tell us a bit about yourself Damian and your role as Head of Financial Risks at Sedgwick…

Damian Glynn: I am a dual certified Chartered Accountant and Chartered Loss Adjuster.

I am a practicing adjuster, dealing mainly with higher value claims. I spend at least a third of my time visiting people pre-risk to try and avoid surprises, and I have been Chairman of the CILA Business Interruption SIG Committee for twelve years.

MIM: We attended your panel session at BIBA 2019, talking about claims. How would you say the claims landscape is changing or evolving?

DG: While we have achieved considerable progress in the claims journey, there is still some way to go. I believe we are seeing fewer but larger claims, and a much more proactive rather than reactive approach to claims. Customers are demanding more and their expectations are higher. Technology is offering us more opportunities to reach those expectations, but we need to remember that the human interact is always essential when responding to a claim, so technology cannot become a replacement for that critical component.

MIM: Are there ways that insurers can collaborate better and share data?

DG: Let me share a motif with you. When Cockermouth was flooded in 2009, there were a few small shopkeepers with flooded premises. I wanted to get De Boer, a company that supplied temporary buildings, to put up a market hall so that all of the shopkeepers in the town could take a stall and could continue to be profitable amid disaster. However, economically, each shopkeeper could not afford the cost of the temporary building, but if they had grouped together and everyone had contributed to the funding of the market hall then it could have been feasible. The problem was that when you have a range of different insurers offering different levels of cover to the shopkeepers, it became impossible to coordinate 20-30 different policy holders and therefore that wasn’t an idea that we could go ahead with.

There are situations, such as the example above, where loss could be mitigated to the benefit of all, and it isn’t that there is a lack of willing, it is just that there isn’t a mechanism to do it.

Could we do better? Yes. If we could come up with a solution for better collaboration, particularly in an area like wide area damage, it would mitigate loss at a time of crisis.

MIM: Is there a danger of the claims process getting too impersonal?

DG: The first 48 hours of a claim are critical, but the most important element for the loss adjuster is to win the confidence of the policy holder because the policy holder is not going to spend money if they are concerned whether they will get it back. Trust is absolutely essential. People talk about expectations and if we are giving the policy holders the impression or the expectation that everything should be covered, then that is a very dangerous position to be in.

Damian Glynn

is Head of Financial Risks at Sedgwick.

You can find the PDF version of ‘Challenges Highlighted by Claims Experience: Business Interruption Policy Wordings’ here: https://www.socp.org.uk/learning/learning-contenthub/articles/business-interruption-policy-wordings/82752

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HGV estimating

- managing client expectations You could be forgiven for thinking that HGV accident repairs is clouded in mystery and is something of a dark art. However, to fully understand the complexities of HGV estimating and repairs and to manage client expectations regarding loss of use, itâ&#x20AC;&#x2122;s important for insurers to appreciate that the processes are quite different from those of cars and vans. Neville Lidford, M.I.M.I., M.F.I.E.A., A.Inst.A.E.A., Director of Engineering and Operations at Selsia gives his thoughts.

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ery few trucks are built by one manufacturer. The truck will be known as something like a ‘Mercedes Benz Actros Refrigerated Box’. This would mean that the chassis cab, which is the chassis, engine, transmission, suspension and driver’s cab are all built by Mercedes Benz.

The chassis cab would then go to a body builder who would build the insulated box to bolt on to the chassis. The body builder will not, however, manufacture all of the components to the body and they would buy in the refrigeration unit and controls as a minimum. If the vehicle requires a tail lift, this will have to be supplied by another manufacturer. The same applies to other body types which can range from a straight forward box body, through tippers, tankers to car transporters. All these body types will have various bought in components to make up the whole body from extrusions, cappings, roller shutters, through hydraulic systems, including cranes and tipping rams, to racking systems. In addition, other variations on the final commercial vehicle can include parts such as underrun bars, cab air deflectors and low spray mudguards.

There are several hundred companies who build bodies in the UK and many more all over Europe.

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Commercial vehicle operators normally specify the design of the body to suit their business activities and the variations are endless. Given all of the permutations and variations in specifications, it can be seen that there will not be many ‘standard’ commercial vehicles on the road. This is the fundamental difference which has a significant effect on the accident repair process between cars and trucks.

