Claims Excellence

8/9/2019 Claims Excellence

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CLAIMS EXCELLENCE– AMULTI DIMENSIONAL

APPROACH

P.C.JAMES

CHAIR PROFESSOR

NATIONAL INSURANCE ACADEMY


2/50

WHAT IS INSURANCE?

SEARCH GOODS ?

EXPERIENCE GOODS ?

CREDENCE GOODS ?


3/50

What is “Is!"a#$%?

• C&''$"#ia( '$#hais' )&" t"as)$""i*"is+ a, s-"$a,i* (&ss

• E#&&'i# C&#$-t &) Is!"a#$/. Is!"$" &0$"s -&(i#1 t& #&2$" s-$#i3$,"is+s

4. Is!"$" #&(($#ts -&(i#1 -"$'i!'s )"&'

#!st&'$"s5. Is!"$" i2$sts -"$'i!'s

6. Is!"$" -a1s '&$1 t& is!"$,#!st&'$"s i th$ $2$t &) (&ss$s #&2$"$,71 -&(i#1.


4/50

L&ss E2$ts W&"(,8i,$ 49/5G$&*"a-hi#a( &2$"2i$8

S&!"#$ G$& Ris+s R$s$a"#h:NatCatSERVICE – As at Ja!a"1 49/6

G(&7a( Nat!"a( Catast"&-h$ U-,at$

6; 49/6 M!i#h R$

Geophysical events

Natural catastrophes

Climatological events(extreme temperature, drought, wildfire)

Selection of signicantloss events

Extraterrestrial events


5/50

/49/9 -'

Est 'at$ Is!"$ L&ss$s "&' t $ T&- /9 H st&" #aEa"th=!a+$s i U.S. as$, i C!""$t

EB-&s!"$s

$ Billions*

While the Majority of Costly Earthquakes Are Likely to Occurin California, the New Mari an Charleston, !C, Areas

"a#e !inificant E%&osure As Well'

*Analysis conducted in 2012 based on exposures as of 12!12011"#ources$ A%& 'orldwide %nsurance %nformation %nstitute"

(otential insure losses are )uchhiher toay ue e#elo&)ent anhiher &ro&erty #alues' ew &ro&ertyowners ha#e earthquake co#erae in

)ost areas'


6/50

C(ai's Maa*$'$t

• /9 S.F.Ea"th=!a+$

L(&1,s !,$"8"it$":C!th7$"t H$ath:&",$"s a*$ts t&/pay all claims infull regardless ofpolicy terms'L(&1,s -a1s K/99

'i((i& i #(ai's.


7/50

THE STORY OF LLOYDSHAARD UNLIMITED Y ANTHONY ROWN: L(&1,s &) L&,&

P"$ss (t,. //

• O2$" 599 1$a"s &) L(&1,s is &t si'-(1 th$ -"a#ti#$&) is!"a#$: 7!t a s$t &) -"i#i-($s. At th$ h$a"t &)

th$s$ (i$s: U(i'it$, Lia7i(it1: the under-riter1so2ligation to pay his losses.

• O th A-"i( /9: th$ ti(( th$ *"$at$st at!"a(,isast$" i th$ hist&"1 &) th$ 8&"(, t&&+ -(a#$ – th$Sa F"a#is#& Ea"th=!a+$.

• Ma1 #&'-ai$s "$-!,iat$, (ia7i(it1 7$#a!s$ th$

3"$ ha--$$, a)t$" th$ $a"th=!a+$ #&((a-s$ 7!t th$L(&1,s ,i, &t.

• Th$i" (ia7i(it1 8as K/99 'i((i&: a sta**$"i* 3*!"$

i th&s$ ,a1s. +t created a ne- and

massive good-ill for the future'


8/50

Ris$ &) Ris+ Maa*$'$t

• P!7(i# #&3,$#$ i is!"a#$ i,!st"1 s&a"si,!st"1 7&&'s "is+ 'aa*$'$ti&2ati&s $8 t1-$s &) is!"a#$ $'$"*$.


