Think like a client

In my 4th post I said I would talk about strategic communication in the claims process. 

I think you can go to pretty much any insurance conference and someone will stand up and say how important communication is. So, to start with let's look at how the dynamics have changed and how I think they will continue to change.

For anyone who has worked in the London market handling claims over the last 5 to 10 years I think the answer generally is that communication has got worse because "face to face" claims handling has been replaced largely by the electronic submission of information. 

This is a classical case of "improved" processes designed to deliver greater efficiency and record keeping eating away at the very essence of what has made the market special. Thankfully there is hope on the horizon. Dual screen technology means "face to face" will be back any time soon. This gateway will open up all sorts of opportunity for the "live" reporting of claims and involvement of all parties in the communication process.

As an insurer am I sitting comfortably with this? Gone are the days where an insurer can easily drive the process. Now I am being harassed from every angle. Everyone wants immediate answers, greater access and the whole process is subject to greater scrutiny.

Insurers spend much more time thinking about their brand and how they can get closer to their clients to improve their retention and growth rates. The effect on Insurer claims staff is that they also have to work much harder around soft skills with brokers and clients and this often leads to far more travelling which just adds another level of challenge to the claims handlers work load.

Of course the solution to make this easier for the insurer is to understand  how best to use your resources and processes recognising the value you need to deliver.

If you agree, then arguably you run two models as an insurer. The first understands those claims which are complex or large etc and require very strong technical and communication skills.

The other model recognises straightforward claims and surrounds these with slick processes.

For any Insurer who is involved in direct deal these two strategies are basically easy to adopt especially if there is no subscription market. However, if there is a broker involved along with multiple placements then it becomes a far more tricky world.

Personally, I would prefer to see London market claims handled through an FNOL and direct settlement vehicle that weeds out the straightforward and then the broker and insurer concentrate their efforts on the value add, surrounding these with their very best skills. Unfortunately at present this appears too bitter a pill for some to swallow but I do feel this change is inevitable at some stage.

Outside of the processes that effect communication I wanted in this article to look at actually what we are trying to do through the life of the claim and what this tells us we need to be communicating.

So back to basics...Clients in my experience want to know how the product they bought is working, what the issues are that they need to manage and what the likely outcome will be. What they want is "claims certainty" i.e. certainty of process. Unfortunately we cannot give them certainty their claim will be covered!

This industry often works to the opposite of this using terms and approaches that do their best to confuse the customer. Examples include the use by insurers of claims steering committees where the client does not know the mandate nor what this committee is doing. It includes also language such as the undefined use of a "reservation of rights" where in essence the insurer is just trying to keep all is options open. Great for him but what about the client?...

The introduction into the process by insurers of lawyers just adds another level of uncertainty for clients and generally adversely affects communication. However innocent an insurer might try and make the appointment of a lawyer sound the effect on a client's confidence in the process can be enormous (This is a subject for another day..).

In an effort to improve communication with clients and brokers a number of insurers now use client relationship managers. In the claims process people who perform this role need to be very careful because if they are not claims practitioners they have a very good chance of misleading the very people they are trying to improve communication for. Personally, I would use the money to improve the communication skills of my claims handlers...I have seen companies like Swiss Re do this to great effect.

So bearing all of the above in mind my high level strategic approach for claims communication contains the following basics:-

1. Understand what is critical to your client in the claims process

2. Align your staff and processes (especially measurement) around delivery of what clients need

3. Create some base principles that outline what will happen in the claims    process and share these with clients at the outset

4. If you employ third parties in the process make sure they understand your brand and delivery requirements. Make some of their reward based on delivery against your goals. If successful the cost will be covered by improved growth and retention

5. Aim to over communicate, you will soon find out what level of communication your client wants

6. Always try to take post claims resolution feedback to find out how you and the other parties you may have employed in the process performed. Use this information to improve your offering

There will those amongst the audience of this post that say they cannot get close to the claimant because there is a broker in the way. This is actually a fallacy and I have addressed this in 4 above. Often the loss adjuster (insurers'  representative)has as much to do with the client in the process as anyone. If insurers make an effort to ensure the adjuster is aligned to their claims handling philosophy and rewards them for delivering the communication they want then they can effectively be as close as the insurer wants them to be to the client. Unfortunately many Loss Adjusters complain that they are not paid enough so  the bit I argue insurers want managed best in the process(communication!)suffers most. Now there is food for thought!!