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Does Hiring More Staff Improve Claims? How To Know When The Time Is Right

The Age Old Question: If I Add More Resources Will It Solve The Problem?

Alright, maybe the above is a little exaggerated, but it did remind me of how difficult the question of hiring more staff is. Whether it’s today’s or any economy, the decision to bring on more staff is one that needs to be watched closely.  Often there is a knee-jerk reaction that taking on additional staff will solve problems and improve your operations. As Dilbert points out so well, hiring more does not always solve the problem. As I wrote about in With old claims systems come old claims processes – You can’t change one without the other!, knowing what you have in place first is important before making an investment on more. This is true with staffing as it is with claims systems.

Before you bring on more staff review your staffing model, see if there any trends affecting file loads and take a quick look inward at your operation. Once these assessments are completed, you will be in a better position to know if hiring is the right decision.

What – No Staffing Model? Here Are Suggestions For Creating One

Having a staffing model will allow you to objectively look at your operation and help determine if it’s a good time to hire more staff. How do you know what model to choose? Here are 3 suggestions for creating one:

  • What kind of organization are you? Are you highly technical with low frequency, or are you in a high volume business? Are you a “touchy feely” organization that wants to be in the customers face often, or not? Understanding the strategic position of your claims organization is critical to understanding what kind of staffing model is relevant
  • Decide on a metric to develop your model: The metric you choose will help to determine the model, but will be wholly based upon the types of claims organization you are. If you are an excess carrier that is sharing risks and attaches at a high level, then you may not be concerned about the number of new claims that come in. Maybe your claims settle quickly, as in some property matters, so the number of new claims a handler receives in a month is a more critical metric. It will depend on you business and needs – come up with a number an live with it.
  • You now have the metric – test the staff and come up with the model: Once you settle on a metric, check your top performers against the new metric you have selected. How many files are they handling and still managing files within best practices? At what point does their ability to manage those files well breakdown? Take an average of the top performer’s metrics and you will have a staffing model to give you a benchmark.

Just remember that models are models and they tend to always look good on paper and in photographs – there is always the subjective that needs to be addressed. Regardless, the staffing model is a good management starting point.

So You Have A Staffing Model, How Do I know If It’s Time To Hire?

I am all for the staffing model, but sometimes it just isn’t enough to know when you hire. Don’t forget other claim metrics and trends. Is there a recent influx of claims due to a change in underwriting or because of a CAT loss? Understanding the rest of your organization is just as important when deciding to hire or not hire additional staff. Speak to your underwriters and learn if there has been some new marketing initiatives. Did they write some new account that explains an increase, or decrease, in claims frequency or severity? A blip in the numbers may be just that, a blip. Regardless, ask around and dig into your numbers to see if there is a short term explanation or whether it is the beginning of things to come.

Hold On, A Model Is Good, Knowing Current Trends Is Good, Understanding If You Really Need More Staff…..Priceless!

Even though you have the staffing model in place, and have looked at the metrics for the operation, there is more to explore before jumping in with new staff. Take a regular operational pulse of your entire organization. There is always room to look for waste and improve efficiencies. There are also ways to improve handler efficiency at a more minimal cost, as I wrote about in 2 Cost-Cutting Solutions To Get Work Done Without Overloading Claims Handlers and Cutting Costs Without Overloading The Claims Handler – Part 2 Of The Series.

Do a quick assessment of your operation and determine if there is some issue preventing claims handlers from getting their core job function completed. Maybe some older internal report that no one is using can be eliminated and free up a handler’s time.  Are they being asked to take on tasks that can be done more efficiently, and if so, what would the impact be in eliminating that task.  As organizations grow, process grows, and not always for the right reason. The potential need for more staff is a good opportunity to explore those processes.

Hiring more staff is an expensive proposition for any organization. Take time to truly explore what is needed. Once this done, and you can objectively know the need is there, then hire away.

(For good advise about hiring – check out my fellow blogger Jay D’Aprile in Talent Tracks)

What types of models does your organization use?

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  1. Tweets that mention Does Hiring More Staff Improve Claims? How To Know When The Time Is Right – The Claims SPOT -- linked to this post on May 5, 2010

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