Oct 16

Insurance Claim Process & Customer Experience Management

Often when I’m working on an initiative, there are many people who are inquisitive to find out what Business Process Management is all about, why is there so much of talk about Customer Experience Management, what techniques do I deploy, amongst several others. I endeavor my best efforts to educate them in the limited time that is made available with practical examples and case studies. Needless to say, majority of them find it promising and commend this discipline and immediately begin to reflect on how they can bring about a positive change in their organisation. The examples were well received with a constructive feedback for me to dedicate a few posts on simply articulating those examples in my blog. So, here is an example of a Claims process for a Property insurance product! Of course, I’ll also be touching on its relevance to Customer Experience Management.

A typical home insurance product would see their claim process as follows:
Customer Raises Claim > Verification & Claim Lodgment > Damage Assessment > Claim Approval / Rejection > Inform Customer

Typically, the above would be structured in an organization with various departments such as Customer Service, Claims, and Assessment. As we all know that the devil is in the detail! As we dig deeper into the process details, we will identify other important stakeholders such as Finance. What is the responsibility for these department managers? Primarily to work towards their objectives (KPI) by ensuring their team executes their tasks. The managers periodically monitor the metrics and performance of their team with a view to improve their area of responsibility. For example, a sample KPI for a Sales team could be number of insurances contracts signed while a sample KPI for the Assessment team could be the number of assessments done.

All too familiar so what’s next? A strategic decision comes forth to deploy a smarter process to streamline the claims process and enrich the customer experience. Why? Well, the reasons could be that the company is finding it difficult to scale, ineffective processes, rise in customer complaints, competition, amongst many others. Yep, I’m sure you can relate this in your organization too.

So, a project is born to weed out the problems (including root cause) and to bring about an improvement. Hopefully the project would cover the entire end to end process. Let’s not get to the infamous talk on scope creep and change requests in this post :)

In most cases, the project would have had

  • non-value added steps eliminated,
  • handover points between departments streamlined,
  • automate steps where possible, and
  • improved customer experience for claim lodging and follow up via multiple channels, and

Few companies would even develop applications supporting the latest gadgets such as tablets & smartphones across all leading manufacturers such as RIM, Google, Apple, Samsung, Nokia, etc… Companies may have considered a market research whether these would be well received by their customers too (very common in the Banking industry). Regardless, the project goes live and most likely customers embrace & appreciate the change as they are now able to track their claim process in real time via multiple channels.

Many of the organizations and individuals would be content with the above; however this is where professionals like me step in to leverage Outside-In & other techniques for an even superior Customer Experience. We like to exploit even further reduction in our internal operating costs.

A simple solution in this case was to look beyond the boundaries of a typical management made hierarchy of claims process which was supposed to be initiated by the customer contacting the company. You may say, ok – but where is the solution? Well, A dedicated team was set up whose objective was to keep abreast on external factors on an ongoing basis that can result in property damage. For example: natural disasters, vandalism, theft, etc… This dedicated team was responsible to develop relationships with various entities including regulatory bodies to continually source information. The team would analyse the information from various facets and inform the customers in advance that are likely to be affected. Well, let’s go a step further and even give them preventative steps!

That’s all theory – give me a practice example! Well, this dedicated team can source vandalism / theft reports from the local police and identify trends. Use this information to convey to your customers living in that vicinity about the recent attacks and for them to be vigilant. Also supply them with detailed preventative steps to take before getting into and out of their property. From a Customer Experience standpoint, this is exceptional as they are now being informed even before a potential event takes place. They are supplied with supporting documentation that could help them take preventative steps to protect their homes. From the insurance company standpoint, there can also be a business model incorporated into this area but that is not the focus of this post. The company with which this solution was deployed saw their number of claims dropped by a significant percent and tremendous increase in customer retention and satisfaction.

Sounds simple isn’t? Exactly, it’s all common sense! Stay tuned to my blog as I unleash several concepts to help you achieve excellence!

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