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It's said that insurance buyers never know the true value of an insurance company until they file a claim. For insurance companies, it's wise to keep that thought in mind, because the way a company treats its policyholders throughout the claim process reveals its culture and the value it places on providing customer service.
A buyer wants claims associates to treat him or her as a person, not a file number. A company should look upon its relationship with a policyholder as a partnership. Both sides take a risk. What the insured buys is protection. It's up to the claims department to provide a sense of comfort and trust for the insured by building the relationship every step of the way, from the first claim filing through resolution.
Here are important features to keep in mind to provide effective claims management:
n Customer service is key. A company should provide a dedicated and competent team of claims professionals and/or attorneys who strive for excellence every day while resolving claims in a prompt, equitable and reasonable manner.
n How is a claims department managed? It's the manager's job to guide and mentor claims associates to ensure high-quality standards are met, while continually focusing on processing improvements and professional enhancement. A manager should foster a culture of quality and service and an atmosphere in which the staff can be innovative, creative and strive for better ways to assist their insureds.
Good management means ensuring a department has adequate staffing levels, reasonable workloads and the necessary tools for associates to handle their claims. It also includes a system of checks and balances to ascertain that there is adequate time for management to review claim files.
n How much experience do staff members hold in the field of the product lines they handle, such as health care or engineering? The person handling a claim should be able to relate to and understand an insured's unique professional needs. Long-term staff associates with the company most likely possess a great deal of experience.
n Personalized attention. It's important for a claim representative to build a relationship with the insured and communicate effectively about the claim process and whatever options are available. Since accidents happen despite the expert skills, best judgments and painstaking precautions of its insureds, the staff may need to do a lot of handholding. But since we live in an imperfect world, it's not unusual to see cases against companies and professionals who didn't do anything wrong.
Plaintiff lawyers may have only a limited obligation to investigate a client's story and suits are sometimes filed with incomplete or incorrect information. A claim strikes at a company's, or person's (in professional liability cases), reputation. Whether or not the insured is held liable, a claim made against a professional attacks his/her skills or judgment, which can deal a real blow to that person's reputation and financial stability, and could potentially lead to disciplinary action.
n The department must embrace new technology and use it effectively to improve claim-handling efficiency and strengthen processes. In our office, for example, our computer system immediately and automatically acknowledges receipt of a claim and provides the policyholder with the name of the person in charge of servicing their claim.
n Who handles mediations, lawsuits and court proceedings? The firms an insurance company associates with should provide reputable, competent and responsive independent adjusters and/or defense counsel who understand its product lines. Our partner firms know our lines and can handle any claims. And our claims specialists and counsel are always just a phone call away.
For insurance buyers, it's bad business to trust their reputations, or that of their companies, to an insurance company that is less than the best. For insurers, it's important to consider that perspective.
Paula Francis and Abe Drayer are vps of claim management at Shand Morahan & Co. Inc., the Deerfield, Ill., based managing general underwriter for Evanston Insurance Co. and a wholly owned subsidiary of Markel Corp.