April 24, 2014

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.

ABOUT THE AUTHOR
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, ...