Given all of the permutations and variations in specifications, it can be seen that there will not be many ‘standard’ commercial vehicles on the road. This is the fundamental difference which has a significant effect on the accident repair process between cars and trucks

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The differences in the repair process between cars and trucks are very significant and it’s important to understand the differences in order to manage expectations So let us look at estimating accident damage to commercial vehicles For cars and light vans, estimating systems, like GT Estimate, create estimates from a database of parts with prices, times for remove and refit, times for replacing and times for painting if required. This makes the car repairer’s job of estimating easier than it is for commercial vehicle repairers.

For commercial vehicles, there is a limited number of models covered by these estimating systems and they are restricted to the chassis cab components and no data exists for the body which bolts to the chassis cab. This means that there is no clicking on a graphic showing a door and getting an estimate as none of that data is available.

For operation times, truck repairers therefore have to use their experience and knowledge of the construction of the body. They can’t simply use the time they used last time for a similar operation as manufacturers use differing methods in the construction of their bodies, so replacing components could be three times as long from one builder to another.

The repairer then has to provide parts prices in order to complete an estimate.

Again, they cannot use prices for similar parts from another body builder as the variations on similar parts can be very large. So the repairer has to ask the body builder for parts prices which isn’t as easy as it sounds. The repairer is then dependent on the suppliers’ speed of response in order to complete the estimate. Some of these are large companies and some build very few bodies so there is not always an established parts supply chain. Obtaining

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parts prices can be a long drawn out process taking several days. Furthermore, some of the components required may not be obtainable from the body builder but from the original supplier of parts such as tail lifts and roller shutters and these will have to be priced up from those manufacturers. Additional complications occur when the original manufacturer is no longer in business. This would require the local agent going to the company who purchased the rights to the design, who hopefully has the specification drawings, and then obtaining the parts prices.

Carrying out the repair Once authority has been granted by the insurer or client, the parts will be ordered by the repairer. This will normally be straightforward for chassis cab components as there are less than ten manufacturers selling chassis cabs in any numbers, within the UK. This does result in a reasonable parts supply although, with the vast majority being built elsewhere, if there is no UK stock there can be extensive delays. The position is not the same for body parts and third party components.

These have to be ordered from the body builder. Some parts are generic and can be ordered from a general supplier, which often means the body builder raises a pro forma invoice which the repairer has to settle before the parts are made and dispatched. The word ‘made’ slipped into the last sentence which was not a mistake.

Because of the huge number of body builders, and their range, not many parts are retained in stock and this often means making the parts to order. Wherever possible, generic parts, which are readily available, will be used by repairers in order to speed up the repair process.

Clearly there are many problems in repairing trucks due to their sheer size.

In addition, the skills and investment in specialist chassis alignment, cab jigs,

heavy pulling and wheel alignment equipment as well as hard standing areas and commercial vehicle spray booths cannot be underestimated. Even special bodied vans are generally higher than production vans so require larger spray booths, ladders and trestles to gain access.

Many parts are also very heavy so require more than one person to position them on the vehicle. All of the equipment for jacking and pulling needs to be bigger and stronger. Finally, obtaining the correct livery is an important part of the repair and as well as obtaining it, additional drying time is required for paint as all of the solvents have to be out of the paint prior to livery fitting to avoid paint problems at de-fleet time.

The differences in the repair process between cars and trucks are very significant and it’s important to understand the differences in order to manage expectations. There is no doubt however that the appointment of a centrally managed accident repair organisation with specialist commercial vehicle repairers who live in this world, will help to ensure this process is effectively carried out as quickly as possible and that heavy specialist vehicles are repaired safely and back on the road in the shortest possible time.

Neville Lidford, M.I.M.I., M.F.I.E.A., A.Inst.A.E.A., is Director of Engineering and Operations at Selsia.

Award winning centrally managed accident repairs for all types of vehicles Voted the UKâ&#x20AC;&#x2122;s favourite accident management company by professional repairers

0845 468 6800 info@selsia-vac.co.uk selsia-vac.co.uk Safely back on the road.

