06 Jan What is First Notice of Loss & Why is it Important to Insurers?
In the event of a Theft, Loss or Damage to insured assets, people contact Insurance Providers to report the incident. FNOL (First Notice of Loss/First Notification of Loss) is the first and foremost Report made to an Insurance Provider regarding Theft, Loss or Damage. FNOL call centers operate 365 days and round the clock, ensuring that policyholders get a chance to quickly report the incident and also ensures that insurance companies get accurate claim loss data at the right time. In this article we will learn about FNOL concept and how FNOL serves as a critical factor towards improving Operational Agility, Client Satisfaction and Retention.
Let us discuss a scenario which would help you better understand the FNOL Concept:
The Insurance Claims Lifecycle consists of a series of processes starting from the time the insurer gets the alert to when the settlement is made. Obviously, the Claims Lifecycle starts with First Notice of Loss (FNOL) as the initial step. Imagine an automobile crash, the insurance company immediately gets a notification (FNOL) of this event. The insurance adjuster investigates on the severity of the damage to the asset and based on relevant reports determines the settlement amount.
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Why is FNOL important to Insurers?
Being able to successfully claim insurance is always the first source of consolation during any unfortunate event related to damage of precious assets. An opportunity to get immediate help from the Insurance company can drastically create an impact here. Highly specific and quicker loss notification often results in enhanced and rapid claims approval. Insurtech companies which diligently creates apps and tools and implement intelligent solutions ensures that businesses and clients enjoy reduced claim costs, increased efficiency, accuracy and consistency on a continued basis.
First Notice of Loss is a unique process which fosters customer trust, especially when they get a quick and reliable response from the Insurer based on rapid notification of event. FNOL provides a great platform for insurers to showcase their customer centric attitude and this would definitely improve customer loyalty and satisfaction. Moreover, modern FNOL technology helps in massive increase in claims intake volume through digital channels and at the same time optimizes the unit cost for non-digital channels.
Telematics is a famous technology which is crucial in FNOL process. Telematics box installed in the car sends immediate alerts to the insurer whenever there is an accident. This has built-in GPS technology and accurately records and relays all details including date, time, location of the incident. This information is treated as FNOL by the insurer and the adjuster is confident that it is accurate and consistent with similar records of events. Telematics is also efficient in verifying & preventing chances of many fraudulent claims.
Insurers can make drastic reduction in costs and improve claim settlement time by implementing Digital FNOL Solutions. This leverages Machine Learning, Artificial Intelligence and Robotic Process Automation along with integrated Insurtech solution providers capabilities to ensure fast, secure and swift claims validation, automated damage estimation and fool-proof fraud detection capabilities.
To summarize, FNOL is an inevitable touchpoint which opens the door to lot many improvement opportunities and sales advantages for Insurance companies. Huge amounts of data is gathered through FNOL which is put into deeper analysis and the outcomes are enormous which includes Quicker Claims Settlement, Improved loss Ratio, Heightened agility and operational efficiency, and Reduced claim in-take expenses.
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