Excellence in claims management

The South African short-term insurance industry is characterised by unrealised opportunities to reduce claims and operational costs and also improve customer service by enhancing core claims processes and technology.

Controlling claims costs, indemnity and operational risks is a key challenge for competitiveness and profitability. This challenge is compounded by efforts to satisfy the needs of key stakeholders such as customers, regulators, competitors and shareholders.

A large number of activities in claims processes do not add value – claim-handling time and cost is incurred unnecessarily on these activities. Many insurers are unaware of the key areas on which to target their process improvement or what best practice looks like in terms of claims technology.

Questions for the astute insurance company

  • What does a good claims operation look like, and how do you compare?
  • How can the claims operating model be improved?
  • Do you have efficient processes supported by marketing technology?
  • Are the claims processes delivering fair outcomes for customers and satisfying regulatory requirements?
  • How much claims leakage is there, where in the business is it coming from and how can it be reduced?
  • Is your claims supply chain best practice?
  • How can you deliver excellent service while keeping control of claims costs and operational costs?
  • Have you defined what good claims handling looks like and how this will be recognised and rewarded?

The answer to these questions should support the most complex claims challenges.

Ten years ago the focus of boards were more on “performance” and directing the commercial and economic fortunes of the company. Today boards concentrate on issues of “conformance”. enterprise is the disposition to engage in undertakings of risk. Business is the undertaking of risk for reward. The balance between enterprise and control has been disturbed and is likely to be further disturbed by regulatory zeal. This may in the longer term reduce returns for policy holders and lead to an increase in the cost of insurance products.

Hannes Wilken, Telesure Group Services (Pty) Ltd

Key attributes of claims management best practice

In the full article, available for download below, a summary of the key attributes of claims management best practice is provided. In this section, we outline the attributes relating to the organisation, stakeholders, cost management and efficiency. We discuss these in relation to the following

  • Operating models
  • People
  • Claims Leakage Reduction
  • Supply Chain
  • Process and controls
  • Technology
  • Regulatory and compliance
  • Customer & quality

In conclusion

Achieving claims excellence is a challenge. In times where growing the top line is becoming increasingly difficult,
 be it due to market saturation or the inability to differentiate insurance products, many insurers are adopting a new focus − a focus on controllable claims costs. To some, it is vital to the sustainability of their businesses, while it is a means to improving profitability to others. Whatever the reasons are, and despite the challenges in improving claims operations, the benefits for any insurance organisation are far reaching.

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For the full article, download it here: Download

About Femi Oke

Relentless passion for creativity and digital acumen to help a professional services firm thrive in the digital space. Femi is an individual with a rich experience on regional African knowledge, its diverse business culture and he understands the continent’s economic drive. He thrives on selfless service and lasting mutually beneficial relationships with colleagues and especially clients encountered in the course of his duties. He is creative, practical and self-motivated with business judgement in corporate, brand and strategic communications, social, digital & traditional media and executive profiling. Roles in the firm include New Media, Digital Communication, Corporate Communication, executive profiling and Brand Management execution. Working on the multi-million dollar Africa high growth market project stands out for femi; besides this, managing all KPMG’s digital communication for the World Economic Forum on Africa is another project that gives him great delight. Femi holds a Masters Degree in Global Marketing from the University of Liverpool.

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One Response to Excellence in claims management

  1. Lyssa February 18, 2016 at 8:47 am #

    It depends on the claim type, and which state you are linivg in. Most states will allow an insurer to drop you, for 2 or more non-catastrophic claims in three years. Non-cat, means, excluding storms that cause massive damage to lots of houses like hurricane ike. Most storms are NOT cat storms.However. If the weather claims are NOT cat claims, they count against you. Even in states which do not allow homeowners to cancel for claims, the insurance companies can find OTHER legal reasons to cancel you like for having unrepaired damage, or doing inspections and finding other increase in hazard issues.

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