F E AT U R E S

Discussing

data-driven claims solutions and mobility claims in the motor repair and insurance sectors

Insurers are challenged to consistently offer a faster, frictionless experience for their claims customers with limited IT budgets and legacy systems. Although there have been breakthroughs in streamlining the life of a claim, there’s still room for progress. Olly Savage, Business Development Director at Verisk Claims, explains how insurers can introduce data led solutions to achieve truly end-to-end, ‘right touch’ claims.

As insurers push ahead with digital transformation initiatives and look to introduce greater automation, claims handling is still ripe for digital innovation

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F E AT U R E S he industry feels the pain of a major shift in customer expectations, particularly among today’s ‘digital natives’, who expect quick payment to cover their losses. On the other hand, the insurer’s underlying business goals have remained very similar, namely seeking to improve the bottom line with time and resource savings – without compromising on the customer experience or making themselves vulnerable to claims leakage through fraud.

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Balancing insurer pain points with customer expectations Insurers know agile automation technology will enable a fast, frictionless and engaging claims experience, but hurdles remain.

Subrogation, personal injury and mobility represent a significant proportion of manual touch points in the claim lifecycle, and key areas where insurers can improve their bottom line.

Automation reaches new heights Introducing a platform with a high degree of automation in the claims process shifts the burden of the many repetitive elements away from claim handlers. This reduces the number of handler touchpoints, allowing employees to focus on the more important intervention and decision-making required for more challenging claims.

These platforms also importantly incorporate predictive analytics and granular rules-based scoring technology for greater transparency and consistency – providing handlers with detailed visibility of settlement progress.

Tailor-made deployments Automation currently offers insurers the unique opportunity to quickly deliver on the vision of end-to-end right touch claims processing. But to ensure success, insurers must select solutions that can be tailored to the unique demands of their claims environment. No one solution fits all, so it is vital to select an innovation partner that understands the workings of an individual insurer’s business operations and how to effectively add value.

No need to ‘Rip and Replace’ For insurers struggling with limited IT spend for transformation projects, they may be reluctant to retire legacy systems that have seen significant investment, maintenance and customisation over the course of many years.

This need not be the case. Platforms in the claims space need to be heavily customisable, and effectively sit on top of existing claims systems through simple, smooth integrations with all interested parties – and even independent third parties in order to enhance data validation.

This also solves the legacy issue that many insurers experience – whether this is struggling to maintain ageing IT systems, modifying them in line with evolving business and industry requirements, or retaining a competitive advantage in the face of more agile, techsavvy industry rivals.

Where next?

As insurers push ahead with digital transformation initiatives and look to introduce greater automation, claims handling is still ripe for digital innovation. Alternative dispute resolution such as arbitration, and the payment process are logical next steps for automation.

We are already seeing early success in automating the arbitration stage for subrogation claims, achieving an average recovery lifecycle reduction of 160 days on claims involving liability disputes.

We have also seen the added benefit of contributing to a 20% reduction in litigation between insurer participants.

As data-driven transformation continues to disrupt the insurance industry, insurers should look to begin evaluating the benefits and opportunities that lie with introducing agile, end-to-end technology into their claims operations.

For example, the platform can have built in selective automation capabilities to help insurers control the types and severity of claims they wish to be settled exclusively through an automated process. Claims that fall outside of these parameters can then be streamlined to provide handlers with tools such as document preparation and exchange for settlement negotiations and resolution.

Reduce manual touch points and accelerate lifecycles through greater automation The benefits are clear. Introducing automation into a claim is proven to deliver time and cost efficiencies contributing greatly to lower overall claims spend and reduced leakage, making insurers more competitive.

Take the Verisk claims management platform, verify.

This platform serves over 75% of the market by GWP and looking at this data, we can see that 65% of subrogation claims are now automated. Central to this success has been the reduction in manual touch points – from an average of 50 touches per claim down to 5 – and the introduction of a fully automated, liability arbitration process.

Olly Savage is the Sales and Business Development Director at Verisk Claims.

