Claims: A Leader's Perspective - Jon Cawley, NFU Mutual Insurance

The Claims sector continues to evolve and adapt in the ever-changing Insurance landscape.

I have recently interviewed a number of Claims Directors from Leading Insurance Companies, together with the leaders of several Claims Management and Supply Chain organisations, to discuss their views on various topics impacting the claims market today and potentially in the future. 

Today’s interview is with Jon Cawley – Head of Claims, NFU Mutual Insurance

• Jon has 25 years' experience in Insurance in various claims focused roles with Eagle Star, Zurich and Towergate.
• In 2017 he joined NFU Mutual from Towergate, as Head of Claims and is responsible for setting the strategy and philosophy that drives the day to day delivery of the claims service.

BACKGROUND

Q1. So going back a few years now, what initially attracted you into the world of claims?

I think actually it was around the fact that it could provide quite a lot of structure. So I came out of university, had a degree in geology and didn’t really want to work in mining or on an oil rig, so I thought I’ll have a look at something that gives me a progressive career where there’s a broad-spectrum of opportunity. I was fortunate enough to secure graduate trainee role with Commercial Union, does anyone remember them? There was the usual training in each department which was quite an eye opener for the schoolboy to see the tremendous variety of roles and opportunities - from building surveyors to claims inspector, marketing to HR, operational management, IT. It just seemed to me that there were many avenues to choose from.

When I went to the claims department for training, I think I was probably a little bit nervous assuming that it revolved around people calling to complain that their claim hasn’t been paid. Actually, within an hour or two I really took to it because it was real customers, with real problems that you need to solve for them. One of the few areas where you really do touch the customer and that really appealed to me. It’s very ‘sleeves rolled up’.

You don’t know what the next phone call will involve or what the problem’s going to be. One minute it’s a broken windscreen, the next minute it’s some poor soul whose house has burned down, or a factory has flooded, and they can’t trade. You just never know, and you’ve got to think on your feet. You’ve got to be innovative and you’ve got to be very practical and that played to my practical nature. That was the motivator, it is what I enjoyed. You never know when you go out on an investigation what you’re going to come across. That for me was the appeal for it. I found it really interesting.

Whether it’s supply and management, customer care, the financial aspects, or business redesign - it’s all there in the claims world, perhaps far more so than in other areas of insurance. 

Q2. Do you think the attraction is the same as it was when you came into the market, or do you think it’s different now?

I think we could definitely benefit from selling our wares more effectively. Do we really articulate all the opportunities that are truly within an insurance environment to graduates and to school leavers? I think it’s difficult to understand what roles and opportunities there are in Claims - you do have to see it to realise the scope it has for individuals’ careers. I think there are new elements to attract people now. The whole InsureTech digital revolution should really be attracting a broader spectrum of people, but we do need to work harder to ensure people understand how much we have to offer. It is amazing how customer demands and technology are forever changing – we have to adapt and adopt new ways of working continuously. It’s exciting – there is always something new - electric vehicles to insure and repair – autonomous vehicles – new legislation changing injury claims handling – new methodologies in property constructions and repair – the list goes on. 

Q3. I know some of the other insurers do structured undergraduate or apprenticeship schemes. Do you have anything in place like that?

Yes, we do. We take on a apprentices each year and also we have a graduate recruitment programme. We are very flexible in that we give them the opportunity to choose where they would like to go, and we find we get a much better retention rate when they have more fluidity in shaping their career. If within the first 12 months they’ve spotted an area that they absolutely love, then we will tailor their programme to suit them.

I think the programmes have developed for the better over time. They add a tremendous amount of value for us actually. We have several trainee’s and apprentices in the head office claims department working on some cutting edge projects as part of our innovation lab and they’ve really come to the fore on that. It plays to their strengths as millennials. 

Q4. Do you think the role of a claims director has changed in recent years?

I think it’s probably been changing over the last ten or twenty years. Years ago Claims Heads were very technical people who came up through the ranks. I think now people have got broader backgrounds like Waseem Malik. I think that’s the right way to go. It’s brings a focus on the broader skills required to lead a successful team supported by highly skilled technical experts - playing to strengths. The example I always use to my guys is that the claims director roles are far more like a mini CEO or like a football manager type role where the job is to build the right team to put on the pitch. We’ve got to make sure that we have hired in the right set of skilled experts. So, I think that’s probably the biggest change. I think in a way it’s probably a more collaborative environment than it has been previously. 

We have built a collaborative leadership team, that operates in an open and respectful way to ensure we achieve our objectives and support one another – but have the openness to ensure we all know where we stand. This way we are able to take on board all opinions around the table and develop cohesive, rounded strategies that we all buy into. The collaboration and working with our underwriting and actuarial colleagues is far closer now than it probably has been in the past and it’s far more collaborative as well which strengthens our business and strengthens our product offering to our customers.

