Tackling claims leakage with smarter repair cost validation

Claims leakage has long been one of the insurance industry's most persistent challenges. While significant attention is often given to large and complex losses, a substantial proportion of building claims fall below $20,000 – and many of these repair quotes receive little or no detailed cost validation before work begins.

Industry estimates suggest that unchecked repair costs can contribute to claims leakage of between 8% and 12%, representing a considerable opportunity for insurers to improve claims outcomes without affecting customer service.

Why are so many quotes left unchecked?

Traditionally, validating building repair quotes has been a labour-intensive process. Existing pricing guides rely on historical, static data and require specialist knowledge to interpret effectively. Manual reviews by experienced assessors and loss adjusters provide valuable oversight, but they are time-consuming, costly and difficult to scale across high claim volumes.

As a result, many lower-value claims proceed without comprehensive cost validation. Even the common practice of obtaining two quotes does not necessarily confirm that either represents a fair market price.

A different approach

Advances in artificial intelligence are changing the way repair costs can be assessed.

QuoteCheck is an Australian SaaS platform that uses AI to validate builders' repair quotes against a live, regional pricing database before works commence. Rather than relying on historical pricing, the platform compares each line item against current market rates, providing insurers with greater visibility of repair costs in a matter of minutes.

The technology has been operating for five years and has been developed using local industry data, creating a continuously expanding foundation of Australian repair pricing information.

How it works

Once a builder's quote is uploaded, QuoteCheck analyses every line item against current regional pricing. The platform generates a marked-up version of the original quote, clearly identifying where pricing aligns with market rates and where further review may be warranted.

Because the assessment is automated, the process can be completed within minutes, allowing cost validation to occur without delaying the claims lifecycle. The technology is also highly scalable, making it practical to review everything from relatively small repair claims through to multi-million-dollar losses.

An additional benefit is the use of postcode-based pricing. As more quotes are processed, the underlying database is continually refined, providing increasingly accurate insights into regional labour and material costs. This enables insurers to benchmark pricing by trade and location, while also providing constructive feedback to repairers to help improve consistency across supplier networks.

Measurable returns

Unlike many enterprise technology projects, QuoteCheck is designed for rapid deployment. There are no implementation costs or lengthy IT projects, allowing organisations to begin validating repair quotes almost immediately. The platform also incorporates secure, locally stored data and follows robust information security practices.

QuoteCheck offers flexible pricing models suited to different claims volumes and operational requirements, from occasional users through to enterprise deployments. By enabling repair costs to be validated before work begins, the platform aims to reduce unnecessary claim expenditure while maintaining efficient claims handling.

As insurers continue to seek greater operational efficiency and stronger claims outcomes, AI-powered cost validation offers a practical way to address one of the industry's most common sources of claims leakage.