Making Claims management effective and profitable Danijela Ziser, Swiss Re, Claims Forum 2014
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Making Claims management effective and profitable
Making Claims management effective and profitableDanijela Ziser, Swiss Re, Claims Forum 2014
Danijela Ziser, Swiss Re | AIIF 2014Good morning everybody, I am Danijela Ziser and it is a pleasure for me to be here and talk about Claims. Especially about a topic that says "how to make claims management effective and profitable.
My aim today is to show that, from my perspective, claims management plays an important role in insurance companies (and I do not differentiate between insurer and reinsurer), not only in the background, but also in the entire relationship between customer and insurer.
I am pretty sure that after these two days, where we will hear a lot of interesting claims topics, we will know, how important the claims department can be and really is!
Danijela Ziser, Swiss Re | AIIF 2014I want to start with an example of a bodily injury claim. A 20-meter oak tree fell on an insureds car while passing a forest on a municipal road. Consequently the passenger suffered seriously by Paraplegia and claimed for compensation.
The question here was, how this could have happened? The reason that this old tree fell unexpectedly was a fungal infestation of the tree by a certain kind of mushroom called "Giant polypore" (Meripilus giganteus). This led to the instability of the tree and so it felt down, unfortunately in the worst moment.
We managed with our knowledge and especially our international experience and contacts to provide the needed information and have given support to the client.
So finally, when we discussed treaty renewal, the client did not only decide to stay with us, but increased our share and agreed on differential terms.The client's decision was clearly not price-driven but related to the extra-ordinary Claims management in this specific case.2
3Source: customerservice.aeDanijela Ziser, Swiss Re | AIIF 2014Danijela Ziser, Swiss Re | AIIF 2014Why I am telling you about this story? What is so special about this claim? We do not always have such a detailed look on one single claim, we mostly look after the whole portfolio, or respectively segments of a portfolio. There, we see many claims that are worse considering the severity of injuries or the amount of compensation. But this claim is still different.
It shows clearly that a good claims management can make a difference in the relationship between insured and insurer. It is not only about the price- this is one component, but at least, in most cases not the most important one. Getting support in the right moment can have a decisive effect.
To be able to influence customer's decisions, we need to catch him in his moment of truth34
Source: conversiondoktor.deDanijela Ziser, Swiss Re | AIIF 2014Are you familiar with this concept? (Marcela)A purchase decision is not only made online or offline today. Product comparison sites, social media channels, friends, TV, print, radio and many more influence our decisions and make them more complex. A stimulus in the form of a TV advertising does not necessarily lead immediately to a buying decision. Purchase decisions are prepared over a long period. Especially in the area of insurance contracts, buyers need sometimes no less than half a year to research the perfect product.Starting from a stimulus, users go to a Point of Sale (First Moment of truth)-> the insurance agent. There, the purchase is made. Unlike other products, the user experience does not follow by the foot, this will happen when the customer has a claim and the insurer is fulfilling his promise, the claims management. (e.g. not only paying the claim, but also supporting the injured person Bsp. vorher)With the Zero Moment of Truth, we see the moment in which a decision is made for a specific brand and product, even before the consumer goes to the point of sale. Having transparency throughout the Web, a consumer knows about price and product characteristics and his purchase decision is very conscious and deliberate.All these possibilities to reach the customer get more in the focus of interest, because here the insurer can create and praise their own brand. At the Zero moment of truth, the customer needs to be caught to bring profit to the company.4How to be different?Run Claims like a businessAutomationHaving the right people 5
Source: pivotalsafety.caDanijela Ziser, Swiss Re | AIIF 2014Danijela Ziser, Swiss Re | AIIF 2014We know that differentiation is key for success. And there are many possibilities to show how we are different from others e.g. segmentation, prioritisation (there will be later on a detailed speech about those topics), price, knowledge just some points to mention.Having a clear vision in these areas, the client will not look only after the price. This price sensititivity will take less room in his future decision making process.
