The 4 Cornerstones of a Robust Insurance Claims Process

As an insurer, it’s tough to see customers leave for what may seem like a cheaper deal. But when policyholders cancel their contracts with insurers and take their business elsewhere, it’s rarely about the money.

Here are some statistics to consider:

  • Customers complain most frequently about how their claims are handled. In a recent survey across insurers, 68% of all complaints were related to claims handling.
  • The biggest complaint consumers made was about unsatisfactory settlement offers.
  • The second-most common issue related to claim delays.
  • 42% of customers said communication was the most important factor in whether they would recommend their agent to others.
  • Over one-third of customers switch insurers within a year after a poor claims experience.

At Insuresoft, our experience has led us to conclude that when it comes to insurance claims, customer loyalty is inextricably linked to four key tenets: speed, integrity, communication, and automation.

The Need for Speed and Integrity

Tardy work or underhand conduct on the part of insurers isn’t just bad for customer satisfaction – it could also get them into legal hot water.

Unfair claims practice is when an insurer improperly avoids a claim by an insured party or attempts to reduce the size of the claim in an attempt to reduce its costs. This is illegal in many U.S. jurisdictions. According to Investopedia:

“Many states have passed unfair claims practices laws to protect insured parties from bad behavior on the part of insurers in the claims settlement process. Unfair Claims Settlement Practices Acts (UCSPA) are enforced by individual states, rather than the federal government, and vary state-by-state.”

Here’s an example of how an unfair claims practice might unfold:

The owner of a small auto-repair company insures his building and property under a commercial property policy. One day, a fire breaks out on the shop floor, causing $150,000 in damage.

His insurance company is initially unresponsive to his communication and then inexplicably delays payment. While he waits, the owner cannot repair any of the damage and his auto-repair business remains closed, resulting in him suffering a significant loss of income. Unfair claims practice laws help prevent scenarios like this one.

Communication Matters

Recent feedback from more than two million insurance customers in the U.S. took a close look at what policyholders value the most when considering their relationship with their insurers. Good communication was the number one factor that increases insurers’ Net Promoter Scores (NPSs), and poor communication was the top reason for lowering that score.

The second most factors important were:

  • Attitude (how positive, helpful, and friendly agents were)
  • Price (at 22%—about half that of communication)

Automation Brings it All Together

Insurance claims process automation software lends an array of benefits to the entire claims lifecycle. It unifies and streamlines numerous tasks, including data management, file creation, and claims resolution.

Automated claims software also allows insurance employees to leave behind the rudimentary manual effort that, too often, results in high employee attrition and dissatisfaction. By automating routine tasks, firms can get more done with fewer resources, thereby saving on costs associated with finding, hiring, training, and retaining staff.

Automated insurance claims transformation can also provide firms with a way to provide regular updates to customers and make claims processing more transparent. Policyholders can sign in to portals to view the status of their claims and get notified of updates via email or text messages.

Claims Management – the Insuresoft Way

Diamond Claims is a part of the holistic Insuresoft Diamond Platform. It can be deployed as a standalone application that readily interfaces with multiple policy systems. Using a repeatable conversion tool, legacy claims can be converted from disparate systems, including historical financials, notes, and attachments, making the data available for reporting from a single source.

With Diamond Claims, you can:

  • Auto-complete routine tasks, flagging and escalating exceptions for special handling to prevent adjusters and SIU from becoming overwhelmed.
  • Track those exceptions, noting their completion and adding auto-notes to ensure the work plan and the claim file contain the appropriate information.
  • Empower supervisors to review and manage claims, their attendant activities, and their team’s workloads more effectively.

Are you looking to process claims faster, build trust in your brand, unleash the power of automation, and enhance the all-important customer experience? Get in touch today.