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Claims Departments Focused on Customer Retention: Survey

Why the "moment of truth" for a policyholder-carrier relationship is even more important today.

After the financial crisis, many insurance companies instructed their claims department to focus on stopping claims leakage to control costs and build reserves. But now, claims departments are focused on encouraging customer retention through exemplary service, finds software company Trillium in its 2013 claims survey, the results of which were released this week.

The survey of 50 insurance claims professionals found that their top priority was to "Monitor, evaluate, and improve adjuster interaction with customers," with more than 80% of the vote. "Reduce cycle time" and "Leverage customer service metrics to improve claims performance" were the next-highest ranked priorities. (Respondents were asked to pick a top three).

"The focus is now shifting to how do we expand and retain customers that we have," says Timothy Kosinski, director of product management at Trillium Software. "It's really up to the claims handlers to ensure that customer is pleased with what their experience."

The biggest obstacles identified by survey respondents to responding to customer needs were "Lack of communication on claims process," "Disagreement on claims decision" and "Lack of returned phone call." Kosinski says that effectively collecting and analyzing data on customer interactions can help mitigate these issues.

[Inside Amica's winning claims experience]

"You can leverage data to see whos saying what and how they're behaving," he says. "It's that type of surgical approach -- putting a focus on bits and pieces of the process, that's really in the data. You can use this for training opportunities and find a way to measure better outcomes."

Claims departments are at varying levels of data and analytics maturity, and Kosinski says that a lot of the traditional uses -- such as identifying problematics or easy-to-resolve claims early -- go a long way toward a smooth customer experience as well. But, he says, "insurers have reached the limit of what they can do with structured data." Now it's about leveraging unstructured data in claims notes to find hidden items that are impacting customer experience.

"You can back into outcomes and identify problem areas earlier," he says. "Something like a bad outcome and a non-renewal for an auto insurance customer who's not at fault. That constant monitoring is what's going to get insurers to the next level."

The survey also asked if claims departments were sharing data with other units of the company. Underwriting and marketing were the most-reported departments with which claims collaborates.

"We find that claims is really the epicenter of data and should be used as an asset," says Michael Chochrek, Trillium's insurance solutions principal consultant.

Nathan Golia is senior editor of Insurance & Technology. He joined the publication in 2010 as associate editor and covers all aspects of the nexus between insurance and information technology, including mobility, distribution, core systems, customer interaction, and risk ... View Full Bio

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User Rank: Author
4/29/2014 | 6:58:40 PM
re: Claims Departments Focused on Customer Retention: Survey
That's some great advice, Robert. While insurers have to master the step of capturing and using data, they also have to remember the simple basics of good customer service. Making the extra effort to help customers feel comfortable when they're in a tough spot can certainly go a long way in retaining policyholders.
Nathan Golia
Nathan Golia,
User Rank: Author
4/29/2014 | 5:27:25 PM
re: Claims Departments Focused on Customer Retention: Survey
Thanks Robert. I bet a lot of people would just appreciate a little empathy from their claims servicers. Even if you have to deliver bad news that can be done in a tactful way. Maybe the answer to the problem isn't necessarily a tech initiative, but you never know!
User Rank: Apprentice
4/29/2014 | 2:27:57 PM
re: Claims Departments Focused on Customer Retention: Survey
I remember when I was early in my claims career and the now CEO of a large company said something very simple. I have heard this many times since but it truly is important and is something that goes very far. A smile over the phone line can be felt 1000 miles away. It can be very difficult at times with the volume of claims for this smile to come through. However, in this day and age of the internet and companies fiercely fighting for business, it is more important than ever to provide excellent customer service and go above and beyond. To be able to capture metrics is increasingly important as well. To take that a step further, it is not good enough to just capture the data. That is only the first step. It is using that data as a tool to teach, learn, and enhance what is going on. When a policyholder has a loss, it can be one of the scariest situations for them. They often need a little hand holding in addition to great claims service. Customer satisfaction and retention is more important than ever. It is difficult enough to get a new policy on the books. Once the policy is on the books, that smile over the phone can go a long way.
User Rank: Apprentice
4/25/2014 | 8:20:55 PM
re: Claims Departments Focused on Customer Retention: Survey
Leveraging unstructured data such as voice can help a lot in improving customer experience and agent skills. A great example of that is the real-time phone interactions heads-up display of Cogito Inc.
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