Webinar recap: Understanding the True Cost of Claims

It’s critical carriers understand the true cost of claims, so they retain customers, lower expenses, and make processes fit for purpose.

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We now operate in a highly competitive market with only a few, very narrow, differentiators between insurers: claims handling, reputation, and process.

We know the claim department and its services are the heartbeat of any insurance company, so we’ll start there. When assessing your claims team, it’s important to consider their understanding and expectations around customer service and claims handling. Do they understand the relationship between a poor claims experience and a customer not renewing? Do they believe in their ability to make a difference for customers? Have you provided conflict resolution training to help them manage potentially emotional, stressed, and sensitive claimants?

Carriers must invest in their people to ensure they can provide the best possible customer service to each claimant and mitigate the very real financial cost of a poor handling experience.

This experience dovetails directly into the overall reputation of an insurer. It’s important to make a distinction between brand and reputation here – an insurer can somewhat control their brand and how they’re presented to customers, but reputation is built entirely off how customers and the general public perceive them. Reputation is much harder, and costlier, to control as it involves many more factors than simply the calibre of your marketing and communications function.

Reputation is one of the critical cost factors we see many insurers failing to incorporate into their structure or manage effectively. The claims business is a people business, but as we head further into a digital era, insurers need to consider how they’ll front the costs of investing in both their people and technology to protect their reputation.

Whether it’s media monitoring, social listening, or good old-fashioned call reviews, technology can be used in many ways to understand a carrier’s true reputation and how much this is costing it in new or non-renewing customers.

Investigations of both your claims handling and reputation can help gather some key insights into whether your processes are still fit for purpose. We see claims costs blow out for carriers who haven’t evolved their claims management process for quite some time. Your people will be the first to tell you something isn’t working, followed quickly by customers who are frustrated, inconvenienced, or underwhelmed by their experience with you.

COVID-19 has forced us all to be genuinely flexible and agile, and it’s the right time for insurers to evaluate whether their existing processes actually help or hinder performance.

While the initial outlay of investigating the true cost of claims for your business might seem costly, it is far less costly than turning a blind eye to an evolving market and internal issues that are set to damage the bottom-line during renewal season.

Reach out to us today to find out how you can improve your bottom line and revitalise your business, or listen to our full webinar on this topic here.