The short-term disability (STD) claims process presents significant challenges for both carriers and benefits administrators. These inefficiencies primarily stem from reliance on outdated, manual processes like live calls, physical forms, and antiquated methods for capturing necessary documentation. Such approaches are not only resource-intensive but also create frustrating experiences for employees and employers alike. With client satisfaction and retention becoming ever more crucial, carriers are increasingly turning to new technologies to resolve these bottlenecks, as customer experience specialists Ushur explain.
Traditional methods for handling STD claims require a high level of manual intervention. This involves tasks such as completing forms, verifying documentation, and making follow-up calls.
EY’s 2023 report revealed that each manual transaction without self-service technology costs approximately $4.78, a number that adds up significantly across the multiple steps required in claims processing.
Further exacerbating this issue are the frequent outbound calls necessary to gather missing information. Some carriers reportedly make as many as six calls per claim to track down required details, which contributes to inefficiencies.
Simply Insurance noted that around 40% of short-term disability claims are denied due to incomplete or incorrect applications, often referred to as not in good order (NIGO) cases.
For employees already dealing with the stress of taking a leave of absence, inefficiencies in the STD process lead to frustration.
Delays in claim decisions, repetitive requests for information, and poor transparency all contribute to a negative experience, reducing overall satisfaction. This can have significant consequences for insurers in a competitive marketplace, where superior customer service is a key differentiator.
AI and automation: The game-changer for short-term disability claims
AI and automation are proving to be the solution carriers need to overhaul their STD claims process. Automating routine tasks like data entry, document collection, and status updates drastically reduces the need for time-consuming manual follow-ups.
This not only speeds up the claims journey but also enhances transparency, enabling claimants to track the status of their claims in real time. Proactive updates, such as return-to-work notifications, further improve the claimant experience by minimising delays and reducing friction.
Lower call volumes and operational savings
One of the most noticeable impacts of AI in this space is the reduction of outbound calls. Insurers traditionally rely on calls to gather data, address queries, and update claimants.
However, AI-powered platforms like Ushur’s CXA Platform have enabled some carriers to reduce their outbound calls by 42%.
AI can handle repetitive tasks, deliver instant responses, and collect critical information from claimants without the need for human agents.
This reduces operational costs and frees up staff to handle more complex cases, improving overall efficiency and policyholder satisfaction.
Enhanced customer support and satisfaction
AI’s impact extends beyond operational efficiency; it also enhances customer satisfaction. By offering self-service features, such as e-signatures and real-time updates, carriers empower claimants to manage their claims with ease, reducing friction points.
Automated case and care management outreach further supports employees during their recovery and helps them return to work more quickly.
These streamlined processes create a smoother, more customer-focused experience, critical in a highly competitive market.
Scalability and cost efficiency
AI also provides insurers with much-needed scalability and cost-saving benefits. For large carriers handling thousands of claims, AI offers the ability to manage high volumes seamlessly.
Automated systems enable insurers to engage with claimants instantly, cutting down on manual paperwork and reducing turnaround times.
Some carriers using Ushur’s platform have reported significantly faster processing times, scaling operations in just weeks while reducing costs and improving customer satisfaction.
Inside Ushur’s CXA Platform
Many insurers have faced challenges when it comes to managing absence engagement, particularly with manual processes that cause delays and frustration.
Ushur’s Absence Management Automation solution addresses these challenges by automating data collection through SMS interactions and integrating seamlessly with backend systems.
Claimants can easily provide key details like return-to-work dates, reducing the need for multiple calls and allowing live agents to focus on more complex issues.
The results are clear: client engagement rates have soared, with 85% of claimants responding promptly, 50% within five minutes, and 90% within an hour.
This rapid engagement reduces call volumes and slashes processing times from weeks to mere hours. Customers using Ushur’s platform report substantial operational efficiency and cost savings by automating thousands of messages monthly and engaging large claimant bases effortlessly.
The future of short-term disability claims management
AI and automation are no longer optional but necessary tools for insurers looking to streamline absence management and stand out in a competitive landscape.
By automating routine tasks, lowering call volumes, and improving customer experience, solutions like Ushur’s AI-driven platform turn a previously complex and time-consuming process into an efficient, transparent journey.
As the insurance sector continues to evolve, those who adopt AI will be better positioned to meet policyholders’ growing expectations while reducing operational costs and achieving better business outcomes.
Read the full blog from Ushur here.
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