Q5. Do you get involved in the claims industry forums?

Recently I was appointed to the board of the new CII Society of Claims Professionals.

It’s a great forum for carefully debating some of the industry challenges and I think one of those biggest challenges, as we all know, is hiring the right people with the right skills at the right time. I think that is one of the greatest challenges facing insurers and facing claims departments.

RECRUITMENT CHALLENGES

Q6. Why do you think that is the greatest challenge? Is it a lack of good quality people or is there a big demand, or the market’s shifted?

I think it’s all of those, Gary. You know the area far better than I do. If you’ve got the right people with the right skills, with the right behaviours and motivations, you can achieve pretty much anything you want. If you haven’t got those you really struggle to keep the pace of change and as we all know - if claims isn’t changing then it’s going backwards.

I’m sure we realise we’re in a transitional phase of old world insurance moving to a fully digitally loaded environment where everything’s far more self-servicing with high degrees of automation. We’re not developed enough yet as an industry and I’m sure there’s an enormous amount more can be developed in that space and so you have this hybrid of the recruitment challenge – new world and old world running in parallel. 

So down at the starting levels, we’re not quite in the space of wanting to recruit people who are just 100% digitally savvy and work with all the technology yet. We’re not as advanced as that yet, but we need to deliver quite a few of those skills and we’re not wholly analogue either. Those days are long gone. 

TECHNOLOGY - INNOVATION

Q7. Has NFU explored the use of robotics, data scientists and other technologies?

Absolutely. Robotics is really just automating the analogue processes and in a way that has a limited lifespan. Once we’re into a full digital AI environment and our systems are better, we won’t really need robotics as we design out many of the human decision making processes. We’ve got quite a few robotics processes under development a few implemented and they are working really well.

We have our own claims innovation hub which we didn’t have before I started. Last year we went live with motor Guidewire, the latest version and at the end of this year we’ll be rolling out the non-motor. That provides us with a really strong up-to-date core platform from which we can then run other pieces of tech alongside. 

Q8. From a claims perspective, what do you think is the greatest opportunity for insurers?

The greatest opportunity is hiring great people, training them, giving them really structured careers and helping them to enable your business. It doesn’t matter how much tech you’ve got or how much market insight you’ve got, if you haven’t got the people on the ground to really keep horizon gazing and delivering changes to your claims service ahead of the market, you’re going to be losing aren’t you?

Alongside of that, I guess you’ve got to have an innovation and tech strategy that goes with it, but certainly it will only be as good as the people you’ve got in it. You also need to have board buy-in and board agility. A board that is forward thinking, wants to invest and is happy to take a few risks on carefully selected investments is a game changer.

The blurring between personal lines and commercial is happening at pace. They all need swift responses, policies that cover everything they’ve got and covers that are flexible. 

Q9. What other initiatives are NFU involved in?

I suppose the innovation hub is our vehicle for many digital tools out there. How we move to a customer choice driven, self-service environment or AI type of environment is a key element in our future claims proposition. For example, why delay processes by sending loss adjusters out, when with customer smartphones and AI we can equip our people in the office far more effectively to resolve claims very quickly. We have also gone live with BAE Systems fraud detection system which is developed to be a unique version in the market. Essential as fraudsters are ever more sophisticated in the way they operate. 

Q10. And does that work well?

It does, yes. The innovation lab is producing some very useful improvement to service and the Netreveal system is achieving great results – we are exceeding some of our anticipated figures.

Q11. What impact do you think technology is going to have on how claims are likely to be handled in the future?

I think technology gives us work and career paths for people, so I think that’s important from an internal perspective. Greater opportunity for us to recruit different types of people with different skills and provide careers that may spin off into other industries. I think from a customer perspective it certainly will speed claims up and take out a lot of the traditional moans and groans that we get about claims, lack of communication, don’t know what’s happening next. All those things can be eradicated with the technology and we can do a lot more in the self-serve space. We are yet to see the full potential of smart assistants such as Alexa and Google. When we get into the smart assistant things, the Alexa and the Google assist –but they will revolutionise the way we live our lives and how we manage claims. They will be reporting claims before you even know you have that water leak!

Q12. What would be the attraction for someone coming to work within NFU in a claims environment?

I do feel I can speak with a little bit of authority on this having worked at some of the other companies before NFUM. It is a very different environment. It’s an environment that is fully supportive of people’s individual motivations and careers and this is what I really enjoyed about it and to be honest, why I joined. The ability to help develop people and their skills and give them opportunities to try new things in a supportive and comfortable environment is quite rare in the market. 