9/50

C(ai's 'aa*$'$t

• Ha,(i*-$&-($ R&($

• C&st'&it&"i*R&($

• S$"2i#$R&($

• St"at$*i#R&($

COMPANY

PHILOSOPHY

C3S*4ME5

67SE7C*+4NS

EEP HAPPY

ALLSTAEHOLD

ERS

RIGOROUSMONITORIN

G OFSUREYOR

REPAIRER


10/50

CLAIMS – STRATEGICPROPOSITIONIS THIS THE WHOLE PICTURE?

P"&-&siti& / 'aa*i* #!st&'$"satis)a#ti&

Th$ +$1 7$#h'a"+ &) a i,!st"1($a,$"s #(ai's s$"2i#$ is #!st&'$""$t$ti&

P"&-&siti& 4 'aa*i* #(ai's($a+a*$

th$ 7!(+ &) a is!"$"s &2$"a(($B-$,it!"$ "$(at$s t& i,$'it1

#&sts a, ,i"$#t #(ai's ha,(i*


11/50

WHY SO MANY CLAIMS?

• I Li)$ is!"a#$ a('&st $2$"1 -&(i#1"$s!(ts i #(ai's'at!"it1 – -"$ssi* is"$=!i"$,

• What is th$ #(ai's )"$=!$#1 is &(i)$?• FIRE

• HEALTH

• AGRICULTURE


12/50

ARE CLAIMS TO E SEENDIFFERENTLY

• MOTOR TP CLAIMS

• FAULT LIAILITY CLAIMS

• HEALTH CLAIMS• MOTOR REPAIR CLAIMS

• TOTAL LOSS CLAIMS

• CLAIMS WHERE GOODS RECOERED:UT IN COURT

• CASES IN COURTSOMUDSMAN


13/50

CLAIM ISSUES RULES OF

INDEMNITY

• NO PROFIT NO GAIN

• ALUE AS INSURED – INTERPRETATIONS

• WEAR Q TEAR AND OTHER OSOLESCENCES

• REPAIR COST ISSUES – LAOUR AS AGREED:PARTS WITH DEPRECIATION

• TOTAL LOSS ISSUES – CTL


14/50

+ (s of CLAM!

(-OM!E

(-EM.M

(E-L(-O(E-/0

(E-O1

(LACE(E-!ON


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ON.! O (-OO

(-OO O CO2E-A3E W/"N!.-E1

-E(.1A/ON 4 E5CL.!ON ON.!LE! W/" N!.-E-


16/50

.!E O BO.N1A-E! N(OLCE!

N!.-ANCE ! BE!/ O- .NNL.ENCABLE-!6!

eucti7les, coinsurance, franchise, li)itationsan e%clusions control the uncontrolla7le


17/50

HOLISTIC CLAIMMANAGEMENT

• NOMINATOR MANAGEMENT

•

• DENOMINATOR MANAGEMENT

• TIME Q SPEED

• • FEAR Q DELAY


18/50

INDUSTRY LACMARS

• DENIAL OF COER

• DENIAL OF CLAIM

• DELAY IN SERICE


19/50

INSURANCE ALUE CHAIN

DISTRIUTION

UNDERWRITING

RENEWAL

CLAIMS GREIANCE

/

WIDEN THE POOL

REDUCERISS

IMPROING

UALITYOF THE

OO

PAY WHATIS

COERED

PROIDE THE

SERICE

OUT

SOURCEEXPAND

AUTOMATEQ

PERSONALISE

OUTSOURCEQ TAE

RESPONSIILITY

PROCESSESQ SERICES

REAMP


20/50


21/50

TOO MANY ? INSURANCE LOSSESWHY?

• INEFFECTIE UNDERWRITING – GOODCUSTOMERS DO NOT WANT LOSSES

• WARRANTIES NOT INCORPORATED

• IMPROPER PRODUCT ENEFIT DESIGN• UNINTENTIONALLY ROAD POLICY

WORDING

• COST SHARING INSUFFICIENT• INFLATION IN CLAIM COSTS

• INSUFFICIENT PRICES – NOT RIS

ASED


22/50

46(EC*+:ES 4$ C7+MSE**EMEN*

• INDEMNIFICATION

• LOSS COST REDUCTION

• SERICE Q CUSTOMERSATISFACTION

*H543GH

• CORRECTNESS OF SETTLEMENT

• SPEED OF SETTLEMENT


23/50

INSURER SUJECTIE CLAIMIEWS

• C!st&'$" is &t s!--&s$, t& #(ai'

• It 'a1 7$ )"a!,: $Ba**$"at$,

• W$ $$, t& a--&it a st"i#t s!"2$1&"

• S!"2$1&" ,$(a1 is !sti3$,

• $$- as+i* )&" '&"$ ,!'$ts:#(a"i3#ati&s

• A--&it 4, s!"2$1&": i2$sti*at&"• T$(( #!st&'$" that 8$ 8i(( -a1 th"&!*h

)&"!': &'7!,s'a $t#.


