The Atlantic hurricane season begins on June 1, and from a catastrophe (CAT) perspective, the last two years have been relatively quiet for insurers, providing them with an opportunity to regroup following Hurricane Sandy.
Some of the most costly and dangerous hurricanes, wildfires and tornadoes have occurred within the past 10 years, giving property and casualty insurers, their vendors and the Federal Emergency Management Agency (FEMA) plenty of opportunities to learn from past mistakes and prepare for the next “big one” to hit the U.S.
New tools and technology are available to assist insurance professionals with everything from risk modeling before an event to drone and robot technology that can provide views of damage in areas immediately after a catastrophe.
Social media also plays an important role in keeping customers apprised of what’s happening with a disaster. From educating them on how to prepare and minimize risk to getting onsite reports after an event, social media is fast becoming an effective means of communicating with customers. It also can be used to tell residents where a carrier will be set up after a disaster so customers can file claims. Emails and text messages can update insureds on the progress of their claims.
With all of these advancements and the lessons learned from previous events, we asked some industry professionals how to improve customer service and satisfaction following a major catastrophe. Here are five factors that impact how successfully insurers respond to their policyholders.
1. Policy checks
Make sure policyholders have the proper insurance before the catastrophe hits. This includes earthquake insurance in quake-prone states, flood insurance and other specialty riders for events not covered under normal homeowners policies. “At the time of a catastrophe, the policyholder too often realizes that their replacement cost coverage may not be what it seems,” says Bruce Kabat, chief operating officer of Adjusters International Colorado. “Prior to a devastating loss, it is critical for the insured to understand how such factors as code upgrade coverage, co-insurance, and even deductibles can impact their recovery.”
2. Education and training
Rarely is one disaster like another, and although there may be similarities, each event requires its own disaster plan.
“Education and training are key,” says Rod Harden, head of catastrophe claims for Farmers Insurance in California. The company provides continuing education and training for employees and agents through its University of Farmers. “We conduct mock events and drills on a consistent basis to ensure that team members are ready to react and respond as a cohesive unit. Locally based Farmers agents also share safety information and helpful tips with customers throughout the year, while consumers are also able to access a series of smart tips via Farmers Inner Circle.”
3. Solidify vendor and adjuster relationships
After a CAT, any challenges are magnified and getting basic supplies like gasoline and plywood are harder because of the demand. Everyone in a large area that’s been impacted is trying to access the same services and provisions, and collaboration by all first responders is critical to meeting the needs of residents and insureds.
“No restoration contractor has enough equipment sitting idle waiting for a Katrina or a Sandy or any major catastrophe to come along,” says Ken Rothmel, director of strategic accounts for Sunbelt Rentals, Inc., a national equipment rental company. He recommends that companies responding in the wake of a catastrophe make sure they have a strong relationship with an equipment rental supplier. He adds that depending on equipment from within the impacted state is shortsighted.
The same can be said when it comes to establishing relationships with vendors who will be working for the insurance company and its team after the catastrophe. Determining the insurer’s expectations up front is crucial, whether it’s for an independent adjuster, an engineering firm, a restoration company, a temporary housing company or any of the other firms supporting an insurer’s efforts with its insureds.
Vetting vendors ahead of time is also important to maintaining the customer relationship. In the case of restoration contractors, their employees are spending more time with the insured than the adjuster. “Know the restoration contractors in your area and only use vetted contractors who are experienced, staffed and equipped to effectively manage losses during CAT events,” says Dave Robbins of Sharp, Robbins & Popwell, LLC in Bartlett, Tenn.
4. Maintain communications after the CAT
When a hurricane, tornado, snow storm or other disaster strikes an area, adjusters know that everything seems to slow down and speed up simultaneously. Claims volume increases dramatically, making it difficult for adjusters to keep up with the influx.
When carriers bring in outside professionals to supplement their staff adjusters, communication between the parties is imperative. “Independent adjusters at ground level usually operate under the supervision of a firm specializing in catastrophe claims,” explains Peter Crosa of Peter J. Crosa & Co., a Florida-based independent adjuster and private investigator firm. “Any communication with the ground-level adjuster usually comes from their immediate supervisors, who get the communication from the insurer. Regardless of how it comes down, there must be a clearly defined path of communication to the ground-level adjuster.”
Photo: John Wollwerth/Shutterstock
5. Speed of response matters
Insureds want to see or at least speak with their carrier’s representative after the loss. Anyone working for a carrier in any capacity represents the company to the insured and has the ability to impact the customer’s satisfaction. “Having contractors in place to help the insured is a critical part of the claims service and, frankly, it’s expected by the insured,” says Rusty Amarante, CR, director of operations for BELFOR, an international disaster recovery and property restoration firm headquartered in Birmingham, Mich. He says customer service is far more than just handing a policyholder a check.
Harden agrees. “A good customer experience is key. Experiencing a [catastrophic] loss can be one of the worst moments of a customer’s life. It’s important that companies have well-trained staff ready and respond compassionately and professionally to customers when they have been affected. Training shows through in the customer experience and every touch point, from the agent to the claims handler.”
The good news is that insurers continue to learn from previous events and are seeing improvements in customer satisfaction. “I certainly think we are all moving in the same direction when it comes to catastrophe responses and customer service,” says Harden. “I think speed of response and level of training for staff is what everyone needs to focus on in order to serve their customers better.”