It’s a very different culture. Right from the top there’s an ethos that we want all of our colleagues to succeed. That support is creating so much more opportunity for people and allows them to spread their wings and experiment. So, I think broadly speaking you have a much more flexible career here. There’s a lot of different opportunities to try different roles and learn about what you’re good at and where you want to go. It’s not as hierarchical as most organisations.

I have launched a Training and Competency development programme for the whole of claims. So each job role will have really clear training modules to help people fulfil and succeed in their given role and be able to see exactly what they need to be trained on and the modules they need to complete to progress to the next, to get the next promotion.

The other element is that we are heavily investing in claims. Guidewire we invested in, NetReveal System, BA Systems that we’ve put in, huge investments in claims and I’ve just announced a month ago a complete restructure of head office claims which is a net investment of many new roles. So we’re actually going to be expanding the head office function creating opportunity, so that we can drive the high performance in the business with the right outcome for the customer.

SUPPLY CHAIN PARTNERS

Q13. What are the key decision-making factors when looking at a new supply chain partner?

I think the usual ones everybody always talks about are price and service and of course they are factors. But I think the main one is always about ethos and philosophy. Does that particular partner supplier - do they have the right DNA to be working with our business and with our customers? Do we trust them with our organisation and our hard-won customers? Do they exhibit the right traits in the way that they treat their own staff, the way they treat their other customers?

We want to work with people who are very straightforward, very transparent and support our brand values.

Q14. How do you ascertain the DNA and philosophy of an organisation you haven’t partnered with previously?

You look at who do they work with currently, who have they worked with in the past? Who do they no longer work with and why, and then getting under the skin of their organisation and talking to their staff, their employees and seeing how they’re treated and how that operates. Are they running a transparent and respectful business? Are they respectful of their customers and their clients? If they struggle to articulate that and they haven’t got very well-developed policies around Much of the decision making material is qualitative as opposed to quantitative, but it does have quite a weighting for us.

INSURETECH

Q15. In terms of different areas, like motor or home, are there more opportunities to utilise technology in one than the other?

There are opportunities in all. Even in our world, there’s opportunities right across the board from motor, home, property even livestock and pet, across the whole spectrum. I think probably the motor world is, just because it’s so vast really in terms of scale and there’s a lot of activity in there, it tends to be a bit more of a uniform process for everything. There’s some really interesting tech using video to assess if a vehicle’s a total loss or trying to estimate the vehicle repair cost just from images and AI doing all of that, and that’s absolutely brilliant and there’s some real advances in that.

The property space is probably a little bit further behind, but then again there’s a lot more variables in it. So it will take a little bit more time to evolve. It’s not quite so easy to quantify all the benefits. 

Embracing that tech in the motor space with the smart cars that are now being produced, I think it was from 2018 all manufacturers had to make them have a smart capability. I think that’s really going to change. So where is the market going to go? Are manufacturers going to start taking more control of the vehicles and what happens to them? Possibly not, because I don’t think they really want to get into the insurers space, but they may.

Do we even eradicate most of those accidents because we’re all going to be self-driving? The only restriction on that is the speed to which UK car parts turns over, so it’s probably a ten-year cycle but it gives us plenty of time to innovate and within seven or eight years probably be at 80% or 70% car part completion on that sort of stuff. You know, really exciting times. I think it’s going to move really quickly.

PERSONAL INJURY CLAIMS REFORMS

I suppose the only thing we haven’t touched on is the personal injury claims reforms. Another great opportunity for the industry to get it right. Does this sow the seed to us moving towards a world where the role of claimant lawyers really does diminish? With increasing regulation from the FCA, PRA, and various broader customer driven legislators, does a claimant really need a lawyer to represent their best interests these days?

In five years’ time, will that look very different? Can insurers be regulated correctly to represent the claimant fairly? Simplification is coming with the CiviL liabilities Act, but there must be further steps to simplify and automate. As long as we keep looking after the injured party and we’re protecting premiums in a balanced way, the changes can continue. These are interesting times and we’ve just got to be careful that the changes do not give rise to other unforeseen consequences or new entities representing claimants and taking their compensation. That is a real risk.

Right International have a proven track record of identifying and sourcing the top talent across various niches of the insurance market. If you are looking to add to your team now or in the near future, I would welcome the opportunity to help – please contact me.

If you would like to be involved in future articles, please let me know and I would welcome any feedback.

Look out for more blogs coming soon!

All the best,

Gary Pike

Founder & MD

Right International Insurance Headhunters

At Right International our specialty is sourcing the top achievers for the Insurance Market.

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