24/50

CUSTOMER PERCEPTIONS

• COMPANY HANDS OFF –• S!"2$1&" is a(( -&8$")!(: 2i,i#ti2$:

a"7it"a"1

• T&& 'a1 )&"'a(iti$s: ,!'$ts:,$(a1s: 2$"i3#ati&s

• N& &(1 & i,$'it1: #!st&'$" )$$(s

is!(t$,• P($t1 &) *"i$2a#$s: #&!"t #as$s: 7a,

'&!thi*


25/50

S*E;S +N C7+MSE**EM*

• ;rompt dealing of the claim intimation&day


26/50

+M;45*7N* ?3ES*+4NS +NC7+MS M7N7GMEN*

• 7' %H4 C7+MS , GE*S *HE+NEMN+*@A

• OWNER

• ANER• AILEE

• CONTRACTOR

• GROUP – ASSOCIATION: CLU: EMPLOYER• NOMINEE – SPOUSE WHAT IF UNRELATED

PERSON IS NOMINEE

• REPAIRERSHOSPITAL


27/50

IMPORTANT UESTIONS INCLAIMS

• 6' +S *HE5E 7 4SS 7N %H7* +S +*S5E7 C73SEA

• R$a( ta*i7($ (&ss – =!$sti& !+&8

!#($a" (&ss$s: a*i*: &7s&($s#$#$: (&ss &)'a"+$t 2a(!$ $t#.

• C($a" a##i,$ta( !)&"$s$$ #a!s$ – $*. is,$ath 71 '!",$"s!i#i,$a##i,$t ?

• Is th$ (&ss -a1a7($ i 3a#ia( t$"'s –=!$sti& (&ss$s &t #($a"(1 #&'-!ta7($$B#$-t i (ia7i(it1 a8a",s


28/50

IMPORTANT UESTIONS IN CLAIMS

• C' +S *HE 4SS ME7S3576E +N;H@S+C7 *E5MSA

• Ca it 7$ #($a"(1 -h&t&*"a-h$,?

• Ca it 7$ '$as!"$,?• Is th$"$ a sa(2a*$: i) & 8h1 &t?

• Is th$"$ a ih$"$t 2i#$ – $*. #h$#+ ,a'

• Has th$ -$"i( 'a,$ (&ss i 3a#ia( t$"'s– ti'7$" s!7'$"*$, i &&, 8at$"

• A1 &th$" i'-ai"'$t -"$t$,i* t& 7$ a(&ss


29/50

IMPORTANT UESTIONS INCLAIMS

• ' +S *HE 4SS ME7S3576E +N$+N7NC+7 *E5MSA

• Is th$"$ a '&$1 2a(!$ t& th$ (&ss

• A"$ th$"$ a##&!ts Q stat$'$ts

• Is ,$-"$#iati& a, &th$" ,$,!#ti&sa--(i#a7($?

• Is it )!((1 is!"$,?


