Companies test virtual claims technology

Technology innovations such as virtual inspection tools can slash the time it takes for finance-and-insurance companies to validate claims for damaged vehicles by removing in-person confirmation.

JM&A Group, one of the largest independent providers of F&I products to the automotive industry, launched Inspect Now to help streamline the claims adjudication process. The service allows the company's analysts to use video to work with repair shops on visual inspections.

"We know people can use FaceTime technology," said Dianne Galavan, JM&A Group's director of customer services. "But what is different in how this was designed and created is we are actually capturing that video and holding on to that documented recording so we can keep it for this further review."

New innovations won't throw humans and in-person inspections to the wayside. There still will be many instances where a human is better suited to inspect a vehicle in person to adjudicate a claim, Galavan told Automotive News.

All claims are unique, so a virtual inspection depends on the client, what the concern is, how busy a dealership's service department is and whether a technician is available, she said.

Road-hazard tire claims and oil leaks are two such claims that usually can be verified via a virtual inspection, Galavan said. It's easy to see whether a tire is damaged or if a vehicle on a repair shop lift is leaking fluid. A visual of those problems can be captured on a cellphone and shared with company analysts, Galavan explained.

Inspect Now officially debuted in February after a soft launch last year.

"Ever since I can remember we've had inspections in place, so it really was [saying], 'How can we make this better, how can we make it more efficient, and really, again, what technology is there? Why not put this to use?' " Galavan said.

The idea with virtual inspection tools is to get customers in and out of repair shops quicker and save F&I claims analysts a trip.

Other F&I companies also are dabbling in virtual inspection.

Over the past three to five years, Zurich — a global insurance company that provides F&I products and training services to U.S. auto dealers — said it has been experimenting with using photo submissions in place of in-person claims inspection.

Virtual claims handling is available for Zurich's vehicle service contract policyholders. The company has not yet launched any special technology, such as a mobile app, for customers to make claims. But it is testing a video-enabled, Internet-based remote collaboration tool for virtual consultations with customers, said Josh Spencer, associate vice president, project leader, at Zurich North America.

"In addition to incorporating video into claims handling, we are exploring a digital component that will take the claims process from beginning to end online," Spencer said.

Assurant Global Automotive, another insurance provider that offers a slate of F&I protection products, decided to offer a video-enabled virtual claims process after deciding it was inconvenient to conduct in-person inspections for every potential claim.

"For the dealership, it meant that they were waiting to get the customer taken care of, because typically even getting a person out there physically [to verify a claim] is going to take 24 to 48 hours," said Martin Jenns, Assurant's senior vice president of global transformation.

That meant frustrating waiting periods for customers and additional dollars Assurant had to spend to provide rental vehicles.

Carrying out an in-person inspection every time also affected dealerships, as broken-down vehicles took up valuable space on repair racks.

Jenns said Assurant decided to incorporate video to streamline the claims process.

"The way that it works today is that most times, when an inspection is required, we can queue those up in a virtual way. So we basically have somebody in the dealership to take pictures or videos, upload those to us and then we can review them almost on a real-time basis, but expedite the entire process so that everybody ... doesn't have to go through that type of experience," he said.

Assurant's service doesn't have a name. Jenns simply refers to it as the company's "virtual inspection tool."

Larger and costlier claims, especially ones that seem inconsistent with a vehicle's normal wear and tear, don't usually get a virtual inspection. That's when it makes sense to get eyes on the vehicle, Jenns said.

F&I companies also have their guard up against the use of deepfake technology to trick a virtual inspection process.

A deepfake is a piece of synthetic media that swaps a subject in a video or photograph with a possibly convincing but false computer-generated image.

The term "deepfake" is taken from "deep learning," an algorithm- and machine learning-based branch of artificial intelligence.

Some applications of deepfake technology are harmless, such as when a visual effects artist uses it for a film.

Other applications are more nefarious. The technology can be leveraged for revenge porn and financial fraud, among other things.

"It's not that we're allowing a shop to take a video and then submit it; that's not the case," Galavan said when asked whether deepfakes could muddle the virtual inspection process. "We have one of our team members that is on the live video throughout the process."

The first step is to validate the VIN and repair order information in real time.

"Just the inspection process — whether it's a standard inspection or a real-time inspection — just the idea that a vehicle is getting inspected acts as a deterrent," Galavan said.

Assurant analysts also check the VIN first and make sure it matches the vehicle they're seeing in the virtual realm.

"I'm not saying that it would be impossible to do a deepfake virtual inspection," Jenns said, "but you'd have to go through quite a bit of chicanery to make that work."