InsuranceRescue Publications

Differentiation Through Improved Claims Processing

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In today’s insurance market with heavy advertising, value-add services and special policy features, companies must implement ways to differentiate themselves from the pack. While many insurers focus on new products and coverages, the importance of the basics is often overlooked.

One such differentiator is the value of reducing claims handling time through improved process flow and greater efficiencies. In this article we will discuss the importance of the claims process and why this cannot be overlooked in today’s competitive marketplace.

According to surveys by J.D. Power and Associates, from Q4 2011 to Q4 2012 the average time to pay a claim decreased by 2.5 days, down to 13.9 days. The average time for total loss claim payments dropped even more significantly, from 23.6 days to 18.5 days 1. You may look at these numbers and think that insurers clearly care about their claims handling time. While this is true, faster has become the new norm. In order to remain competitive, insurers must strive to stay ahead of the pack and not become complacent by simply being average.

Your customers expect and deserve to receive outstanding service and claims settlement is where it matters most. Their claim, regardless of the size, is what they have been paying premiums for and they demand fast service, timely communication and fair treatment. "Claimants' perception of fairness is more than just the amount of the settlement. Focusing on keeping claimants updated and quickly communicating what will be covered in the claim also have a major impact on their perceptions of how fairly they are treated" 2.

There are numerous means for improving claims processing times. Digital imagery offers a simple way to decrease claims handling time and improve customer status communications.

One such service provides photos and video anywhere in the United States, within 24 hours. Utilization of a high-speed service will help your company reduce the standard claim cycle by two or more days on many claim types. This improvement can be even more significant for claims outside of major metropolitan markets, where you may not have local adjusters or easily accessible independent adjusters. Specialty partners help improve settlement times and allow for faster customer status updates, thus giving them a more satisfying and transparent claim’s experience. This service is of great value to any company, but may especially be of interest to those companies downsizing claims staff.  Without adding employees our partner helps a smaller staff efficiently handle increased workloads.

By improving claim handling time, not only will your company increase profitability through reduced LAE, but also gain a marked increase in customer satisfaction resulting in better retention and improved customer perception.

  1. Martins, Carlos, February 4, 2013, “How Much Does Claims Handling Matter?”
  1. D. Power and Associates, October 29, 2012, “2012 U.S. Auto Claims Satisfaction Study”