EvolutionIQ Has Been Awarded $21 Million To Automate The Processing Of Insurance Claims Processing With Artificial Intelligence
For insurers, processing claims on a massive scale is a demanding task; this complexity increases even further if the claims contain complicated underlying health issues. Insurance consumers in 2021 identified claim delays as the second most frequently reported complaint, trailing only unsatisfactory settlement offers, according to data compiled by the National Association of Insurance Commissioners.
The epidemic has placed additional strain on insurers, with a recent RGA survey finding that claims acceptance rates for permanent disability, critical illness, and long-term care have been particularly low over the last two years due to the epidemic. Even with lower claim requirements, the average time required to process claims climbed from 34 to 43 days prior to the pandemic, despite the reduction in claim standards.
Insurers such as Alan, Tractable, and Snapsheet are among a growing number of companies that are developing solutions to aid clients in managing the insurance claims process. The founder of EvolutionIQ, former Google AI executive Tomas Vykruta, is trying a different approach. The company interacts with insurers to review claimant data and third-party data in order to identify "high-opportunity" claims — specifically those involving bodily injury.
Brewer Lane Ventures led the $21 million Series A round, which also included FirstRound Capital, FirstMark Capital, Foundation Capital, Altai Ventures and Asymmetric Ventures as well as insurance carriers Reliance Standard Life, New York Life Ventures, Guardian Life, and Sedgwick. EvolutionIQ is a cloud-based analytics platform that helps companies improve their customer experience. Following minor seed and venture rounds in 2019 and 2020, the firm has raised a total of $26.1 million at a valuation of "north of" $150 million, bringing its total investment raised to $26.1 million at a valuation of "north of" $150 million.
Insurance experts may improve their claims processing by using insights gained from past claims data analysis, according to Vykruta, who wrote an email to TechCrunch about the company's services. The use of our decision intelligence technology allows claims teams to recover lost time while also streamlining operations." Our technology helps frontline operators to make better-informed decisions and focus their efforts on high-value claims by providing them with greater information. For managers, we are able to identify claims bottlenecks that require deeper investigation as well as those that can be resolved quickly — and then provide advice on how to resolve them."
Increasing the speed with which insurance claims are processed
Vykruta has had an impressive and long career in the information technology industry. He co-founded two video game firms, Antartica and Electrolab, and worked as a lead console software architect at Surreal Software, a Warner Bros. Interactive Entertainment subsidiary, before leaving to start his own company. Vykruta began his career at Microsoft in 2008 as a senior engineer in the advanced technology group, where he worked on the Xbox 360 game console's operating system software. The next year, he began working for Waymo, the autonomous car division of Google parent company Alphabet, as a machine learning engineer.
After spending the preceding decade of his professional career working on various Google machine learning projects, Vykruta joined up with Jonathan Lewin and Michael Saltzman, who was also one of the co-founders of on-campus furniture rental company Roomie, to form EvolutionIQ.
Despite the fact that applying artificial intelligence in a conventional sector can be challenging, Vykruta believes that this can be overcome by establishing 'explainable AI' systems in close partnership with users. According to the authors, "two systems are required: one that makes forecasts and another that presents the anticipated effects in [plain] English."
With EvolutionIQ, Vykruta, Lewin, and Saltzman set out to develop a platform that examines the history of claims — specifically health-related claims — from their inception to the present day in order to answer questions such as "Is this a claim on which we can take action?" and "Is the outcome going to be reasonable?" A claims adjuster who may have hundreds of cases open at any given time, according to Vykruta, can gain a better understanding of short- and long-term disability, workers' compensation, and property and casualty claims, as well as identify the most actionable opportunities and contextualize the results in light of new data and events, by utilizing EvolutionIQ.
It is incredibly difficult to assess the situations of [claimants], as their stories have been public knowledge for many years. It has been 15 or 20 years since some of these allegations were made. Their medical diagnoses could range between 30 and 40 in number. "The insurance industry is unable to provide a complete solution to this," Vykruta went on to say. "In the form of unjustified payments, this has resulted in astonishing waste," the report states. Normally, examiners will scan the final few dozen pages of notes and take no further action."
Based on its predictive algorithms, EvolutionIQ selects dozens of claims from among tens of thousands that are most likely to result in the best outcome for claimants, carriers, and customers. EvolutionIQ also analyzes open claims to lead personnel toward those who require further attention or new activities, such as those who may have fallen through the cracks in the insurance coverage.
"It is important for claims examiners to concentrate their efforts on the most significant incidents that affect customers and carriers. Vykruta noted that claims processing is "archaic and time-consuming," requiring examiners to "analyze enormous volumes of data or to evaluate data separately, despite the fact that each claim involves numerous individuals and systems." We designed a decision intelligence platform that acts as an AI-enabled copilot, detecting high-opportunity claims early in their lifecycle as well as situations that are most likely to be sent to adjusters, as a result.
Prospects for the market
According to Vykruta, the value proposition of EvolutionIQ is to reduce overpayments, waste, and claim durations that are longer than necessary. He claims that growing claim volumes have stretched insurance carriers' teams to their limits, and that solutions intended to scale management have actually exacerbated the problem by forcing examiners to make trade-offs that result in delayed decision-making and inaccuracies.
Hundreds of pages in a variety of forms (organized and unstructured) are constantly being added to claims that can take years to complete and many of them are worth six figures... The fact that we identify scenarios that do not require additional investigation and may be scheduled for settlement saves claims organizations a significant amount of time," Vykruta noted. In addition to working with the industry's premier disability insurers, property-casualty insurers, and third-party administrators, like Reliance Standard, Principal, Sun Life, Argo Group, Matrix Absence Management, and FullscopeRMS, we also engage with the following companies:
It goes without saying that AI is plagued with bias issues, and a growing body of evidence has proven how allegedly "fair" insurance algorithms can in fact perpetuate various forms of discrimination over time. Examples include insurance companies employing algorithms to charge minority communities higher premiums than white neighborhoods - despite the fact that the risks are the same in both. To answer the question of how EvolutionIQ avoids this type of prejudice, Vykruta says the firm invests in "explainability" tactics, which help to make it obvious which criteria are taken into account when making decisions on the platform.
It is not simply a matter of getting the model's raw weight from EvolutionIQ." As Vykruta noted, "They translate the system into a language that [claims adjusters] can understand." "[The software] is only displaying items that they can take action on."
Aside from the dangers, EvolutionIQ is not alone in its pursuit of the possibilities. In addition to CCC Intelligent Solutions, which provides technical solutions to the automobile and insurance industries by leveraging data science to expedite claim processing, the company also competes with others in the industry. Riskcovry is another up-and-coming player in the field, with customers that include financial institutions, fintechs, and supply chain companies, among others.
The insurtech industry, on the other hand, is well-funded, with one study predicting that global investments in insurance technology enterprises will top $10 billion in 2021, an increase from $3.1 billion in the preceding year.
In the words of Vykruta, EvolutionIQ intends to spend a large portion of the new financing to expand the capabilities of its engineering, data science, product, and customer success teams. According to him, when EvolutionIQ develops into new and increasing insurance categories in the future, customer acquisition will be a top priority as well.
