Businesses looking to maximise value and the customer experience must have a carefully planned and effective claims management process, whether handling claims in-house or using a managed service option. If not, they face buckling under the pressure of declining profitability driven by erroneous claims and loss of consumer confidence.
The efficiency of claims functions is a critical element in the value chain and proactive management allows claims to be dealt with quickly, efficiently, and fairly to help maintain indemnity costs at acceptable levels and allow businesses to develop lasting customer relationships. Reducing unnecessary claims indemnity spend – referred to as claims leakage - can have a significant impact on claims performance and in driving profitability.
The components of successful claims management
As well as delivering a positive experience to policyholders and lowering indemnity spend, an optimised claims management process can help manage risks, introduce automation, boost customer retention, and increase profits. There are some essential elements that need to be factored in:
- The right content, accuracy, and availability of data is essential in gathering insight that helps identify potential liability and claim value early, allowing more informed planning and budgeting.
- Engaging technology facilitates greater automation and the use of sophisticated management information enables claims to be settled with greater pace and accuracy, which delivers improved productivity and cost savings.
- Having suitable processes and strategies in place allows faster reaction times and safeguards the quality of response. Flexibility in using different process models can help handlers make better informed decisions by using accurate estimates, classifications, or probabilities to reduce claim cycles, improve performance, and deliver a positive brand experience.
- Engaging specialist team members who possess the right sector knowledge maintains the quality and consistency of service. With the right skills in place, handlers can take the lead on claims and ensure their efficient closure.
The importance of claims management
The effective operation of claims management is central to managing the total cost of risk and identifying market developments that can perhaps provide a competitive advantage.
Delivering a positive claims experience will build customer loyalty and enhance brand equity. A streamlined claims process involving rapid filing, assessment, and settlement will create increased customer satisfaction and promote greater retention.
The claims process is layered with complexity, with opportunity for delays accentuated by manual processes and multiple stakeholders.
Technology makes significant contributions in all these areas, with mobile apps and web portals allowing clients to file and track claims with minimum effort and claims management software moving claims quickly through the various stages of the settlement process.
Not only do customers that receive a hassle-free service represent fewer complaints, but they can also be strong brand advocates through positive reviews and recommendations. A speedy service also delivers enhanced productivity and greater abilities in managing a higher number of claims.
Detect and reduce fraudulent claims
Effective claims management will minimise the impact and costs associated with fraudulent claims. Having the knowledge and experience to identify and challenge fraudulent claims is crucial in managing spend and preserving brand integrity, both of which can be difficult to control when handling fraudulent claims or settling where there’s no liability.
A risk of rapid claims settlement is somewhat inflated or that fraudulent claims may get settled and impact profitability. Conversely, delayed payouts due to greater scrutiny can cause customer frustration, negative experiences, and lower satisfaction rates.
Systems that balance digital solutions with human analysis help identify fraudulent claims with a high degree of accuracy and mitigate their impact.
Insurance claims management systems and other digital tools can automate communication and payment tasks that might otherwise take days using traditional methods.
Increased automation means fewer people are needed, so in addition to saving time, the capacity for human error is also removed from the equation, as are the time-consuming and costly fixes sometimes needed to rectify them.
Organising and storing data effectively using claims software plays a significant role in ensuring claims management protocols are cost-effective. Handlers can access confidential data from secure locations quickly and easily to ensure the claims are processed as efficiently as possible.
Compliance with data protection regulations such as GDPR is also easier to maintain with robust internal controls and end-to-end encryption techniques that regulate access to sensitive customer information and greatly reduce the threat of theft or data loss which represent a significant reputational risk.
DWF delivers market-leading solutions that optimise the claim management process, bringing together extensive insurance market and legal expertise with superior service and award-winning software to deliver bespoke strategies that manage risk, create greater efficiencies, and drive better decision-making.
Contact Client Services Director, Archana Makol, to discuss how DWF can help your business with an optimised claims management solution.