A Tale of Two Cities

Since A Tale of Two Cities, the 1859 novel by Charles Dickens, is in the public domain, we borrowed the title for this post.

Unlike the novel, which takes place in London and Paris, our story takes place in Baked, Alaska. We called Albert Murfwhiffle, the municipal risk manager for the city of Baked, after hearing about a snow-plowing accident that resulted in multiple claims. We recorded the conversation, then sent the recoding out for transcription because we didn’t think anyone would believe what happened.

This version of the transcript has been edited for brevity and clarity. Al is represented as AM. We’re represented as CE (claims expert, of course):

CE: Good morning Mr. Murwhiffle. Do you have a few minutes to speak with us.

AM: Well, I guess I can spare a few. I gotta get over to the hospital to see Clem. He was in an accident with one o’ them snowplows, ya know.

CE: Yes. We heard about that. We weren’t able to get all the details. So, we thought we’d call and ask you about it.

AM: Yeah. Clem never seen that moose.

CE: Moose?!

AM: Yep. The durn thin’ jumped right up on the hood o’ Clem’s truck and did some kind of Merengue or somethin’.

CE: The moose was dancing on the hood?

AM: Right before he poked Clem in the eye with an antler, he was. Busted the windshield right out.

CE: Is Clem alright?

AM: He’s a little banged up, but he’ll be okay. His truck is totaled, though.

CE: Totaled?!

AM: Right you are. With only one good eye, he couldn’t see past the moose on the hood, and he drove off a bridge.

CE: And he’s only a little banged up?

AM: He was lucky. His airbag deployed, and he was wearing 10 pairs o’ long johns. Cushioned the impact pretty good.

CE: That sounds like a property damage claim, a personal injury claim, and a veterinary claim.

AM: ‘At’s about right.

CE: How are you managing all that?

AM: Mildred in my office has it all diagrammed out on a BOC.

CE: BOC?

AM: A big ol’ chart. Right there on the wall, ya know.

CE: Have you ever heard of Cloud Claims?

AM: Is that anything like weather insurance? We could sure use some ‘o that with all the snow up here.

CE: No. It’s an incident-based claims system that would let Mildred track and manage every claim related to Clem’s accident with her keyboard.

AM: No more BOC?

CE: No more BOC.

AM: Where do I sign?

Choose Cloud Claims For An Incident-Based Approach To Claims Management

We’re happy to report Baked, Alaska is now using Cloud Claims. Clem’s out of the hospital. The insurance company replaced his truck. The city got rid of Mildred’s BOC. And the moose has refused to come out of the house since the accident.

Albert Murfwhiffle is now living in Freemish, Alaska, working for Mildred.

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How High is High Tech?

In September of last year, McKinsey & Company published a report called, How top tech trends will transform insurance. This excerpt about claims technology caught our eye:

Technology trends have the potential to materially change some of the underlying inputs of insurance products and core functions … [allowing] carriers to more effectively manage risk and make use of complex customer data—a critical step in evolving to a “predict and prevent” model of insurance where data is shared more frequently between parties.

It’s actually quite amazing to think about how far we’ve come from paper applications and telephones as means of submitting claims and how quickly it happened. We’re not quite sure what McKinsey means by will transform, since software has been transforming insurance — particularly in claims — by helping companies of all sorts to submit claims, to manage risk, to analyze customer data, to identify risk trends, and to mitigate the risks posed by those trends.

But that’s okay. That’s not the part that really got us.

The Shifting Role Of Insurers

Later in the report, McKinsey wrote this:

The role of insurers may shift from claims to prevention, whereby they are best placed to identify and reduce risk by partnering with clients and using technology.

Whoa! It can be argued (as we did above) that software is already enabling insurers to play a more active role in mitigating risks. But actually shifting roles from claims indemnification to claims prevention? That’s a whole different kettle of fish.

McKinsey may prove to be correct. But for the moment, we’re not sure how software could predict the occurrence of risks well enough to preclude them. If we take into account the vagaries of human nature alone, it seems like a stretch. How, for example, in any given scenario, can we know Person A will do this, instead of that? Under what specific conditions is he likely to do one and not the other? How can we know?

We’re software developers. We believe in technology, of course. But we don’t want to get ahead of ourselves in predicting the omniscience of software, even the software we develop.

That doesn’t mean we sell ourselves short. But it does mean we wonder how high tech can go.

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