CAT plans, like strategic plans, tend to be crafted in officesfar away from the adjusters who will implement them. Thesevoluminous, dust-covered binders sit comatose only to be revivedwhen an actual catastrophe looms.

Failed CAT plans have costly and long-term consequencesincluding: interest on late claims payments, unnecessary claimscleanup teams, loss of goodwill, lack of retention of insureds,litigation costs, unfavorable court decisions, and potentialbad-faith or punitive damages.

CAT plans fail because they:

• Are not scalable

• Do not prepare adjusters

• Are not adaptable

• Are not coordinated

• Do not empower adjusters

• Are not sustainable

CAT plans that aren't scalable fail.

Long gone are CAT plans that can rely on 2,500 staff waitingidly for the next event. Failed CAT plans can force highly-skilledadjusters into set-for-failure management positions that they'regenerally untrained for and loathe.

Smart companies plan for scalability depending on: CAT size andtype, recent storms and general storm severity. They use geographicinformation systems to predict claim volume and severity. In thisage of smartphones, phablets, tablets and social media, insurersstill rely on traditional communication methods. Smart companiesenlist tools to seek out data from social media sites for claimsreporting and ongoing claims communication.

CAT plans that don't prepare adjusters for a stormfail.

Failed CAT plans rely on TPAs or independent adjuster partnersto “go handle the storm” with little direction and/or control overquality or expense.

Smart companies train year-round for storms and build pre-eventrelationships with vendors such as engineering firms, tree-cuttersand hotels. William C. Bracken, PE, president of BrackenEngineering says his most popular training topic for insurersinvolves state building codes. “Trained adjusters who understandbuilding code basics are better prepared to identify and properlydeal with legitimate code upgrades.”

CAT plans that aren't adaptable fail.

Failed CAT plans don't consider contingencies like the secondstorm of the season or lack of infrastructure for connectivity toInternet-based claims systems. Failed plans don't addressstate-level statutes for timely contact/follow-up or claimspayments within certain time limits.

Smart companies remain adaptable after a storm has madelandfall. Paul Neilson, vice president of claims at HeritageProperty and Casualty Insurance says no CAT response is ever thesame. “We have to be cognizant of bottlenecks that can developwhile handling high volumes of claims and be flexible enough topromptly respond with the proper resources.”

CAT plans that aren't coordinated fail.

Failed CAT plans lack coordination between insurers and theirTPAs or IA firm partners, leading to duplication of efforts,bottlenecks and adjuster burnout. CEO of Crawford's U.S. Property& Casualty business, David Repinski, states that without clearalignment there is a lack of clarity about the role they will play.“Will we be the first wave or secondary to their adjusters? Will webe one of many providers? When insurers communicate to us our rolepre-event, we have a successful partnership.”

Smart companies begin coordination months before storm season,have post-event debriefs to memorialize what worked, what didn'tand then implement improvements.

CAT plans that don't empower adjustersfail.

Failed CAT plans take weeks for adjusters to “earn” adequateauthority to pay claims. If an adjuster isn't empowered to makedecisions, then the insureds get frustrated and claims remain open.Smart companies understand they get more from the behavior theyreward. When they reward only cycle time – they may get shortercycle times, but more reopened claims.

CAT plans that aren't sustainable fail.

Failed CAT plans are sustainable only for the CAT of the season,but not for subsequent storms since the needed adjusters areworking the prior storm. Failed CAT plans depend on constantsources of power, connectivity and close-to-storm housing.

Smart companies test systems and call-centers to pre-determinemaximum claims levels for all CAT-related departments to reaffirmCAT readiness. Smart companies have fallback plans ready when plan“A” doesn't work.

The best CAT plans are always flexible, prepare the staff, arecoordinated efforts, empower adjusters to make decisions and aresustainable.