Picking up the Pieces

A healthy claims administration system is the backbone of any property & casualty insurance carrier, but not every insurer is fortunate enough to have new technology system available to assist them through the daily struggle of keeping claimants happy.

Claims technology and mobile technology for a claims organization's field force are two topics broached to five claims leaders who agreed to participate in our third annual Q&A on how technology is assisting the claims process.

This year's claims leaders bring a varied background—personal lines and commercial lines, tier one insurers and mid-tier carriers. Those who responded to our questions include: Mike Stapleton, senior vice president, claims administration, CNA; Brian Gore, claim strategy director, Allstate Insurance; Bob Khosropur, senior vice president of operations, Mariposa Insurance Services; Alan Hlad, claims and field operations leader, Westfield Group; and Mimi Chizever, vice president of claims IT, Nationwide Insurance.

What is the state of your claims administration system? If it is a legacy system, what are the drawbacks? If you have upgraded your technology, what kind of benefits have you seen?

Gore: In 2009, Allstate launched Next Gen Self-Service, expanded online tools that allow customers and agents to access information and perform claims tasks over the Internet 24 hours a day. Next Gen Self-Service gives customers the freedom and convenience of do-it-yourself claim handling.

Trends show that more and more web-savvy customers want options when it comes to interacting with service providers. Next Gen Self-Service is a response to these trends and gives customers the freedom of do-it-yourself claim handling for non-complex claims.

The re-platforming has allowed us more flexibility. Our infrastructure investments in our claims administration system have enabled us to rapidly adapt, update, and change both technologies and technology-supported processes.

We are making it easier for customers to do business with Allstate, especially in their time of need. Protection is our business, and when one of our customers suffers a loss and has to submit a claim, we need to be available how, when, and where they want to interact with us.

Hlad: We currently have a legacy claims management system. Some of the drawbacks include inefficient processes that limit customer service and employee productivity, challenges with data integrity, inability to integrate software solutions, and limitations with analytics and information sharing across the company.

Efforts are underway to replace our claims management system. This will take time and require a large investment—both in resources and finances. We're fortunate to have the support of the organization and are openly communicating the impact and benefits with all employees. They understand that improving workflows and analytic capabilities leads to enhanced customer service, which improves our brand.

Chizever: Our current claims application portfolio is made up of a number of different applications and technologies, some dating as old as 30 years. Our current platform has proven to be very complex to maintain and enhance as we have also tried, over the years, to incrementally move to a state-of-the-art custom build. In 2010, we made a strategic decision to replace our core claims applications with a packaged solution and initiated our Claims Transformation program early in 2011. We are fortunate that packaged solutions supporting claims have matured greatly in past years and proven the ability to support a company of size and breadth of Nationwide. We are now on a four-year journey to transform the way we support claims from a technology perspective. The benefits will include a consolidated technology platform that will enable our claims associates to even better serve our members in time of need.

Stapleton: We have both a legacy system and an upgraded system. Four years ago we started to build what we call One Claim Platform. We have a commercial claim organization and a specialty claim organization. They were on different platforms. On commercial we embarked on a program that introduced a claim platform and we have now upgraded to a current model for commercial claims. That was done in November of 2010.

We've migrated a portion of our specialty claims operation and we plan to have that done in another year. Having two systems creates its own sets of challenges around data integrity, financials, and people working in duel environments and creates more inefficiency.

This helps to support the culture around One Claim Platform. The new platform provides more robust data; it gets away from adjustors documenting so many files; and utilizes more structured data. Before, if you couldn't find it in the file notes, you couldn't find it anywhere.

Our claims field organization helped us build the new platform with areas such as what would be needed in their claim file. We can extract a multitude of data for whatever reports or knowledge we might need. It served a lot of internal needs to put one source of data in places where it is needed.

Khosropur: NBIC replaced its legacy system with BlueWave's Pipeline Claims system, which is a Java-based solution that combines business process management (BPM) with centralized claims operations to expedite claims resolution. This core system provides many advantages over the legacy system, including:

• Statistical reserving, and manual revision for loss and expense

• Create payments with either check or prepaid debit card

• The ability to create, use, and store correspondence, reports, photographs, sound files, email, etc.

