Another way of making your business customer-centric is to Improve customer
satisfaction by optimizing your claims processes. Claims settlement is not only the largest cost-driver for an insurance company, it is a critical factor in your customers’ perception of, and level of satisfaction with, your company.
Recent research from Celent underlines a fact that probably won’t surprise you: customers who register a claim are much more likely to change insurance providers. Another interesting finding has to do with the balance between fraud management and prompt payments. Customer satisfaction is clearly linked to the speed and value of settlement. However, in order to settle quickly (or flag as fraud), each case must be processed at the right level of detail.
Naturally, an accurate claim paid quickly is best for all parties – in theory. Your customers feel positive about your brand and – as long as the claim is accurate – your organization benefits by getting it taken care of as quickly as possible, as well. Yet as you well know, it is not possible to process every claim quickly and still maintain a viable business. Your customers may not like negotiating the value of the claim or having it disputed, but the fact is that for whatever reason, some of them feel the
need to inflate its value.
How to balance fraud management with prompt claims settlement
A customer-centric framework allows you to reduce resources while still feeling confident about your decisions. It uses customer data and a scorecard system to balance fraud management with
prompt settlements. The majority of your claims are handled by the system automatically and promptly via direct processing, while others require human interaction. The rules set up in your insurance solution allow you to automate some claims and flag others based on a solid foundation of customer data. You use the data to set up a process for fully automating
straightforward claims and marking others for possible fraud.
The faster you settle, the more satisfied your customer will be. What’s more, satisfied customers have less of a tendency to make additional claims. Even more importantly, you can capitalize on this expected satisfaction by carrying out a courtesy call. What is more, as the caller has naturally prepared for the call by doing a white space analysis or even been given a “next-best product” suggestion by the system, this is a golden opportunity to upsell or cross-sell to this customer.
1. Customer data
A framework based on the customer’s own input of data facilitates a system for balancing fraud management with prompt claims settlement. This allows for the possibility of the customer entering
their claim via a self-service area on your website. It is, however, important to note that some customers do prefer to initiate their claim via personal contact on the phone. So, they should also have that option. Whether the initiation of the claim process is completely automated or involves human contact at the start, however, the actual processing can be automated. This saves time and reduces the amount of resources used on this task.
2. Scorecard system
Whereas the input of customer data represents one part of the framework, the other part is based on your own professional guidelines. A scorecard system is used for flagging possible fraud when
a certain threshold is reached. This scorecard system can be a “simple” rules-based system where a number of rules are defined. If these rules are violated, the claim pops up as a “referral.” The rules are typically defined based on a combination of statistics and the expert input of very experienced claims handlers.
The other solution is a scorecard that uses historical claims data to predict the likelihood that a given claim case is fraudulent. Here you set the threshold values for when a claim is acceptable (in this case, straight-through processing for automatic claims settlement can potentially be used), when it should be referred for further investigation/information, or when it is a potential case of fraud.