Filed Under:Claims, Education & Training

Opinion: Improving Claims Processes, Adding Revenue

Policyholder Retention and the Bottom Line

Claims are typically viewed as an expenditure, outflow, and a deficit. They are a point of contention that can often result in conflict with a loyal customer. In many respects, claims are where the battle for retention is won or lost. At their very best, claims are certainly not a celebrated moment in the customer relationship management lifecycle. If claims are at the root of customer dissatisfaction, and the only sustainable advantage a company has is providing superior customer service, then why aren’t more efforts and resources focused on truly changing this rudimentary problem?

Consider a new vantage point, one that instead sees claims as a paradox─a problem that can be part of the solution. While there are commonalities in processes across home, auto, and other claim types, the link to the customer at this critical point is the same. In this article we will focus on the imperative connection in personal property claims. Intimate processes as insurance claims go, but as with all claims, when executed effectively property claims can transform a business.

Historically the insurance industry has embraced a culture of acquisition, not innovation. After all, it's easier and faster to write big checks than it is to change the way business is handled. Methods only change after the customer has become fed up and frustrated, threatening the bottom line through attrition. As consumers see technological advancements, more self-service options, and improved accessibility from other industries, they are demanding the same of us. Claims handling must become more agile and more customer-centered, especially where personal property claims are involved.

Many are quick to spend huge sums on trendy, egocentric bandwagons, for example telematics, that strictly benefit the company. However, they seem to ignore the economic significance of improving current processes to keep a customer versus the cost of acquiring a new one. Simply applying universals to claims no longer works. This in large part is because of an industry that still does not fully understand its customer; their needs and wants. Insurers are stuck in a cycle, trying to match customers with what is being produced, rather than being truly customer-centric. A multifaceted variable, claims is not an organic chemistry. The process is made harder than it needs to be. To truly keep customers satisfied, adjusters must be empowered to confidently handle the claims process and maintain a mutually advantageous connection with the policyholder. The challenge: how to simplify current systems, without disruption, while keeping the customer engaged and involved.

Perception Not Always Reality

The Customer Comes Second: Put Your People First and Watch’em Kick Butt, by Hal Rosenbluth and Diane Peters points out something so simple yet so often forgotten: when a business’ people─including any extension of its brand, for example independent adjusters─are happy, content, and empowered─their customers are immeasurably more satisfied and loyal.

A cloud Software-as-a-Service (SaaS) or on-demand pay-as-you-go service abolishes the traditional “load, update and upgrade” business technology model, virtually eliminating all maintenance and required hardware issues. Moving these new dynamic non-core software tools for the adjuster from a fixed (capital) expense to a variable (operational) one, companies can easily budget low, flat-fee usage as a claim item expense on an as-needed basis. These days the need to “own,” or “build” custom applications is archaic and costly. There are few, if any, strategic advantages. The advancements and acceptance of cloud computing has leveled the playing field, truly democratizing claims. Small- and medium-sized enterprises can now implement the newest claims technology, methodologies and innovations without asset-heavy IT departments or costly custom development.

Managing claims in the cloud can increase productivity and improve communication and collaboration during the claims process. Ease-of-use gives the adjuster the confidence to perform these tasks on their own instead of involving expensive third-party vendors. Real-time anywhere-access data eliminates pivotal flaws in current procedures such as the customer having to repeat information multiple times to multiple representatives. This alone can be a tipping point for customer satisfaction index scores when a claim involves contents.

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