Graham Newman, European Product Marketing Manager, FINEOS
Insurers that operate in multiple countries face a common set of challenges when it comes to defining and running their operations across different areas of the world that may have varying legislative frameworks, not to mention widely differing customs and practices. Claims operations face their own specific problems as it is at this point when speed, sensitivity and reactiveness is most required. As Neil Allcroft of Crawford & Company said at the FINEOS London Market Claims Summit in November last year: “When you sell your underwriting product to a client or end user, you make a promise to look after them in their time of stress. Be it volume or catastrophe. The infrastructure you have has to be able to meet that promise”. Those are the key words: “time of stress”. The claims operation has to deal with a great variety of conditions yet still be efficient and reflect the ethos of the underwriter.
So, just how feasible or desirable is it to build a global claims operation? To what extent can we really call a multi-region claims operation a ‘global’ one? Do the demands of local and regional requirements make this impossible? I’d like to take a closer look in this blog at the challenges and imperatives of building a global claims operation, to see what priorities the London Market places on its responses and how this helps to differentiate it in the global market.
The challenges include the efficiency and responsiveness of a remote claims operation. Typically in any reasonably sized market you will need people on the ground – at the very least to handle claim notification and the early stages. Even if the greater detail of the claim handling is right back to London then local resources will undoubtedly be necessary when the claim gets complicated, and negotiations and investigations arise. Allied with that is the fact that the claims operation represents the insurer, so certain standards of engagement and delivery, or what we might simply call ‘customer service’ are important to get right and reach minimum corporate standards, so oversight and direction is vital. However, it is also important to operate within a local milieu so procedures may have to differ slightly in different places. A local, on-the-ground operation is certainly required but simply outsourcing this to a local firm brings its own problems. As Neil Allcroft elaborated at the FINEOS Summit: “You cannot simply outsource claims, you have to have local knowledge and people on the ground, as those people will deliver commercialism to your business”.
Language is also an issue. The British, as we know, like the Dutch and the Swiss, are all fluent multi-linguists, (Ah-hem!), but how much of an issue is it dealing with multiple languages? Does the ubiquity of English eliminate the problem altogether? After all, although your agents in other lands may be fluent, their customers may not be and there may be local requirements for documentation and evidence in local languages. In such situations it is essential to have some elements of the operation at the sharp end who can engage not only in the local language but are aware of customs and practices that might influence the sensitivity with which a claims investigation operates.
From the views raised during the panel discussions at the FINEOS Claims Summit it appears that the ability to use local resources is vital. The underwriter must ensure that their ethos and brand are well represented so where the market and the claims volume are large enough to sustain it then a local office within the parent organisation will enable the best claims delivery. Failing that the ability to send in staff to more remote areas is a must. At the Summit Malcolm Beane, advisor to the London Market Association said staff had to be given responsibility and ownership of the plans if they were to be sustainable. The move to a global claims business could not be achieved without ensuring that the staff tasked with representing organisations across the world were fully engaged in what the company is trying to achieve.
This all clearly adds to the essential appeal of the London Market: that it has the highest level of technical expertise available, but it seems that not all are making the best of this. Kiln Claims Manager, Guy Hilllyard said, “At present brokers are missing a trick in the emerging Asian markets”. He told delegates that on a recent trip to Singapore he had visited the major brokers’ operations in the country but none had claims staff, just producing brokers. However the underwriters have their claims staff on site. He went on further to say, “It means when a claim is received by the broker it has to be sent back to the claims operation and then sent back out to the underwriters. The brokers are really missing a trick.”
I have heard much from claims professionals in the London Market about the need to understand the customer’s business – to get in close and see how they work and what their issues really are. It is highly valuable to get claims people into the customer’s operation in person, to host claim scenario planning sessions where claim situations are examined and procedures planned and documented. All activities that are very important in building in the customer a confidence that, should things go wrong, the insurer will know how to support the customer and mitigate their circumstances in the best possible way. With multi-national or remote customers this clearly presents special challenges but all agreed that wherever possible this process should be adopted.
No-one reading this would expect to get to the end without seeing me mention technology – so as not to disappoint you – here’s the mention. Claims processing now has to be fast and efficient. Connectivity and the sharing of information: documents, forms, photo and video evidence and so forth, has to be simple and available to all parties at – quite literally – the touch of a button. Without good claims technology, and preferably claims technology that is shared or available to all in the process, this becomes problematic. Strong Case Management and business rules driven processes ensure information and tasks are moved around the global claims network instantly and business intelligence and analysis allows a close eye to be maintained over all aspects of the operation.