Category Archives: Customer Service

Streamlining the First Notice of Loss (FNOL) Process: Best Practices and Technologies

Posted on by
Reply

In the fast-paced world of insurance claims, the First Notice of Loss (FNOL) process is the critical first step that can make or break the entire claims experience. It’s the moment of truth where insurers have the opportunity to set the tone for the entire claims journey. Let’s dive into some best practices and cutting-edge technologies that can help streamline this crucial process, with a special focus on the game-changing potential of customer portals.

Understanding the Importance of FNOL

The FNOL process is more than just collecting information – it’s about establishing trust, providing reassurance, and setting expectations. A smooth, efficient FNOL process can lead to:

  1. Increased customer satisfaction
  2. Faster claims resolution
  3. Reduced operational costs
  4. Improved fraud detection

Ways to Streamline the FNOL

  1. Multi-Channel Reporting Options: Offer various channels for reporting claims, including phone, web, mobile apps, and even social media. The key is to meet customers where they are, providing convenience and accessibility.
  2. Simplify the Questionnaire: Keep the initial questions simple and relevant. Collect only the essential information needed to start the claims process. Additional details can be gathered later if necessary.
  3. Implement Intelligent Routing: Use automated systems to route claims to the appropriate departments or adjusters based on the type and severity of the claim.
  4. Provide Immediate Feedback: Give customers immediate confirmation that their claim has been received and provide next steps or expectations for follow-up.
  5. Train Staff Effectively: Ensure that all staff handling FNOL are well-trained, empathetic, and capable of providing a positive customer experience.

Leveraging Technology for FNOL– The Need for a Customer Portal for Reporting

A robust customer portal that serves as a one-stop-shop for FNOL and claim management and the implementation of one should be a top priority. Here’s why it’s a game-changer:

  • Ease of Reporting: Customers can report claims at their convenience, 24/7, without waiting on hold or scheduling calls.
  • Reduced Input Errors: By integrating the portal directly with your claims system, you can implement data validation rules and pre-fill known information, significantly reducing input errors.
  • Eliminates Redundancy: Once information is entered, it flows directly into the claims system, eliminating the need for rekeying data and reducing the risk of transcription errors.
  • Decreased Need for Clerical Staff: With customers inputting data directly and accurately, the need for clerical staff to manually enter FNOL information is greatly reduced, allowing for reallocation of resources to more complex tasks.
  • Real-Time Updates: Customers can track the progress of their claim in real-time, reducing follow-up calls and improving satisfaction.

Other Key Technologies to Improve FNOL Reporting

  1. Mobile Apps with Photo/Video Capabilities Develop user-friendly mobile apps that sync with the customer portal, allowing customers to submit photos or videos of damage, streamlining the information gathering process.
  2. Natural Language Processing (NLP) Utilize NLP technology to analyze written claim reports submitted through the portal, extracting key information automatically and reducing manual data entry.
  3. Predictive Analytics Implement predictive models to assess the potential severity and complexity of a claim at the FNOL stage, allowing for better resource allocation.

Case Study: InsurTech Success Story

Consider the case of Lemonade, a disruptor in the insurance industry. 98 % of all FNOL for Lemonade is being handled by their bot – AI Jim.  Lemonade has also reported a 25 percent productivity benefit achieved in three years’ time, and indemnity payouts reduced by 3-5 percent for day-to-day claims and up to 14 percent for large verdicts, as well as a 10 percent drop in legal spend.  (Lemonade Exec: AI Getting the Right Claims to the Right Adjuster)

Looking Ahead

The key to success in streamlining FNOL lies in balancing technology with the human touch. While automation and self-service portals can significantly improve efficiency, it’s crucial to maintain the option for human interaction, especially for complex claims or distressed customers.

By implementing these best practices and leveraging cutting-edge technologies, particularly robust customer portals, insurers can transform the FNOL process from a necessary administrative task into a powerful tool for customer satisfaction and operational efficiency. The reduction in input errors, elimination of redundancy, and decreased need for clerical staff not only cut costs but also pave the way for a more streamlined, accurate, and customer-friendly claims process.

What strategies has your organization implemented to streamline the FNOL process? Have you seen success with customer portals? Share your experiences in the comments below!

5 Business Basics Every Claims Person Should Live By

Posted on by
5

Going back to the basics is a great way to manage the pressures of claims

I have often advocated here that business ideas can come from outside the insurance industry and adopted by claims very easily.  It’s a matter of taking the time to look at what is out there. As we all know, claims folks have little time to look and that is where I hope the Claims SPOT can help. Sometimes claims organizations get so involved in the day-to-day that they have little time do the basics. Common sense practical business practices are easily forgotten when you just set up your 10th claim of the week and you have two other claims going to trial.

