• Point of view

Delighting customers with high-performing contents claims

How to get inventory creation, pricing, and fulfillment right

High-performance claims management must be designed to delight customers. At the same time, it must efficiently manage expenses and accurately assess indemnity.

Figure 1: Three key claims metrics that drive the overall health of an insurer

To achieve high-performance claims management, it's essential to have a team of trained contents specialists, efficient and well-designed processes, and robust technology.

Personal and commercial contents claims processing share two common processes:

  • Inventory creation
  • Inventory pricing and fulfillment

Getting the details of these right can deliver big pay-offs for insurers.

Inventory creation

The bedrock of all contents claims is the original inventory. If it is inaccurate or lacks detail, the entire process deteriorates and produces a less-than-ideal outcome. As a result, the customer experience suffers.

That's why a specialist should create the original inventory regardless of the size of the loss. On small losses, staff adjusters can document the first notice of loss (FNOL). For large losses, creating an accurate inventory is even more crucial – and difficult. Expecting independent adjusters to create inventories is problematic because they're hampered by time constraints and may not be properly trained. What's more, asking policyholders to take inventory can impact customer satisfaction. During the recent California wildfires, for example, many policyholders resisted having to complete total loss inventories because of the stress involved. On top of this, customers can make inaccurate assessments of indemnity.

Ask yourself if your team has the necessary training and enough time to produce accurate inventories. Deploying specialists in the field on large losses speeds up the inventory process and leads to happier customers. It will also result in more accurate indemnity, while reducing expenses by making adjusters more efficient.

As for process, having a defined process for inventory creation, based on severity and other extenuating circumstances, is essential. Carriers should formulate and commit to maps that define the inventory creation methods suited to each claim, and specify which specialists should be involved.

Meanwhile, the technology should help carriers create inventories efficiently, enabling all parties involved to collaborate in the inventory creation process. The right technology will:

  • Reduce the time to complete the inventory, meaning lower costs
  • Produce quicker turnaround and settlement times, meaning happier customers
  • Produce more accurate inventories, meaning better indemnity control

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Inventory pricing and fulfillment

Once carriers have a precise and relevant original inventory, how they evaluate, price, and help replace items will have a tremendous impact on the customer experience. At the same time, carriers must manage expenses and make sure indemnity is accurate.

Specialists can add value to inventory pricing and fulfillment, too. Today's consumers own so many personal items that it's virtually impossible to keep track of them all. Yet policyholders expect carrier representatives to know what they own. Staff adjusters have heavy workloads, however, so bringing in experts who can assist with the contents portion of a loss will dramatically improve the overall claims experience for both the adjuster and insured.

In terms of process, defining how inventory is priced, evaluated, and fulfilled is critical. Simply looking up a source and price for items no longer satisfies policyholders. A customer-centric inventory evaluation should ask the following questions:

  • Does the insured shop online?
  • Is the insured in a rural or urban setting?
  • Do past shopping patterns demonstrate the insured's preferred brands?
  • Does the insured want to have the items shipped directly to their home or business?

Technology comes in to play here as well. Contents-estimating platforms and algorithms alone don't offer a best practice approach to evaluating and pricing. Instead, adjusters and contents specialist should think of these technologies as tools in a larger toolbox that allows them to view each claim holistically, keeping in mind that the goal is to increase customer satisfaction, reduce expenses, and improve indemnity accuracy.

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Bringing it all together

Essential elements of a high-performing contents claims function include a team of specialists, well-defined processes, plus the technology to support speedy resolution and ensure customer experience is first class. It's vital to balance all of these components to achieve the best possible outcomes. Insurers can start this journey with a design thinking session to identify what already works well, areas for improvement, and how specialists, processes, and technology will come into play.

This point of view is authored by Gaurav Shahi, AVP, Insurance Practice.

Figure 2: Life cycle of a contents claim