No one solution fits all, so it is vital to select an innovation partner that understands the workings of an individual insurer’s business operations and how to effectively add value

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Invoice payment and recoveries – a complete digital solution Manage the claims process from invoicing to recoveries via a web based solution suite that enables the exchange of data across Insurers, Repairers and Credit Hire Organisations. Ensuring faster claims resolution, enhancing the customer experience at every touch point.

Our award winning solutions are already delivering:

£ 85% of all claims tasks/functions can be managed automatically (zero touch) through the customer’s core claim systems

Reducing claim recovery touch points from 5 to 1

Find out more:

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Saving time by cutting the claims lifecycle by 35%

Significant reduction in aged debt

Women in repair

Introducing our ‘Women in repair’ feature is Julie Eley CMIOSH MIMI, Operations Director for Quantum Technical, who discusses the importance of getting more women involved in the sector but also celebrating the fantastic women that are currently a part of the industry and why they are such an inspiration! #girlpower I have met some amazing women within this industry and I think the body repair industry has changed massively in the time I’ve been in it. More roles are opening up to women, but also women are becoming more confident about what they can do. This is one of the positive things that social media brings. Women are pushing themselves forward and saying ‘I can do that!’

Having spent many years in the Territorial Army, I learned new skills but I was also honest about what I found difficult. I was one of a handful of women, but we were expected to do everything that the men could do, and probably a bit more, to earn respect and become a valued part of the team. I believed I could do it and I did.

I want to learn from and be inspired by both men and women, I want to be the best version of myself I can be. The only way I can do this is to pick the good things, whether these are traits, pearls of wisdom or tips from others and apply them to my own situation. Everyone has something new to learn, the minute you think you can’t learn anymore you have become complacent.

Attracting new talent to the industry is an absolute must and it shouldn’t be gender specific, we don’t want to be divisive, it’s about skills, qualities, experience and knowledge, and what’s key here is matching people with people, and people with the right roles.

We asked Julie Eley CMIOSH MIMI, Quantum Technical and Nicola Mascard, Operations Director, Audatex UK, who are forging a path in this traditionally male dominated marketplace, to answer some questions about the challenges and opportunities facing women in the repair industry.

Q

What advice would you give to women who are looking to progress into senior level positions in the industry?

Julie Eley: I would always advocate that you step out of your comfort zone (within reason) and stretch yourself but not to make yourself fail. Naturally, some women are less likely to do this due to confidence and self-belief issues, so it’s about surrounding yourself with positive people, those with a can do attitude.

If you lack in confidence, find someone who is confident, not

We want to help celebrate success, help women realise their full potential and attract many more into what is a fantastic industry.

The only way we can do this is with your help… (See below for an idea) #girlpower (I would like to set up a social media platform with some female friends and hopefully with some help from you, to share inspirational stories and quotes. Get in touch and let me know what you think!).

For those women working in the bodyshop and repair industry, I would encourage them to have determination and belief in their abilities to progress into a senior role, trust their instincts, use their voices and when the time is right grab every opportunity Nicola Mascard, Audatex UK

arrogant though, watch them, get tips, see how people react to them. Find role models, male and female and pick out the things that they are good at or you like about them and learn from them.

The main thing is to believe in yourself, take compliments. I wasn’t good at this, but it helps you see how others see you, it’s a free confidence boost. If you can’t do something right now, learn how to do it, you don’t need to know how to do everything if you have the right people around you. I ran bodyshops but I never repaired a car.

Start planning and picture what a successful or a happier you looks like in 6 months, a year, etc., and start writing down what I call “smilestones”, targets which make you smile when you’ve achieved them. Always have a purpose for everything you do, if you can’t think of one it’s not worth doing.

My role models aren’t all women or who work in the industry. I choose them for a particular trait like grit and determination, being an entrepreneur, building a successful business despite adversity

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Remember it’s not all about gender, it’s about you bringing something unique to a team of people

Julie Eley,

Quantum Technical

and major setbacks, all the things that I might need inspiration and help with. A role model for me isn’t just someone who does something well, it someone who makes a difference to me or others.

Don’t be intimidated by anyone who you perceive is better than you, the only thing that counts here is you.