• Identify and monitor subrogation/salvage potential

• Identify and monitor litigated files

• Utilize a rules-driven, task-reminder system for scheduled activities and general follow-up by adjuster and manager

• Enforce authority limits based on company role to monitor reserving and payment practices

• Enforce policy coverage limitations

• Basic financial reporting tool for daily inquiries

• Catastrophe coding and management

• SIU scorecard and flagging

• Vendor/contact management capabilities (across claims)

• Assigning claim handling to one or more adjusters or vendors directly from system (vendor and staff management)

In what ways is technology changing the way adjusters perform their jobs? What kind of savings can a company achieve through a more effective use of their time?

Stapleton: We are all looking to leverage technology to the ability we can. There are variables that come into play, but one of the things we incorporated here was moving to a paperless claim environment. For a commercial carrier with the type of claims we have and our volume of claims, it was quite an undertaking.

That was the first major step for us and we continue to move our teams to be comfortable in the paperless claims world. That's the way claims are sent today—email or an electronic format—and we want to make sure our environment supports our customers, our vendors, and any individual the claims department interacts with.

Having that piece of paper no longer sitting in front of them has been an adjustment, so we've spent a lot of time around change management and training and allowing individuals to grow in that environment. They probably feel a lot better about this today than they did three years ago when we embarked on this journey.

These have changed the expectations of the adjusters to perform on a timely basis because they have better access to information and the ability to make decisions quickly. There's an expectation from our customers that we have this availability of information and the ability to respond quicker than we did in the past.

When you look at BlackBerries and mobile devices, we are always available to our customers. It's not the nine-to-five we used to have. We are always attached to that device because it is our link to our customers and individuals who may need us.

Khosropur: There are so many levels of technology affecting a variety of claims professionals. Modern core claims systems help adjusters to be more complete in their documentation and timely in their follow up investigations.

All these built-in features drive timely claim handling, which can have two immediate cost avoidances for the insurer: 1.) Claims tend to be settled more accurately when the claim handling period is not unduly protracted. 2.) The cost of allegations and lawsuits surrounding the lack of timeliness around settlement are more easily avoided with systems that will remind adjusters and management that the clock is ticking.

Within each specialty of claim handling there are dozens of IT solutions to age-old claim handling tasks. What these solutions have in common is bringing increased accuracy, uniformity, and timeliness to the desk of each claim professional. Whether it be an auto adjuster looking for used parts, a property adjuster measuring a roof via aerial photo data bases, or a fraud adjuster taking advantage of sophisticated software seeking out patterns of suspicious relationships, all, and more, benefit equally thus bringing accuracy to the final claims resolution.

Gore: Technology allows us to communicate with customers how, when, and where they choose. Ideally it brings more velocity to the claim settlement process.

Hlad: Just as technology has changed the way we access and share information in our personal lives, it's also changing the way we conduct business. Tools, such as smartphones, tablets, and portable printing devices, enable claims professionals to handle customer needs faster and more accurately than ever before. This, coupled with a variety of new software applications, allows us to streamline processes and create work efficiencies.

As a result, our claims representatives can focus their efforts on core claims handling rather than non-value added tasks. They can spend more time creating a positive experience for our customers during their time of loss, conducting thorough investigations, and accurately resolving claims. In addition, technology is enabling field claims professionals to work remotely and handle much of their activities without the requirement of having to be in the office.

How is the role of the adjuster changing with your company? Are you supplementing your staff to independent adjusters? What must be done to sustain the quality of adjusters working in the p&c industry?

Stapleton: Technology can't take the place of experience. It can't take the place of the complete knowledge and someone's gut feelings—all those things that those senior people bring—and the expectation to share with the new people coming on board.

How do you take that knowledge and experience and put it in a way that those new to the industry will understand it and in a format they are comfortable with? Whether that is webinars, personal seminars or meetings, on-the-road training, or—taking a step back—having face-to-face contact with people like I did when I got into the claims world.

New people are used to communicating with text, email, voicemail and thing like that and you don't learn like that. The challenge is to take that blend of street smarts and experience and share it with new people and in a format that is conducive to the people we are hiring today.

The people today are in a better position than I was 30 years ago because they have more access to information. They seem to be energized by the Internet and how to obtain information. That's what we need: people who are inquisitive and interested in growing their knowledge in different ways.

Hlad: The roles of claims professionals are becoming more specialized and team-based to meet the needs of our customers. The advancement of software solutions and vendor network options gives us effective options to promptly and accurately resolve customer needs. As a result, the customer experience is enhanced by the adjuster having the right tools and processes to do their job.

