“Customer Claims Experience” – from FNOL to digitised settlement – this should become one of the next big “innovations”
The insurance industry is well placed and even designed to respond to catastrophic claims when they occur around the world. This value is frequently demonstrated when communities and large areas are impacted by the damage caused by natural catastrophes such as hurricanes , earthquakes and wildfires. However, the insurance industry is now facing an acute challenge from COVID-19. This pandemic is not just a significant one-off event contained to one or two areas but a systemic loss causing havoc around the world, all happening at the same time , creating innumerable scenarios with an interconnected knock-on effect involving Event Cancellation, Travel , Trade Credit as well as Business Interruption through supply chains.
The claims will be significant in value as well as significant in the sheer numbers to handle. Thankfully, insurers have a solid reputation for strong balance sheets which are in most cases worthy of high Credit Ratings , however, the biggest challenge posed by COVID-19 may not be the hit to an insurers’ own results or their own Credit Rating– their financial ability to pay claims – but a hit to their Willingness to Pay claims.
Many insurers have “express claims” services and an excellent customer service culture but COVID-19 is of a different magnitude and importance. Whilst we should not forget that an insurance contract is a legal contract (and not a banking loan to be simply drawn down on and repaid over time) this is the time that insurers can really simplify the claims process to support customers at a time when liquidity is essential , not only to maintain through this crisis but to help customers accelerate the restarting of businesses.
Insurers who are truly focused on working with partners to quickly implement digital solutions to help customers experience a straightforward , efficient , helpful claims process and speedy settlement will be the winners and will “re-set” the insurance industry’s reputation post COVID-19.
The willingness and speed of claims settlements may prove to be more important than the price of an insurance policy going forward.
Mark Heath , CEO of Acies MGU a new breed of MGU driven by technology, customer experience and data insights