Stay humble -this opens you up to inspirational people, people who are a better version of who you want to be. Learn from everything, positive or negative, and always have some reflection time at the end of the day. Think about the lessons learned and know tomorrow you will wake up that better version of yourself.

Don’t be too hard on yourself.

Remember it’s not all about gender, it’s about you bringing something unique to a team of people, some of who will be very different than you, but this is where diversity counts and you have your part to play.

Nicola Mascard: My experience of progressing and now working at a senior level within Audatex has been shaped by taking the opportunities available to me when the time was right for me. My advice to other women is to recognise their own skills and qualities, don’t think I can’t do something, think about how you can achieve it. Remember you don’t have to have all the skills on day1 but by day90 you could have, and we all grow into roles.

If you are lucky enough to work within a supportive environment that offers training/coaching grab it at every opportunity.

For myself, I have never felt or considered that I have been treated any differently from male colleagues, I rate myself against the qualities I aspire to have and those I need to lead my teams and

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to contribute to the senior role I have within Audatex. Understand what your strengths are and focus and build on these, don’t think you have to be something you are not. Everyone has areas that they need to improve on, but these should be to make you the best version of yourself, not a copy of others around you or what the perceived norm has been.

The best organisations I have worked in are where there is recognition that a diverse workforce produces the best results and that people need to be treated individually to allow them to contribute fully. As a senior manager and throughout my career, listening to all voices, not just the loudest has been a foundation of my success.

Women and men typically take a different path through their careers, however no matter what the industry, statistics show that women are underrepresented at a senior level. For those women working in the bodyshop and repair industry, I would encourage them to have determination and belief in their abilities to progress into a senior role, trust their instincts, use their voices and when the time is right grab every opportunity.

Q

How can the industry’s journey with D&I continue to progress?

NM: I have met some amazing women leaders within the vehicle repair industry, but there is still a norm of a very male dominated workforce in all areas of the industry. More women are starting to be encouraged to join the trade, and this will continue to improve the balance as schools and colleges highlight the roles, through the work of organisations like Autoraise. I also think that as the technology around vehicles changes, and the automotive industry continues to have focus within the media, that the reflection on the whole industry will make it a more attractive.

Nicola Mascard,

Julie Eley CMIOSH MIMI,

Audatex UK

Quantum Technical

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10

MINUTES

WITH...

10 mins with...

Paul Sykes

Q A

Has the industry changed since you started working in it?

I have been in the industry for 25 years and would say that there have been two standout changes during that time. Firstly, we experienced significant standardisation in the approach taken to process claims and assess damage, then came the digitisation which significantly

market is generally ahead of the curve.

From experience, most countries around the world can learn from the UK and, apart from the odd dysfunctional process here and there, this is a very positive global dynamic.

Q

Who inspires you and why?

much younger at the beginning of my career as a leader, and the one thing he taught me was to recruit well. Surround yourself with people who are better than you. The best leaders are those that select the best people. One of the biggest, and most common, failings of any leader is to recruit poorly. Don’t be proud, surround yourself with people that are far better than you would be in their position!

The UK has developed into the most mature and complex insurance market in the world, whether we’re talking about pricing and underwriting or the claims process, our market is generally ahead of the curve

reduced processing time. These elements combined have led to greater efficiencies across the insurance industry and its supply chain.

Q A

What has been the key positive or negative impact of change in the market?

The UK has developed into the most mature and complex insurance market in the world, whether we’re talking about pricing and underwriting or the claims process, our

A

My children are the ones who inspire me. It is amazing to watch them grow up and I’m so proud of them both, they genuinely inspire me to be the best person I can, both at home and at work.

Q A

Have you had/got a mentor? If so, what was the most valuable piece of advice they gave you?

I have had a few mentors over the years, but the one that comes to mind is an old boss of mine. I was

If you were not in your current position, what would you be doing?

Q

A

The first thing that comes to mind is that I have always wanted to own and run my own boutique hotel. I have always been obsessed with top quality service and the high end hotel industry is the perfect example of this.

Paul Sykes is the Regional Managing Director at ControlExpert UK Ltd.

The best leaders are those that select the best people

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