DWF won the Data, Knowledge and Intelligence category at the 2019 FT Innovative Lawyers Awards Europe in recognition of our use of data analytics to help insurers mitigate the effects of adverse claims and behaviours.
Insurance companies face thousands of fraudulent and exaggerated claims every year. They have developed reasonably effective 'Know Your Opponent' strategies to tackle adverse behaviours by claimant solicitors, including fraud and claims farming, which have seen some success. However they related to a number of individual solicitors and therefore did not cover the full claims market.
They were cumbersome to use for claims handlers, were difficult to keep updated to reflect changes in behaviour by the targeted solicitors and did not take into account new entrants to the claimant solicitor market. Furthermore, all claims presented by an individual claimant solicitor would not all behave in the same way, diluting the effectiveness of insurers’ strategies.
This resulted in insurers still finding it difficult to identify the likely behaviours of any given claim at the outset, leading to new claims being routed to claims handlers lacking the relevant, specific skills to tackle those adverse behaviours.
Following extensive research into the motor market, DWF theorised that large cohorts of motor claims were likely to behave in very similar ways based on the route by which the solicitor initially procured the claimant. Our theory held that there were three main routes available to claimant solicitors that accounted for the vast majority of motor claims and that large groups of claims procured via the same route, irrespective of which claimant solicitor was presenting the claim, would behave very similarly. The theory was borne out when we undertook analysis of our motor claims data.
This fully solved the problems with individual Know Your Opponent strategies by simplifying many hundreds of different strategies into strategies around behaviour rather than the individual opponent, and also covering the majority of the motor claims market
This innovative collaboration between our lawyers, strategists and data analysts predicts the likely behaviours of any new claim at the initiation stage based on its specific case features. Insurers can use this to inform individual handlers decision making, or in some cases they have organised their target operating models so that different routes to market are handled in ring-fenced teams.
It has given us an insight into claimant solicitors' business models that is unprecedented in the industry and which allowed us to predict their next move.
The initiative has delivered efficiency savings to our clients by routing the right claims to the right handling skillsets causing less friction in claims handling, and therefore, time and cost savings.
The initiative is largely 'future-proof' in that it remains fully usable in the faces of legislative reform and evolving claimant business models.
Ultimately, the initiative represents a legal solution, and it is within the development and deployment of the appropriate legal counter-strategies that our lawyers have delivered the most value.