30/50

IMPORTANT UESTIONS IN CLAIMS –

COERAGE ISSUES

• E'+S *HE S36(EC* M7**E5 C4:E5E7N *HE ;E5+ C4:E5E 4;E57*E 9S+NGE ;E5+# M3*+B;E5+# 7 5+S

• +ncluded


31/50


F.SALAGE DISPOSAL

• LOSS MINIMISATION

• COLLECTION AND SEGREGATION OFSALAGE

• MEASUREMENT AND RECORDING OFSALAGE

• TENDERING AND PROCEEDURES FOR PRICEDISCOERY

• DISPOSAL EFORE FURTHERDETERIORATION

• ADJUSTMENT IN CLAIMS

• URGENCY ISSUES


32/50


G.PAYMENT OF CLAIMS

• ALL DEDUCTIONS TO E MADE –DEPRECIATION: WEAR AND TEAR ASAPPLICALE

• UNDERINSURANCE

• SULIMITS

• SALAGE

• DEDUCTILES


33/50

SPEED OF SETTLEMENTS

• A--&it s!"2$1&" i 46 h&!"s Q s!"2$1&"sh&!(, "$a#h i 46 h&!"s a18h$"$ i I,ia

• U-(&a, -h&t&s i 4 ,a1s

• Gi2$ it$"i' "$-&"t i / ,a1s )&" (a"*$#(ai's & -h1si#a( as-$#ts

• R$#&''$, & a##&!t -a1'$t i / ,a1s

• Fia( "$-&"t i 59 ,a1s 'aB '&ths

• Fia(is$ #(ai' i $Bt 59 ,a1s i) & =!$"1 t&s!"2$1&": &" i) =!$"1 is th$"$ s&'$a,,iti&a( as a((&8$,


34/50

SPEEDING CLAIMS SERICE

• ONACCOUNT PAYMENTS

• CASHLESS PAYMENTS

• STRAIGHT THROUGH PROCESSING

• TECHNOLOGY FOR CLAIMS

• PAPERLESS WORCOMMUNICATION

• PARALLEL PROCESSING• OUTSOURCING – TPA

• PROXY INSURANCE APPROACHES


35/50

REGULATORY ASPECTS OFCLAIMS

• REGULATORY INTENT IS PROTECTION OFPOLICYHOLDER

• SPEED OF SETTLEMENT

• TRANSPARENCY IN SETTLEMENT• USE OF SUREYOR AS CATEGORISED

• CODE OF CONDUCT OF SUREYOR

• GRIEANCE HANDLING – AT COMPANYLEEL: OMUDSMAN LEEL

• IRDA PROTECTION OF POLICYHOLDER

REGULATION


36/50

USE OF SUREYOR

• SUREYOR TO E APPOINTED IN TIME

• TO REACH SPOT IN TIME

• TO TAE PHOTOGRAPHS: UPLOAD

PHOTOS:• SUREY: INESTIGATE: TAE EIDENCE

• RECOMMEND ON ACCOUNT PAYMENT

• EXAMINE RECORDS: ACCOUNTS: SALE:PURCHASE: ETC

• COLLECT DOCUMENTS


37/50

USE OF SUREYOR

• T& *i2$ "$-&"t =!i#+(1 – 8ithi &$'&th: &t '&"$ tha '&ths

• T& *i2$ #&-1 t& is!"$, i) as+$, )&"

• T& as8$" =!$"i$s &) is!"$"

• T& stat$ 8h$th$" #(ai' -a1a7($: i) s&h&8 '!#h: 8h$th$" 8a""ati$s:

#&,iti&s $t#. #&'-(i$,• Is!"$" &t 7&!, 71 s!"2$1 "$-&"t: i)

#($a" #&t"a"1 )a#ts a"$ a2ai(a7($


38/50

DOCUMENTATION IN CLAIMS

• INTIMATION: ESTIMATE: CLAIM FORM

• SUREY REPORT WITH PHOTOS

• COPIES OF REPORT TO STATUTORYAUTHORITIES Q THEIR FINDINGS

• DOCUMENTARY EIDENCE OF LOSS THROUGH ACCOUNTS: FACTS ANDFIGURES

• REPAIR: REINSTATEMENT ILLS ASAPPLICALE


39/50

CLAIMS Q DISPUTES

• GREIANCE HANDLING AT COMPANYLEEL

• GRIEANCE HANDLING AT IRDALEEL

• IRDA INSPECTION

• OMUDSMAN SCHEME IN INDIA

• CONSUMER DISPUTES REDRESSALFORUMS

• ARITRATION

•

O O S


40/50

OTHER FORMALITIES INCLAIMS

• OPENING OF CLAIMS REGISTER

• REGISTERING OF EERY CLAIM ATINTIMATION

• MAING AN OUTSTANDING PROISION

• REISION OF OUTSTANDING PROISION– UARTERLY FOR SHORT TAIL Q

ANNUAL FOR LONG TAIL• RETURNS: STATISTICS

• CLOSING THE CLAIM FILE

• REOPENING THE CLAIM FILE


41/50

TECHNOLOGY IN CLAIMS

• USE IT Q PAPERLESS APPROACHES TO THE EXTENT POSSILE

• UPLOAD PHOTOGRAPHS AT THE EARLIEST

• SEND EREPORTS: SCANNED REPORTSFOR PARALLEL PROCESSING

• USE OF IDEOS AND SUREY USING

TECHNOLOGY• CONCEPT OF STRAIGHT THROUGH

PROCESSING OF CLAIMS

For Customer


42/50

The system triggers SMS / Emailscommunicating the following:

1) Policy Number, when Policy is issued.