Donna Flagg, writing for the Huffington Post, recently posted an article, Five Things They Don’t Teach You in Business School.  This wonderful list of common sense no no’s couldn’t be more applicable in claims organizations.  I have followed Donna’s list below with comments on how they apply to our wonderful world of claims.

  1. Don’t yell at people. Flying off the handle does little to affect the other person(s) in anything other than a negative way, but instead, it makes you look crazy and unable to handle pressure.

    2. TCS: Claims can be a pressure packed world, and maintaining control is critical to success. Keeping your cool in a negotiation, or even when the paper work just keeps piling up, will help you achieve the best results. If you feel yourself loosing a little control, get up and take a walk or grab a drink of water.  Diffuse the issue before it becomes an issue and reflect poorly on you.

  2. Don’t lie in the presence of others. They will figure out that you either do not tell the truth, or selectively tell the truth when it suits you and they will doubt your authenticity as a result. You will end up with people who don’t take you seriously and keep you at arm’s length because you make them feel unsafe and uncomfortable.

    3. TCS: Lying in claims is the surest way to an early exit in this industry. The claims department is responsible for paying out significant amounts of company assets and the utmost integrity and honesty is an absolute.  Mistakes happen so come clean and don’t try and cover it up or bend the truth.

  3. Don’t tell someone something “in confidence” that you swore to someone else you would keep under wraps. All it does is show firsthand that you can’t be trusted with confidential information, which is definitely not a promotable quality.

    4. TCS: This is especially true in claims when much of the information contained in a claim file is provided in confidence.  It may seem innocent to discuss the details of someone’s claim, but that information is confidential and must be maintained as private.

    Ask yourself, if it was your claim and it involved personal information about your life, would you want it disclosed to others not involved in handling that matter?

  4. Don’t be negative and lower yourself to childish, irrelevant, gossipy games. Rise above it and stay focused on the business, not the bulls**t.

    5. TCS: I hate to say this, but I have seen this so often in claims. Most claims offices have staff seated in cubicles and tight spaces.  It’s very easy to know what is going on in the cube next to you and loose focus on what is truly important.

    As a manager I had a claims person come up to me and complain that “so and so” leaves the office early. I informed her that the person actually gets to the office earlier, stays focused on her work only, and was extremely productive. The one complaining, as is usually the case, was one of the least productive professionals in the office. Had she spent as much time worrying about getting her own work done instead of worrying about other then she might have excelled.  Trust me, your managers know who plays the games and who does the work.

    We all know this person so don’t become one.

  5. Don’t ignore people who need a response. It’s like playing a game of catch; if you don’t throw the ball back to the person who threw it, everyone just stands around waiting. Not a good business model. Not a good reputation builder. Not a good choice.

    6. TCS: One of the biggest customer complaints against claims departments is failing to timely respond to inquiries.  I have also heard this from attorney’s who complain that they can never get the claims professional to call them back.  I know I hate it when I am waiting on a response, which is one of the most common things I have to deal with as a consultant. For someone trying to grow a business it is tough enough, in claims it is almost always going to result in higher costs.

    Counsel looking to make decisions, customers who feel neglected, or a claimant who decides to hire an attorney because they can’t get a call back are all real examples where costs will increase because of a failure to respond.  The bottom line is make time to call people back within 24 hours of a call. It’s sometimes a hard goal to achieve, but will save you aggravation,  money and time in the long run.

There are plenty more business basics where these came from, but I liked this list.

Common sense is sometimes hard to achieve when the pressures of mounting claim files take over your working life. Like in sports, focusing on the fundamentals will always be a good path to success.

What are some other basics claims professionals should live by?

Why Can’t We All Get Along? Making The Agent A Partner In The Claims Process

Posted on by
2

Working together to create a strategic advantage through improved agent carrier relations

The relationship between claim adjusters and agents can be an adversarial one.  Each side often finds itself correcting issues created by the other side.  Agents may set the wrong coverage expectation for a customer, leaving the adjuster to deliver the bad news.  Adjusters may get overloaded and not return phone calls in a timely manner, resulting in a complaint to the agent’s office.  In the worst case scenario, adjusters and agents may badmouth each other to customers, putting customers in the middle.

Aligning incentives to help agents and adjuster work to the same goal

Adjusters and agents work for the same company and should have the same overall goals – right?  Not always.

Some agents want to keep their customers (and commissions) at all costs, even if that means covering a claim that shouldn’t be covered or paying more than what is owed.  Adjusters want to retain customers, too, because fewer customers means fewer claims and ultimately, fewer adjusters.  However, losing a customer doesn’t result in an immediate reduction of income for an adjuster as it does for an agent.   And, many companies place a stronger emphasis on claims process compliance – opening practices, estimating accuracy, etc., than on customer satisfaction.  Too many inappropriately paid claims can result in an adjuster losing his or her job altogether.

