OCR technology delivers results for ICWA

9 June 2017

In June 2015, the Insurance Commission of Western Australia (ICWA) implemented Optical Character Recognition (OCR) technology to automate the capture of insurance claim information received in hard-copy form and via email.

ICWA is the State’s motor injury insurer and self-insurer of State Government agencies. It manages over 30,000 insurance claims each year.

OCR technology is being increasingly used by businesses to automate manual processes and to make administrative processes more efficient.

Claims documents that arrive via email, post and fax are now automatically scanned and entered into ICWA’s OCR system.

The technology has delivered results that exceed expectations for ICWA. Of the 1.2 million documents received by the organisation annually, over 770,000 are now indexed via OCR technology, resulting in a significant decrease in manual data entry effort.

Indexing refers to the way documents are stored in the system so they can be easily accessed by ICWA claims staff to manage each claim.

Business Improvement Manager, Neil Morfitt, further explains that “the OCR technology integrates with ICWA's workflow technology to send information to specific staff or areas of the business for action.”

“As a result, there is a decrease in administration effort for claims staff which allows more time to focus on customer engagement and claims management,” said Morfitt.

“This helps us achieve our goal to increase the efficiency of claims handling through lower administration costs, which helps keep insurance premiums affordable.”

Using this technology, the cost to index a document has decreased from $1.30 two years ago to $0.80 today. It is estimated that OCR technology has already saved ICWA $1.6 million and will eventually reduce its operating costs by approximately $1.8 million per annum.

Chief Executive, Rod Whithear, said that the implementation of OCR technology was timely as the volume of documentation received by ICWA rose by 22% over the last three years.

“The technology has enabled us to handle increased volumes of documents while reducing administration costs and staff time spent on data entry,” he said.

“This is a tangible productivity improvement.”

Morfitt explains that ICWA plans to make further productivity gains through a second phase of the OCR project.

“The OCR technology currently doesn’t recognise all fields within a document and there are still 800,000 fields that have to be manually entered by ICWA claims staff each year,” he said.

“The next phase will take most of the fields, not currently identified in the documents, and automatically populate them into our claims and financial systems.”

“This means ICWA will be able to automatically process payments for most claims invoices,” said Morfitt. 

ICWA estimates the second phase of the OCR project can reduce the administration cost of invoice processing to less than $3 an invoice, from $7.50 per invoice prior to this project commencing. This will deliver further financial and efficiency improvements for the organisation.