2) Claim Number, when claim is intimated .

3) Surveyor contact details to customer, onappointment of surveyor.

4) Brief details of claim to surveyor on appointment.

5) Intimation of settled amount to customer

6) SMS / Mail alert for policy renewal.7) Intimation of payments made by ECS.

8) Grievance Reference Number on registration of agrievance.

9) Seasons greetings

10)CMD Messages.


43/50

CUSTOMER SATISFACTION IN

CLAIMS

• CUSTOMER FACES SUDDEN LOSS Q SHOC

• CUSTOMER FACES CASH CRUNCH INREINSTATMENT

• THE CONCEPT OF ON ACCOUNT PAYMENT• HANDHOLD CUSTOMER TO PROE THE

CLAIM

• PROACTILEY ASSIST IN GETTINGDOCUMENTS: EIDENCES

• DO NO AS WHAT IS NOT AAILALE:POSSILE

• SPEED IN PROCESSING AND SETTLEMENT

COSTS IN CLAIM


44/50

COSTS IN CLAIMSETTLEMENT

• CLAIM COSTS –OERPAYMENTUNDERPAYMENTINDEMNI TY

• CLAIM COST OF SUREYQ INESTIGATION• CLAIM ADMIN COST

• COST TO INSURER

• COST TO CUSTOMER• TIME COSTS TO OTH

• COST OF DISPUTES


45/50

CLAIMS Q REPUDIATION

• O0$"i* -"&&) &) #(ai' is th$ &!s &)th$ is!"$,

• P"&&) i#(!,$s #!""$#$ Q a'&!t &)

(&ss• I "$-!,iati& th$ &!s is & th$

is!"$" that "$-!,iati& is as -$" t$"'s

a, #&,iti&s i th$ -&(i#1• S!#h "$-!,iati& '!st sta, i a #&!"t

&) (a8


46/50

CLAIM MINIMISATION Q

RECOERIES

• D$-"$#iati&: 8$a" Q t$a": "$,!#ti& )&"*$$"a( #a(#!(ati&: &(, st+: s!,,$,"&- i 2a(!$s: 8asta*$s $t#.

• UNDERINSURANCE: SULIMITS• DEDUCTILES

• SLAAGE

• SUROGATION• COINSURANCE

• REINSURANCE


47/50

UNDERWRITING Q CLAIMS

• UNDERWRITING IS FOR THE FUTURE

• CLAIM IS OF THE PAST

• FOR OMISSIONS OR FAILURES IN UW OR

POLICY CLAIMS CANNOT E DENIED• INSURANCE TO COER A REAL

UNFORESEEN LOSS – &#$ s!#h a (&ss is

$sta7(ish$, a, is #&2$"$,: a,'it(ia7i(it1

• STEPS TO ARRIE AT NET AMOUNT


48/50

N!.-ANCE -A.1!

+A-./+# &A3/+45 64365

rau a&&ears in ifferent sha&es an uises, incluin8

/"E LO!! /"A/ 11 NO/ "A((EN /"E CON/-2E1 LO!! /"E 1ELBE-A/E LO!!3EN.NE LO!! B./ E5A33E-A/E1

3EN.NE LO!! E5CL.1E1 B./ MA1E /O / /"E(OLC0

A LO!! W"E-E /"E 3OO1! CLAME1 O- WE-ENO/ OWNE1 B0 /"E CLAMAN/

;4SS+6E $573 5+S


49/50

;4SS+6E $573 5+S;4+N*S

• +NS35E5

• +NS35E5 EM;4@EES

• +N*E5ME+75+ES


50/50

THAN YOU

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Claims Excellence