Finansinspektionen, Sweden’s financial supervisory authority, has criticized the insurance industry for its handling of personal claims for several years.  Mainly due to the many complaints and the lack of trust for the industry from the consumers. The insurance industry was quick to respond and these measures seem to have had the intended effect, at least according to Finansinspektionen in a recent memorandum put forth to the Government. However, we find that the industry is still severely lagging behind and many challenges are still unaddressed. We urge the industry to speed up especially when it comes to digitization.

In May of 2016, Finansinspektionen was given the Swedish Government’s assignment to analyze claims settlements in personal injuries. The following year, they published their report criticizing the insurance industry and pointing out some areas for improvement. Finansinspektionen finds that the self-imposed actions taken by the industry seem to have had an effect. Among other things, the industry has focused on education, on improved setup and better communication, with a type of language that is easier to understand in their medical assessments and also quality assurance.

But, we think that is far from enough. The fact that there are still significant inadequacies in claims handling and much potential is still untapped, much at the expense of the consumer.

– We are, of course, happy to hear about the improvements and the fact that personal claims are regaining trust from the consumers. However, from our standpoint, a lot still remains to be done, especially in quality assurance. There are still cases that are rather arbitrarily handled and, furthermore, the industry as a whole is far behind when it comes to digital transformation. It is as if they don’t quite see or possibly understand the potential and vast opportunities. For example, if you make use of structured data, 25% of all cases could be automated. That in turn would mean that they would not need to see a doctor, but instead, could get a wellfounded answer via AI.

In their memorandum, Finansinspektionen too points out the need for digital transformation and concludes that manual handling is still too extensive, causing long turnover times as a consequence. From the memo: ”As was mentioned before, the companies work continuously with system development. However, that is both time consuming as well as costly, which means that it may take some time before new and adjusted processes and set up that rests on system support are implemented”.

– It is our understanding that the insurance industry still has not fully realized the potential of and the need for digitization. That in turn means that they are not quite prepared to meet a new, evolving type of customer, the so called “digital natives”, who have quite different expectations from their insurance company. Today’s customer – and the customer of tomorrow even more so – expect to be involved and turnover time to be relatively fast. We as an industry need to step up and take a joint responsibility. That does not necessarily mean that each and every company should develop their own system solutions, on the contrary, much can be said for centralized solutions that can be shared by many.

Roine Gabrielsson CEO