Advertising feature: Property claims - building supply chain resilience in a crisis

A nationwide shortage of building materials, combined with overseas delays and a lack of available skilled labour, is causing havoc throughout the UK construction sector. But the implications aren’t just on the building trade — it’s affecting the insurance industry, too.

Property claims are being faced with countless issues, from increased lead times due to the lack of available supplies — which need to be factored into building projects — right through to big leaps in pricing for key materials such as timber; these are all elements which directly impact invoicing and cash flow.

When combined with the fallout from the pandemic, the shortage of heavy goods vehicle drivers, Brexit and changing regulations, a ripple effect is moving through the supply chain.

The consequences of this are gaps in the performance of service level agreements and project delays which are driving up the cost of insurance claims.

This has brought the issue of supply chain resilience to the forefront, and with volatility expected to continue, the current state of the market is throwing the long-term feasibility of global supply chains and production systems into question.

There is, however, an opportunity amid this crisis for participants in the whole supply chain to consider how to do things faster and better. The key is being open to what’s possible.

Out of adversity comes opportunity

This sprawling situation needs technology that brings these disparate sets of data — from material updates, progress times, invoices, customer feedback and even weather reports — together in one place to enable a more meaningful conversation and to empower trend analysis and data-driven decision making.

The pandemic has, in many respects, expanded customer appetite to do more things digitally, and for the insurance industry, this is a positive step forward. With claims, for example, there is now greater acceptance and adoption of virtual assessments, meaning fewer on-site visits. This is not only saving time (and therefore costs), but it is encouraging increased productivity, too.

There is also a greater use of online portals where, for example, policyholders are able to upload photos and videos to document claims damage directly into an online portal using any compatible connected device, at any time. This allows images to be shared almost instantly with claims handlers and participants, ultimately speeding up the claims process. By using such technology systems, insurers are able to provide clients with a continued, open dialogue which in turn fosters a transparent and trusted relationship.

Collaboration is key

Throughout the industry, there is a strong demand for digital claims technology that connects the entire supply chain ecosystem to expedite a claim’s scoping, adjustment and pay-out.

To achieve this, forward-thinking insurers are already using technology to help build supplier ecosystems; not only does this allow them to collaborate more effectively and efficiently, but it provides them with a platform for automated validation processes and accurate, real-time data.

These elements present huge opportunities, from generating straight-through processing of supplier payments (which in turn significantly reduces the administration burden of processing payments as well as improving cash flow for contractors), right through to providing a complete overview of the whole claims journey.

This single source of oversight helps supply chain participants understand, anticipate and mitigate disruption. Collaborating in this way reduces costly and inefficient duplication of effort, lowering the risk of manual errors — all while providing an automated audit chain for governance and compliance.

Such centralised data sets can also help dramatically speed up due diligence processes — such as the approval of a new supplier’s invoice — which can lead to excessive frictional costs if not completed in a timely manner.

Efficient claims management

Providing this shared, common view of data and performance is empowering collaboration across complex supply chains — particularly in enabling faster payments and efficient treatment of claims.

Insurers are able to use data to settle straightforward claims swiftly and efficiently, quickly reducing uncertainty around costs.

Having centralised data at their fingertips also helps insurers to triage claims effectively, helping them to identify those which are more complex and therefore require different work streams, such as the addition of a loss adjuster. Workflows can also be optimised with far fewer frictional touches — even for complex claims.

Improving supply chain quality

An accurate single version of the data set also facilitates better informed discussions for capacity planning throughout the supply chain, from ordering the correct volume of materials at the right time (both helping to reduce waste and account for disruptions), right through to helping optimise labour resource deployment. It also furthers shared intelligence to highlight bottlenecks — which can be critical to successful projects.

This clear flow of information provides greater visibility for forward planning, helping everyone in the supply chain anticipate volatility and changes, to spot trends before they become challenges and to be more agile in addressing them. Client expectations can therefore be managed, and potential problems can be mitigated when a bottleneck is foreseen.

Centralising data in this way can also help insurers better understand the quality of a supplier and even encourage other suppliers to become more agile which in turn represents a better risk profile for the supply chain. 

Above and beyond this, there is also a process of continuous improvement whereby best practices are shared to help all parties in the supply chain work more effectively. We have seen, for example, scenarios where shared data has allowed supply chain participants to explore better ways of working, including adopting a repair versus replace methodology.

Helping all parties make the process work better

We are seeing strong evidence of this at CoreLogic — with clients, intermediaries and suppliers increasingly leveraging our systems and integrations to provide richer, more granular data on costs, lifecycles and customers.

Supply chain participants which have invested digitally are already seeing the benefits, as they are able to be far more agile than their traditional counterparts.

Integrating claims workflow and management platforms into their existing operations allow loss adjusters, surveyors, network providers and supply chain vendors to access real-time collaboration tools to quickly and easily complete site reports, generate accurate estimates and improve efficiencies that help shorten the claims process.

Supply chain volatility

The ripple effect of disruption along the supply chain, combined with the acceleration of demand as a result of the ongoing pandemic, will no doubt continue to create challenges for the industry. Now, more than ever, an appreciation of a data-driven, single view of claim profiles is critical, not only to help understand any potential impacts but to bring focus on outliers more quickly and effectively.

The ability to proactively share information and make data-driven decisions based on real-time information across the supply chain will continue to help our industry remain resilient and fit for purpose, both now and in the future.

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