Insurance companies are known for their cautious approach, but AI is no longer viewed with skepticism. In fact, the KPMG 2023 Insurance CEO Outlook highlights a significant degree of trust in AI with 58 percent of CEOs in insurance feeling confident about achieving returns on investment within just five years.
Synatic, has identified a key area ready for transformation through the power of Artificial intelligence (AI): the management of Direct Bill Commissions (DBC). By leveraging AI, agencies can significantly enhance the process of matching DBC statement information with AMS data.
Direct Bill Commission (DBC) statement matching is a manual process that is often hampered by human error. This labor-intensive processes means the finance or operations teams within an agency must run through the DBC statement from the carrier line by line, finding the corresponding policy in the agency AMS and matching them up to the statement.
Ensuring your agency’s AMS has accurate data is essential for verifying that you’ve received the correct commissions from insurance carriers and for accurately paying producers the commissions they’ve earned.
Each unmatched policy often needs to be sent to the Account Manager (AM) responsible for the policy via email and have them open each email and correct any discrepancies one-by-one. This is not only a laborious and soul-destroying task, but exposes the agency to significant risk of errors.
One of the main challenges facing agencies today is the lack of consistency in how information is captured by the carrier on their internal systems. For instance, a carrier might capture a policy number as SP4786, while the agency may record the policy as SP 4786, adding a space between letters and numbers. Another example is how the customer's name is captured. For example, a carrier may record a customer’s full name such as David Benjamin Smith, while an agency may only record an initial for middle names, such as David B. Smith. These small discrepancies result in massive matching problems.
Another place for errors to creep in is how to capture details of policy renewals. Agencies will retain the policy numbers year after year. However, carriers will record renewals as a new policy, often assign it a new policy number by adding a suffix (a letter or number) to make it unique. While this small change may seem inconsequential, it will significantly increase the likelihood of a mismatch between the policy numbers in the DBC statements and the policy numbers in the agency's AMS.
One way for agencies to try to mitigate the lengthy and expensive manual matching process is to outsource the job to Business Process Outsourcing (BPO) service providers. BPO teams perform manual processes and checks, highlighting the discrepancies and sending reports back to the agency requesting further instructions. This back and forth is an onerous process, adding layers of time, complexity and cost to a job that can be solved with the right technology.
While there is sometimes merit in outsourcing functions that are not core to your company, when it comes to DBC statement matching, there is a simpler and more sophisticated solution that delivers far more than just cost savings to the agency.
AutoDB Commission offers a comprehensive solution for managing Direct Bill Commissions by:
AutoDB Commission uses AI to analyze and compare every line in the commission statement against the data in the agency's AMS and automatically reconciles the statement entries with any discrepancies. This is real-world usage of AI, to reduce manual processing caused in suspense creation, and reducing suspenses by 95% to 100%. The time saving this represents is immense.
In the rare instance that matches cannot be automatically established, the solution assigns a percentage score to the unmatched policies. The agency’s Finance team or Account Managers (AMs) can then review the results and select the correct option. Additionally, the agency can set an appropriate score threshold to auto-match unmatched policies, further streamlining the process.
“Synatic's AutoDB Commission solution has revolutionized our processing of Direct Bill Commission Statements. Synatic automates the process end to end, reducing suspenses by 99% with automated matching, and better yet directs the reconciled statements to the correct end agency and the correct AMS. We're saving at least 10 hours per carrier per month!” - Tasha Brewer, Agents Alliance
AutoDB streamlines the entire matching process, saving massive amounts of time. In fact, it can take an operational or finance team member between 10 to 20 minutes to identify and correct a single unmatched policy. However, the AutoDB Commission process can take just 5 seconds to match 10,000 policies.
For agencies looking to optimize their operations and ensure their teams are focused on their core responsibilities, automating how they match their DBC statements must be a priority.
Not only will it eliminate teams bouncing between their mailbox and their AMS trying to manually fix DBC downloads and match them to policies in the AMS, but it will also eliminate the need for costly training on how to address unmatched policy errors.
When it comes to automation, AI can be counted on to eliminate the time, cost, and frustration of human intervention. If you want to learn more about how you can leverage Synatic’s AutoDB Commission to streamline your DBC process and simplify policy matching, contact Synatic today.
