– July 21, 2010
Looking At The End of the Rainbow For Your Claims Satisfaction Pot Of Gold?
Is it possible to increase claim satisfaction and decrease cost at the same time? Many claim representatives say no. Some view that satisfaction is driven by the ratio of adjusters to claims – having more people to handle claims means higher satisfaction, although also higher loss adjustment expense. Some believe that higher settlement amounts result in higher satisfaction and higher loss costs.
There is some truth to these views. If having more people means that estimates are completed earlier, calls are answered instead of going to voicemail, and checks are issued faster, then satisfaction will likely increase. If the higher settlement amount meets, but not necessarily exceeds, previously set expectations, higher satisfaction may result.
Drivers of Customer Satisfaction In Claims
But is hiring more people or paying higher settlements required to increase satisfaction? Let’s look at some of the key drivers of claim satisfaction from the JD Powers survey:
- Expressing genuine concern
- Ensuring customer is at ease with the claims process
- Giving customers a time line and meeting it
- Providing flexible appraisal appointments
- Answering all customer questions
- Managing expectations regarding the settlement
- Returning phone calls
- Sharing information between representatives
- Providing proactive updates
- Avoiding negotiated settlements
Communication and Reducing Cycle Times Are Keys
Communication and cycle time are the key themes among these attributes. Reduced cycle time generally results in lower costs for most industries. And, there are many ways to improve communication in the claim process that can also reduce cost. Take, for example, claim status. In many companies the process goes something like this:
- Customer calls agent to inquire about claim status
- Agent calls claim adjuster because he or she can’t access that information in the system
- Agent calls customer
This is a simplified process that doesn’t reflect the phone tag that usually occurs. Still, a minimum of three calls are required to answer a question that might have been answered on the first call. Better yet, if the information were available online, no calls would have been required, saving agency and claim adjuster time as well as telephony costs.
There are many other examples of ways to reduce cost and improve customer satisfaction at the same time:
- Automated email or voice updates on claim status to minimize inquiry calls
- Expanded capacity in drive-in claim centers to reduce usage of field adjusters, a more expensive and lower satisfaction option
- Earlier identification of total losses, typically a low satisfaction claim, to reduce storage and rental costs and overall cycle time
- Work load balancing across claim offices to ensure timelier claim handling and increase staff utilization
- Increased usage of non-exempt staff for inquiry calls as well as back-office functions to free up adjusters for more complex issues
- Automation of any part of the claim process that results in reduced cycle time for the customer and reduced adjuster time
Clearly, having the right level of staffing and meeting customer expectations regarding settlement are important to maintaining or improving customer satisfaction. But hiring more people or paying more than required will not necessarily increase satisfaction unless the fundamental communication and cycle time requirements are met. Insurers would be better off focusing first on those opportunities that improve customer satisfaction and reduce cost at the same time – creating a “win-win” – as opposed to throwing money at a satisfaction goal, with negligible economic benefit.
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This is an outstanding article. One additional thing I would suggest is the proper training for personnel. With the ever increasing use of claim central in office operations, the experience level has dropped significantly from the use of experienced field personnel.
I constantly hear complaints from experienced adjusters on our site extremely frustrated with staff in office adjusters critiquing their field estimates and requiring estimate changes that don’t even make sense due to their lack of understanding.
One example you can’t ever forget is an in office adjuster calling the field adjuster and telling them to remove the finish carpentry item crown molding because mold is not covered under the policy!
Things like this are a constant these days and do nothing but delay a reasonable settlement with the insured.
This article is very well done. Often times problems arising with claims satisfaction are easily settled by creating a connection with the client so that they feel engaged and that their concerns have some level of worth with the company that they’re filing the claim. The shortening of the claims cycle is one effort that can be achieved by being organized.
This allows the agent working on the claim to focus on the issue rather than having work toil over paperwork to keep up to date on their client’s claim. We often spend time working with different ClearRisk clients to show them how having all of their information better organized will allow them to cut their claims cycle and allow them to focus more on their client relations.
Melissa Loew clearly understands excellence in Claim Service from both the frontline and the corner office. This is fresh and valuable thinking for anyone responsible for Claim service delivery.