While reviewing my previous write-up: ISM_NCD system & the future of it….felt something might have crawled into my brain cells….Yep! I think my brain cells are still functioning….after some heavy drinking session!
While in the previous write-up, I may have written about single option – point of sale NCD real-time approval, I still have doubts whether we can be successful in plugging up the hosts of issues surrounding data submission.
The current “lock, stock and barrel” nature of database submission by insurance and takaful companies to ISM system may not be practical and would be a real stumbling block in the months to come. From previous analysis, the success rate of data submission is only 75% or lower, which can be translated into a system of low performance. Guess-ti-mate, for submission if the total number of policy in a year totalled to 12 million, endorsements at 6 million and claims numbered 2 million, at 25% rejection level, we should estimate some 5 million doc-data pieces spilled all over the place! This is just in a year….can’t think though if accumulated over a few years! How can we actually fix this within two to three months? Perhaps we should reconsider the submission of this “lock, stock & barrel” method, and work towards a claims-database submission ONLY…what say you? The less we submit the less error would exist for the database!
Why work towards a claims database submission? Simply put, the industry members need time to resolve their IT system including integrating with ISM-NCD system…. All insurers would have lesser data to submit / update to ISM for purposes of NCD and there would be much lesser or no data of this nature getting rejected. Insurers and their agents need only check the ISM – NCD database for claims, if claim is recorded where the proposer is at fault, then the NCD will be zero-ised (or step-back, if you know what I mean….BNM’s proposal!) on renewal. If there is no claims record, the proposer will be allowed an NCD as prescribed from the expiring policy with the necessary “letter of undertaking” signed. NCD given is then subject to “out of the ISM system” confirmation…. If NCD is not confirmed as prescribed then would be endorsed for premium recovery.
Well you may have guessed it correctly – we are going back the old ways….very much similar to “Back to BM for Science and Maths” but perhaps this combination of “lesser” data submission (therefore less errors) and manual confirmation is still more efficient for the timebeing until the proper ISM-NCD platform is effectively mapped out.