| Act cFluent Newsletter, November, 2005 -
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To abdicate or not to abdicate (claim handling), that is the question.
Direct reporting to carrier and restriction
of claim draft authority have led many independent agents
to remove themselves from the claim process unless presented
with a problem. A study published by management consulting
firm Accenture shows why not keeping tabs on the claim process
and not monitoring your carriers’ service can be dangerous.
Among adults filing a claim in the last 5 years:
- 94% said quick resolution was important
- 82% said being aware of the process beforehand was key
- 74% said the amount of the settlement was important
- 41% were unsatisfied with how they were kept apprised
of claim status
The proportion of clients likely to stay with
their current insurance provider and likely to refer other
customers varies by satisfaction component, but is uniformly
high – 65% to 90%. Abdicating the claim process means
abdicating control of client retention and growth through
referrals.
Very few agencies today have claim specialists and those that
do are usually focused on claim service for specialty programs
or large accounts. Most claims are handled in such a way that
the agent is the last to know what is happening with a claim.
One alternative is to require service staff to monitor the
claim progress by checking with the claimant and company at
regular intervals. This is not usually viable since the hours
in a typical account representative or CSR’s day are
pretty well filled up.
The good news is that most small claims can be easily grouped
by line of business and, once that is done, many characteristics
are homogeneous across 80% or 90% of the claims. For instance:
- Most personal automobile and homeowner claims settle
for under $10,000.
- First payment of loss happens within 7 to 10 days for
most personal auto and homeowner claims.
- The steps in the claim settlement process are generally
the same.
- The intervals between the steps in the claim process
are typically uniform.
Understanding which claims are similar and
in what ways they are similar gives an agency a chance to
set up a controllable, repeatable monitoring process that
is cost effective, ensures customer expectations are met and
maximized retention and goodwill referrals.
Remedy: Develop a process that educates customers
about the claim process and allows your agency to monitor
carrier performance so you can intervene before delays or
problems result in dissatisfaction. The claim monitoring process
you implement should also allow you to collect the data necessary
to help your carriers identify performance weaknesses and
improve them and validate your agency’s value proposition.
More information on the Accenture study at:
http://www.bettermanagement.com/library/library.aspx?libraryid=12437&pagenumber=1
View a recorded demo of the cFluent Claim Manger Tool for
Agency Websites at:
http://www.ConfluencySolutions.com/cats/cm
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Act cFluent
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