Innovating the Contents Claims Process

Simplify, Empower, Collaborate

Creating customer loyalty with personal property insurance policyholders is no small task. However, it can be done if you are willing to think big.

For many, it is simply easier to “play it safe” than it is to innovate or rethink current methods when it comes to handling contents losses. While more and more insurers are shifting their focus and beginning to downplay the high stakes game of low rates, the realization of how the customer experience impacts revenues takes center stage. No area is more fundamentally relevant and has a greater upside potential than claims, and more specifically, personal property claims.

There is a groundswell occurring to “recapture” this segment of the claims process; innovate and transform it into an opportunity that can differentiate a company’s level of service to their customer.

Contents losses are a two-sided coin. On the one side, they are among the most time-consuming and complex of all property losses, arguably the most loathed by adjusters due to the intricacies involved. On the other side of the coin, most insureds do not understand structure losses and repairs—engineering, construction, framing, drywall, and more may be involved. Personal property losses are just that—personal. Because this loss is uniquely personal, the claims process is a rare and extraordinary opportunity to connect with customers, build trust, and improve retention by involving them in the claims process. The insurer, agent, or adjusting firm that understands the personal connection of this loss type and responds accordingly can very well create a customer for life. Additionally, a customer who has an exceptional experience is very likely to spread the word to friends, neighbors, and relatives.

Thinking Outside the Box

Improving the customer experience requires improving the claims process, both internally and externally. Let’s start by dissecting the internal process.

The current system is chaotic, disorganized, and expensive. Years of overly complicated processing procedures have forced many companies to outsource—at extraordinary costs—and created an atmosphere for adjusters that cripples their ambitions and abilities. Hand-written lists converted by manual entry to a portable document format (PDF), or to a Microsoft Excel document, then to a PDF, then to an email, and then to a PDF again creates more confusion. How many times have you asked yourself which spreadsheet is current? Which PDF is most recent?

Moving the contents claims process to the Web is a strategic step. However, if we do not change the way we execute the process, then changing the platform on which we function will likely leave us with the same dysfunctional system. Moving clutter from one closet to another still leaves you with a messy closet.

From the insured’s point of view, moving to a Web-based claims process makes sense. Currently, the process does not give the customer much of a role; he or she provides a list of losses and the next point of customer involvement is likely when the check is received. A cloud-based system gives the insured the opportunity to be more engaged, provide greater detail for their claim, saves the adjuster time and, ultimately, the insurer money.

A New Strategic Approach

Before simply duplicating the same processes with newer technology, we need to thoroughly examine the “hows” and “whys” and see which steps might be shortened or even eliminated from current procedures. It is time to rethink and streamline efficiencies that directly impact bottom line results—current methods and behaviors must change.

Here are five pragmatic strategies you should consider for innovating and recapturing your contents claims process:

1. Collaborate: Improve Inventory List Quality

Many current methods focus importance on item pricing. While this is a significant step in the overall process, it is secondary to list creation and quality of item detail. Through online collaboration between the insured, adjuster, and carrier using a common unified platform, you can create a higher quality list at the claims inception, effectively eliminating 80 percent of item pricing issues and discrepancies upfront. This single strategy will “set the stage” for the entire claim life cycle and prevent costly oversights.

2. Eliminate Manual Tasks and Ad Hoc Processes

We must think of this as claim interoperability: an all-in-one process merging the customer claim experience, adjuster estimatics, and back-end processes into a single seamless environment. All claim steps, data, and processes (personalized insured Web-based list creation, item submission directly to the adjuster, full claim item adjustment, payments, receipt tracking, etc.) are completed within a single uninterrupted platform—in real time. Complete continuity in the service delivery process gives the customer a remarkable claim experience while dramatically improving claim efficiencies.

3. Empower: Take Self-Service to the Next Level

The strategic importance of how the front-line workforce intersects with the customer is a defining moment in the claim cycle and customer engagement. This is a critical step in building trust and loyalty. Today, technology is one of the most effective transformational factors for enhancing the customer experience with innovative self-service options. The social behaviors of the insured have evolved to a point where he or she not only wants to be involved in the claims process, but also demands it. Taking an analytical approach to modernizing and simplifying this vital part of the contents claim process is a paradigm shift. We must change as needs change and think as the customer thinks. Insurers will gain significant advantage by creating better levels of transparency and involving the customer in the process. Providing a safe, structured environment that assists and encourages customers to participate (at their convenience) and follow the entire progression of their claim will help achieve faster, more agreeable settlements with higher satisfaction levels and less exposure to liability and litigation issues.  

4. Streamline Claim Estimating Workflow Process

An important component of “outside-the-box” thinking is changing our perspective—design and execute from the customer and adjuster point of view instead of our own. All of the time, money, and resources spent on claims systems and few seemed to ever rethink estimating. Contents losses can remain open long after the structure settlement—in many cases for months, if not years, thus making it immensely time consuming and expensive. Yet, personal property has been more of an afterthought and is rarely considered when rethinking claims systems. Current software platforms have similar mechanical routines and bland interfaces, often not conducive to real-world adjusting and certainly lacking a dynamic workflow experience. We must adopt methods that embody efficiency by reinventing behaviors of the insured, adjuster and carrier throughout this claim process. We need to create a contents claim workflow navigation that animates an otherwise mundane and prolonged task.  

5. Matching Receipts

Managing replacement costs is perhaps the most time consuming and expensive part of the adjusting exercise and can debilitate resources. Managing a claim file, whether paper or electronic, and attempting to reconcile replacement receipts with items from the insured’s list do not have to be overwhelming. With a shift to a new level of Web self-service options the insured would attach, match, and upload their receipts directly to their assigned adjuster. This savings in employee payroll would be a significant addition to the bottom line.  

The contents claim process should be viewed as an essential opportunity to connect with and service the customer while building trust. Designing the process with the customer in mind is a strategic imperative for developing a business culture where the customer is valued.

An important piece of this new culture is improving the adjuster’s experience. We must regain and polish a “pro” adjuster mindset. The adjuster’s role is critical to the contents loss process. It benefits both the company and the customer having developed the adjuster’s self-worth and pride in his or her work. Adjusters are the frontline workforce directly interacting with the customer and should be valued as such. Incorporating technology that complements the adjusters’ tasks and improves efficiencies will attract and engage the right people with an end result of an improved “bedside manner” and a new level of loyalty.

While out-of-the-box thinking can be creative and unconventional, enlarging your vision of the claims process requires leadership, strategy, and innovation. We need to see beyond ordinary methods that do not improve the customer’s experience and claim efficiencies or lower cost structures. We are at the forefront of transformation in claims. The strategies above are just a few ways we can start to reorient our thinking towards innovation, focusing on improving bottom line results and profitability without the pressures of driving top-line growth.

Jamie Gladman is the senior partner and co-founder of MyContentsClaim, which provides innovative on-demand claims solutions and services to insurance carriers and their policyholders for contents inventory creation, adjuster estimatics, and workflow administration.

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