CompleteMarkets
Read articles, training material for practically any topic.
CLAIMS HANDLING: IT'S A SMALL WORLD
Thanks to technology, pundits say the world is getting smaller; it’s become easy to communicate worldwide in real time at relatively inexpensive cost.  Thanks to technology, insurance agents say that their world is getting bigger – the Internet has made the world their oyster.  Both concepts are right!  The world has become smaller, while individual worlds have become larger.

Unfortunately, these beliefs can lead us astray and minimize the importance of our own backyard.  Regardless of the potential of the Internet, independent agents are local by nature.  Whether they do business in a metropolitan area or a small town, each agency tends to have a local sphere of influence.

Keeping this in mind, remember that the basic intangible nature of insurance is that it sella a promise to be there with a financial rescue net in case of a claim. This is the gist of insurance (although there's plenty of value-added along the way).  Agents never "deliver a product," unless the client files a claim.

Why then do so many agents pay so little attention to their clients’ claims?  Granted, a large Commercial claim usually gets your attention and your time. But what about  smaller Commercial or Personal Lines claims?  Your clients can easily see even a small claim as a catastrophe.

For instance, a mid-sized agency recently lost a Commercial client that had generated significant revenue for years. The reason: a Personal Auto claim by the family of the company president.  As a major client, he expected personal attention and didn't get it.  The agency did everything “by the book” as far as letters and notifications.  What it didn't do was go beyond this to coddle the client.

As long as we're talking Personal Lines, how well do you monitor the claims performance of your companies?  A good agent follows up on claims– and might even help clients with processing them.  But what about the treatment given to the other party?  If your client was liable, did the company treat the injured party with compassion, respect and efficiency?  Or did they put them through the proverbial wringer?

You might be asking, "Why should I worry about this?  The claims department is just trying to keep costs down and I don't have any financial ties to the other party."  All this is true, but it doesn’t take into account the local sphere of influence I mentioned at the beginning.  Think of this as the small town in which you do most of your business.  Can you afford the gossip that will spread from the "other parties" who are dissatisfied with the treatment received by a company you represent?  Can you afford to cross every such party off your prospect lists because they experienced the delivery of your product and promise – and it left them cold?

I was recently the “other party” in a minor auto accident.  The person who hit me was insured with one of the top five national companies through a local agent.  After being put through the wringer by an inept claims processor, I've been highly vocal with friends and neighbors about the poor treatment I received.  Likewise a few years back, I was utterly blown away by the exceptional treatment I received as a claimant against another major carrier.  The company went out of its way to make sure that everything went smoothly -- even arranged for direct billing on the rental car.  Although I'm not insured with this carrier, I’d be happy to recommend doing business with them.

How involved are you in the claims process?  Can you afford to let a company's claims procedure hurt the reputation of your agency?  Maybe you should consider follow-up surveys or calls to audit the claims performance of your partner companies.  If you’re  really courageous, survey the "other parties" as well.

It is a small world  – and word-of-mouth can make or break you.


Jack Burke
Other articles by: Jack Burke
Categories: General Information, Selling, Marketing, Social Media, Customer Service, Internet
This content has not been rated yet.