We handle the vast majority of our claims with our own employees. It has been our philosophy to primarily utilize our own staff, especially during catastrophe and storm events, to provide consistent service and peace of mind to our customers. At times, we do use independent adjusters during periods of unusually high volume, or in geographic areas where we currently do not have enough claims volume to justify hiring additional staff.

To sustain the quality of adjusters working in the p&c industry, I believe we need to create an attractive environment for our employees to develop and grow.

First, work/life balance is becoming increasingly important to retain quality employees. This means developing flexible work arrangements, including flexible hours and the ability to work from home.  Employees are also looking for a casual, but professional work environment. This means promoting business casual attire and even the occasional “jeans day.”

Second, we need to invest in providing the latest technology. Our industry has a reputation for legacy systems and being one step—if not two—behind other industries. It will be critical to adopt advanced claims management systems, integrated software programs, web conferencing capabilities, and mature claims processes to optimize both customer and employee satisfaction.

And finally, we need to create cultures of meritocracy and clear career paths for our employees to grow and advance. This will become increasingly important as our economy continues to recover and employees have more career options, including opportunities outside of our industry.

Khosropur: In my previous position with Narragansett Bay Insurance (NBIC), we outsourced our property field inspections to independent adjusters for many years. With the speed and accuracy modern estimating systems bring to bear, we were able to convert our indoors examiner staff to field adjusters to a great extent. Whenever metrics drive a decision to use your own staff, the company benefits from the cost savings as well as from more controllable customer satisfaction results. One should never diminish the positive effect of taking care of customers with one's own staff.

Does your company offer a mobile claims app? If so, what are some of the functions that are improving the claims process? If not, what is your reasoning?

Gore: Allstate offers a number of mobile apps to put products and services at our customers' fingertips. You can see a list of some of them at the following link: http://www.allstate.com/mobile.aspx

Allstate Mobile offers everything from policy and claim information to accident reporting and support. Our mobile claims app recently received a “best in class” rating from Key Lime Interactive.

Allstate also has the Allstate Digital Locker, which is a mobile app that guides consumers through creating a detailed home inventory that is stored securely in a pocket and online. It allows people to upload photos, tag items, and organize by room, so all the information is stored and ready should they need to make a claim.

The availability of customer claim status as well as easy electronic connectivity to the claim handler provides customers the ability to select options, communicate, and easily get updates 24/7 on any mobile device.

Khosropur: In the residential and commercial property arena, I see the benefits of tablet and other handheld technology allowing a rapid recording of scope and measurements to a completed estimate while at the loss site. There are other small handheld devices for measurements and photos which can feed data to the laptop/tablet further reducing administrative task revolving around building the report.

How do you study the customer feedback arising from the claims process? Is social media assisting in that process?

Hlad: We survey our customers to obtain feedback on various areas of the claims process, including how likely customers are to recommend our company. We use this information to identify training opportunities, process improvements, and to increase our ability to retain our customers after they've filed a claim.

Social media currently plays a small role in this process. We monitor what customers say about us and promote the use of social media to our customers, employees, and agents through our company website.  I anticipate that social media will play an increasingly larger role in the future based on technology and customer communication preferences.

Gore: While the amount of direct comments is relatively small, this is a rapidly growing area. We are positioning ourselves to be an industry leader in the way we're available for our customers in the social media space; with rapid and appropriate responses and active listening.

Khosropur: I have not yet used social media for customer feedback. Having a focus on improving the delivery of service, I tend to survey customers specifically and privately. Regarding technology, it is important to step back and regard any dissatisfaction in service as an opportunity to examine whether the root cause of poor service stems from unnecessary burdens placed on the claim handler. Adjusters like to help people, so why are customers not pleased with the service? If the issue is timeliness in the claims process (most complaints) then is there a technological solution which can overcome this?

Stapleton: We have several survey mechanisms we utilize, but they are not automated, although the utilization email address is now with our new intake process and we are looking to automate our first party surveys. Today we do it through the mail. We get close to 20 percent participation from that. We have quarterly meetings to review those results on customer service. We are survey savvy from a manual perspective, but we have not done a good job of automating that and how best to utilize that data.

Is business process management a priority? Have you discovered any workflow improvements?

Gore: Yes, and we have seen improvements, most specifically from focusing on the customer's end-to-end experience we have been able to reduce irritants to both employees and customers enabling easier and more satisfying experiences through use of industry leading processes and technical capabilities.