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If you pause for a moment to shine light on your commercial contents claims handling process, then you might be surprised at what you find. Even a casual examination will reveal inefficiencies and inaccuracies the industry has been more or less sweeping under the rug for years now. This is remarkable and even a bit alarming when you consider that commercial contents claims have a natural complexity that make them ideal candidates for improvement. Rather than standing still, some innovative carriers are beginning to implement new approaches that dramatically improve accuracy, efficiency, and the customer experience for commercial contents claims.
A Patchwork Approach
Let’s consider the wide range of businesses and enterprises that can sustain a loss—retailers, manufacturers, hospitals and other health care facilities, educational institutions, libraries, religious institutions, and museums. The variety is endless. Without personal knowledge of each type of business, how can you quickly and efficiently get the business back up and running? What are the costs of materials, equipment, supplies, and finished goods? In trying to answer these questions, adjusters and carriers have traditionally relied on a patchwork approach, blending together a variety of resources: salvors, perpetual inventories, forensic accountants, engineers, insured’s lists, and so on. In addition to being cumbersome, this approach most often leads to redundancy, inconsistency, and inaccuracy in settlements.
The Inventory Sets the Foundation
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Historically, adjusters have felt pressure to become knowledgeable about an array of industries just to do perform the job. A growing number of commercial carriers have discovered, however, the benefit of specialized commercial contents claims services and software to achieve accurate and timely settlements. Adjusters armed with these fully integrated resources no longer must become overnight experts in several distinct industries. Instead, they are able to focus on the structural and BI elements of the claim, while the contents claims experts apply specialized knowledge, technology, and software solutions to the inventory and valuation of lost and damaged items.
When one considers a loss at a major city hospital, for example, this can be a huge burden taken from the shoulders of adjusters and carriers while the rest of the claim moves forward. To fully grasp the concept, weigh the following brief examples:
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The following are the key elements that, when working closely together, will help carriers improve the accuracy and efficiency of their commercial contents claims:
Repair versus replacement. Commercial claims become inflated when too much reliance is placed on insureds’ perpetual inventories. Field inventory specialists—and in some cases, those possessing contents expertise in that particular industry—are needed to conduct accurate on site inventories of all lost and damaged items.
Allison Judkins alleged that she fell while ordering a meal at the Chipotle Mexican Grill in West Palm Beach, Fla. She sued for negligence, claiming that a roof leak led to water pooling on the floor near the ordering station.