By Grant Mizel
In the aftermath of a catastrophe like Hurricane Laura or the COVID-19 pandemic, many businesses are left unable to operate at full capacity. Standing between these business owners and their insurance payout is the forensic accounting process. While larger businesses may be better positioned to withstand a business interruption (BI) event, smaller businesses without extensive cash reserves or other means of generating revenue are most at risk, so any delay in processing a claim can be a real concern. The events of 2020 have brought threats of lost sales contracts, employee layoffs, permanent closings and more like these into sharp relief.
Advances in technology often help level the playing field for small and medium size businesses, but innovation in the forensic accounting industry over the past few decades has unfortunately been limited to advances in Microsoft Excel (which, frankly, has helped no one, large or small). As the tool of choice for evaluating BI claims since the industry moved on from paper ledger sheets, Excel certainly has a useful set of features to help calculate claims, but when claim volumes are high and the speed of business matters, Excel is not enough. In its place, Lowers Forensics International has been utilizing a homegrown application that has helped our team of forensic accountants stay ahead of claims in 2020.
Stratis™, LFI’s proprietary small claims calculation tool and the industry’s most sophisticated BI quantification platform, represents the next evolution in forensic accounting technology. Stratis™ helps LFI’s carrier clients better serve ALL their insureds by pairing the advantages of artificial intelligence and automation with human expertise to achieve workflow efficiencies otherwise unobtainable. By automating some of the more mundane and repeatable tasks like sending out Requests for Information (RFIs) or formatting Excel spreadsheets, Stratis™ helps LFI ensure that every claim we work on is processed faster, more efficiently, and at a lower cost.
During a catastrophe, every moment counts. From the gathering of facts to the crunching of numbers, it is crucial for a forensic accountant to prioritize and focus on where their expertise is most needed. Stratis™ allows LFI’s forensic accounting team to allocate the majority of their time to crafting the appropriate calculation for each claim and putting reports in the hands of our clients, rather than on file administration and formatting workpapers. This allows each LFI accountant to handle more claims than they would be able to otherwise and allows our firm to then pass on the efficiency to our clients with flat-fee pricing that is significantly lower than our competitors can offer.
Building Stratis™ internally has also helped LFI create a standardized workflow and bring a new tactic to handling claims. We’ve created industry-specific models that apply to a wide variety of claims, from quick-serve restaurants and rental properties to museums and hotels, that allow our accountants to choose the model that best applies to a particular claim, quickly enter the necessary financial data, tweak the calculation for any claim-specific parameters, and automatically generate a simple and straightforward report and supporting schedules. These models are structured to provide a consistent approach to handling claims, but they are flexible enough to be customized to suit any type of business or peril.
Stratis™ has helped LFI revolutionize how we process insurance claims accounting and we’re excited about the efficiency, cost savings, and transparency it’s brought to the industry. And since we are continuing to refine and enhance the platform, we’re excited to say that this is only the beginning!