– January 12, 2011
I hear it time and time again from colleagues all over the industry. With cutbacks many are being asked to do more with less.
This trend began several years ago as more technology was implemented into insurance companies. Gone were the support staff; why were they needed when the claims professional could do it all on their own lap-top. Gone were supporting groups like subrogation departments and litigation management assistance; why were they needed when new systems could manage it all.
More efficiency meant more time to do more work. Certainly this will translate to better results…I mean it’s supposed to right? But has it really?
I’m Not Going To Take It Anymore
The claims industry is at a crossroads and needs to change. I know you have heard this one before, but when speaking with people in the business I was reminded me of the famous scene from the movie Network where the anchorman screams out “I’m mad as hell and I’m not going to take it any more”. Check out the clip below to be reminded.
In a recent discussion that I posted on LinkedIn, I asked the question, How do you keep the claims department from become stale? (see prior posting Is your claims department becoming a bus company?). For some reason after seven months of posting I received a flurry of comments on how the industry is facing a crisis of staffing and turnover. Quoting one post on LinkedIn from John M. Beringer:
“A sad fact is the majority of adjusters rarely last for five years. That is not due to a lack of skill or commitment; it has to do with how their pending is counted, the layered management reporting; unrealistic expectations of claims management and management by edict rather than training and critical reasoning.”
While there were many wonderful responses to my question, the general feeling was that case loads have crept too high and there is a lack of emphasis on training and development. We as claims people have a knack for complaining about caseloads, however, this one is truly one that needs to be addressed. With more technology came more expectations for claims professionals to take on more administrative tasks. Departments contracted, and claim counts rose. In my opinion this resulted in an increase in indemnity and expenses (I wish I had the data to support this, but can only i have seen it the file reviews i have conducted over the past year).
In order to excel in this marketplace, claims departments will need to innovate and attract, and maintain, new talent. Unfortunately, we are not an industry that accepts change easily, and for the most part innovation, is slow and not encouraged.
Change Requires Innovation To Be Encouraged
I have quoted Serth Godin before and will continue to do so especially with pearls of wisdom like this:
“That’s not the way we do things around here
Please don’t underestimate how powerful this sentence is. When you say this to a colleague, a new hire, a student or a freelancer, you’ve established a powerful norm, one that they will be hesitant to challenge. This might be exactly what you were hoping for, but if your goal is to encourage innovation, you blew it.”
In my consulting practice (Lanzko Consulting) I am often confronted with clients that say something like “That’s not the way we do thing around here” or, more likely, “that’s how we have always done it.” Change in claims cannot happen unless the organization looks at, and breaks, the old habit of accepting the status quo. Challenging the norm has to become the new norm. Industry executives have known for years about the declining talent pool and that need for changes, yet they have taken few steps to modernize the technology, as well as the process.
Technology is a great tool, but it will never substitute the skills of a talented claims professional. Technology must be implemented into the process to assist, not hinder, claims professionals. We need to move back to a time when claims professionals can be claims professionals. We need to make the job as interesting as it can be, and not purely about automation. Without this, the profession will struggle to attract talented people to its ranks and will certainly cost companies far more in the future.