How do you know if your claims organization is producing aquality product? After all, there are numerous ways to identifyquality, right? While no two carriers or claims processes arealike, there are often similarities. From FNOL, abandonment rate, and contact timeliness to cycle time,alternative parts utilization and average indemnity, there seems tobe no shortage of usable metrics. But is this the optimal way togauge performance?

During my years as a process and quality leader for a largemultinational insurer, we grappled with a myriad of metrics in ourquest to find the ideal formula to drive optimal results. Much likea football team, the claims organization was measured onstatistical data points that were supposed to be indicative ofoutcomes. Just like a lot of points should win football games,prompt contact and inspections should win the claims race.

So what happens when all those metrics are surpassed, yet thereis a rise in blown coverage, errant liability decisions, orlitigation? While I am not minimizing the importance of statisticalclaims data points, I do like to put them into perspective. Justlike football, there is only one statistic that truly matters aswinning records are based upon accurate outcomes.

When designing a quality assurance process, emphasizing ultimateoutcomes, or accuracy, takes into considerationall else. The actual investigation—includingtimely contacts and inspections, accurate coverage and liabilitydecisions, effective negotiations and recovery opportunities—willultimately drive accuracy. Metrics can then beused to predicatively model process improvement initiatives.

In many instances, far too much emphasis is spent on metrics asopposed to accuracy and investigation. In some organizations, somany metrics are measured that very little emphasis is placed onany singular data point resulting in everything being a lowpriority. For example, if subrogation identification is 2 percentof an annual evaluation, how much emphasis will be placed onidentification and referral? To the contrary, a total quality modeldriven by a single quality score should result in improvements inall aspects of the claims process. If this cumulative total qualityscore is used to drive individual metrics, then the paradigm of theorganization will change from chasing numbers to chasing results.

To emphasize accuracy, certain key milestones should beaddressed during the evaluation process. At a minimum, this shouldinclude data compliance, coverage, liability, investigations,subrogation, salvage, timeliness and accuracy. Within eachmilestone, there should be a subset of data that is measured todetermine if a file is worthy of replication, or reproduction. Whenthis occurs, a file may be deemed to meet expectations.

It is also important to reiterate exactly what constitutes anacceptable work product and calibrate the organization so thateveryone—from the executives to the rank-and-file employees—are onthe same page. Doing what should be done in a file, consistently,timely and accurately, is precisely what should be defined as“meeting expectations.” Nothing more, nothing less.

To exceed expectations, one must go above and beyond the call ofduty. Calling someone in seven hours versus the eight hourrequirement hardly constitutes exceptional work. Rather, a personmust take the initiative to think outside the box, dig deeper andfarther, and turn up critical pieces of information that alter theoutcome of what a standard claim investigation would have done. Itcan be done; it is the exception.

As I discuss in Re-Adjusted: 20Essential Rules To Take Your Claims Organization From Ordinary toExtraordinary, using concepts to drive accuracy,investigation, metrics (AIM) can fundamentally transformany team. It will move from reactive to proactive an entireworkflow that will expose inefficiencies that can be remediated,resulting in continual process improvement which will giveadherents a significant competitive edge in the marketplace.