Efforts can be made to better align goals and incentives such as incorporating a loss ratio component into agent bonuses and placing a stronger emphasis on customer satisfaction in adjuster measurement and compensation.  These tactics help.  But, due to their relative roles in the organization, some tension between adjusters and agents may be inevitable.

Use the customer’s expectation to work with agents to help the claim process

Therefore, should agents be involved in the claim process at all?  Most customers understand the difference between agents and adjusters and don’t expect agents to handle their claim.  But, as long as customers buy insurance through agents and pay them a commission, they will expect them to be involved, at a minimum, to explain their policy and to serve as their advocate if claim issues arise.  Equipping agents to meet these expectations through training on policy coverage and access to claim status information can go a long way toward preventing or resolving potential issues.  And, by meeting customer expectations, agents can help improve claim satisfaction.

Agency staff and locations can give claims an advantage with customers

In addition to meeting basic customer expectations, are there ways for agents to actually help the claim department?  In my recent blog post Increasing Claim Satisfaction Doesn’t Mean Increasing Staff, I mentioned the cost and customer satisfaction benefits of enabling agents to answer claim status inquiry calls, instead of referring them to the adjuster.  There are other ways to leverage agents in the claim process.  Agencies are often the first place customers go when they have a claim.  Having the claim reporting application at the agent’s fingertips to take a complete report and get the claim started reduces hand-offs for the customer and saves time for claims.  For small claims with clear coverage, there is an opportunity for agents to settle the claim, within specific guidelines.

There are particular customers and claim types where the agency role is more critical.  When a customer speaks a foreign language, especially one other than Spanish, agency staff may have capabilities the claim department doesn’t.  Customers will likely have a better experience speaking in their own language directly to an agent versus going through a translation service paid for by claims.  The elderly customer who needs special assistance is another example of a customer type that may benefit from agency involvement in the claim process.

The agency relationship and proximity to the customer are also important for large, individual losses and catastrophe claims.  In-person empathy and “hand-holding” can be highly valued in these situations.  But the agent’s proximity to the customer provides another advantage.  In the era of claim centralization, where offices are closing and more work is done over the phone, agencies provide a point of presence in the community.  During hurricanes, when phone lines are down and people are scattered due to evacuations, agents can take claim reports and issue payments for temporary living expenses until adjusters arrive on site.

Clearly, agencies have a role to play in the claim process.  Enabling agents and their staff to perform their role efficiently with empathy and professionalism can benefit customers, agents, and the claims department.

What has been your experience with agencies?  What role do you think agencies should play in the claim process?

Increasing Claims Satisfaction Doesn’t Mean Increasing Staff

Posted on by
5

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:

  1. Customer calls agent to inquire about claim status
  2. Agent calls claim adjuster because he or she can’t access that information in the system
  3. 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.

How do you increase satisfaction without increasing staff?

Better claim reports can help improve producer/carrier communications (take our poll)

Posted on by
Reply

Why do producers feel it’s like talking through tin cans when communicating with carriers?

Sam Friedman, National Underwriter Editor-in-Chief, recently wrote in his blog (A View From the Press Box) about the need for carriers to improve communications with Producers. Mr. Friedman was discussing the Producer Satisfaction Survey of 1,596 qualified agents and brokers by Deloitte’s Insurance Industry Group—conducted in partnership with National Underwriter (read more at Producers Seek More Input).  Improved producer carrier relationships can be a competitive advantage to help increase profitability in tough economic times. According to the survey, a key differentiator for carriers to attract more business from their producers is in the areas of claims handling and technology.

I believe that there are two areas in claims that add to communication breakdowns:

  • Poor technology creating limitations
  • Failing to use existing technology

Most modern claims systems can create automated customized reports. Producers should be able to ask for specific reports and have them electronically scheduled for delivery. If a carrier cannot provide this service it is because their technology is not up to speed or is not being used correctly. The reality is most claims departments fail to use their existing claims systems to their fullest capabilities. At the very least automated reporting should be available to include regular loss runs and trending reports, as well as notification of significant claim events. Often all you need to do is just ask for what you want.

There are of course many steps that can enhance producer/carrier relationship as it relates to claims. From the carrier side, producers assisting in getting information from insureds, promptly reporting losses and helping with deductible issues are just a few. Carriers can work with producers to provide prompt detailed reports which will benefit both parties through improved risk selections and better underwriting.

Suggested steps:

  • Agree on a suite of basic reports to provide producers monthly including loss runs and overall summary metrics that can show loss trends
  • Establish an agreed upon significant claim event report (reserve change, trial date, discovery deadlines, etc.) for prompt notifications
  • Automate reports to run and send on regular intervals

Better reporting will go a long way to improving relationships, and can only help increase profitability and enhance service to the policy holders.

························································································································································

Help us learn more by answering our poll:

[poll id=”3″]

[poll id=”2″]