Besides the three mentioned aspects that I will focus on, it is also significant to handle in a pro-active way, to find out, what are the client's needs exactly and how to act and react in the right way. 5
More than prompt claims paymentprovide a variety of unique, value-added services and expertise
http://www.allaboutfitnesskc.com/services/our-service/Danijela Ziser, Swiss Re | AIIF 2014So, we see, it's not only about claims payment. I agree, it is an important part, but there are much more things to think about!
We, as claims people, provide a variety of unique, value-added services and expertise. But what is behind these words? What is a value-added service? E.g. to provide our experience on many claims, meanwhile the insured is confronted only with one claim. To be able to support him in the handling, to give advice which garage, consultant or doctor may be the best. All this knowledge is a service he can use when we are fulfilling our promise- to be seen as a partner, especially in bad times.
We believe, every large claims organisation can achieve a minimum 3% efficiency gain each year on average.Efficiency needs to consider multipe components: internal costs, external costs, claims payments.
As already said, we need and want to be different! Differentiation is the key to convince the customer that you are the best in class!
And much more: we internally do not only want to be seen as the backend-function paying out claims. We want to be seen as a key part of our companies and the strategic partner for our clients, being the person of trust in the right moment- in the moment of the claim.
67ShareholderClientsStakeholdersAdjudicationLiability ManagementRetrospective SolutionsStakeholderExternal ServicesIncome/value-addNet Result = Impact OperationalEfficiencyOperating CostLegal spendInvestmentUSD mioTechnical Expertise & FocusCustomer FocusSimplification/ DisciplineRun claims like a business:Foster an entrepreneurial spirit & create impactThere are different levers to pull at different timesFOCUSDanijela Ziser, Swiss Re | AIIF 20147If we want Claims handling to be seen more than just paying out claims, it is important to have a change in the mind-set: to run claims like a business.This can help generate value and positively impact a company's bottom line.I believe, we can drive value by transforming claims from a "function" into a business
And how can we achieve that?
From my point of view, there are 3 main focus areas to continuously improve: expertise, customer focus & efficiency and leveraging these building blocks can be seen as real differentiator for our customers!
E.g. if we take "Efficiency" and compare -investment vs. cost/ -Stop vs. improve/ -Segmentation and automation- we see that we need to move further.
And for example in the customer focus, with tailor-made solutions, we strengthen the client relationship and enlarge our business.
e.g. this can mean: working with high intensity on our portfolio, including a claims segmentation having an excellent understanding of the portfolio mix ensuring the right skills working on the right tasksAutomationClaims being processed in the "old" way8Paper / E-mail Closings- Incomplete documents- Non standard formats No ackowledgement of receipt required
Manual Statements-Time consuming spreadsheet process - Lengthy agreement timecycle- Large query volumes
Delayed Payments- Inconsistent due dates- Timeline driven by reconciliation - No agreement of items payable
Danijela Ziser, Swiss Re | AIIF 2014This is the good old way of doing our daily job.-> getting claims notifications most of the time in paper-form-> do the calculations manually-> possibly having long periods to finalise transactions8AutomationClaims being processed automatically9Transaction validation- Tech account (TA) message sent early, as soon as the broker books the item - Standard data format Complete/accurate dataset
Electronic Reconciliation- Real time agreement - Technical/payment transaction linked- Team can focus on queried/ unpaid items.- Early query resolution
Faster Cashflow - Items paid 15 working days earlier- No backlogs - can focus on key items- Financial account (FA) sent as soon as payable
Danijela Ziser, Swiss Re | AIIF 2014With automated processes we try to speed up with a higher standard and therefore finally achieve a faster cashflow.9AutomationBenefits exist for all stakeholders10
Increased control and transparencySingle platform access to all marketsIncreased speed and efficiency Improved cash flow Immediate, secure and evidenced delivery of dataReduced risk What is a (re)insured looking for? Improved cash flowProcessing cost reduction Enhanced client servicing Ability to focus on value added activitiesDirect straight-through processing into any market from worldwide locations What is a broker looking fo