Loss cost containment, customer service top of mind among American chief claims officers

Loss cost containment and delivering superior customer service are the top goals for chief claims officers at property and casualty insurance companies in the United States, according to a new survey from Towers Watson.

Loss cost containment was ranked by 89% of CCOs as either their primary or secondary claim operational goal, while 71% said the same for delivering superior customer service. The survey, conducted last June and July, included responses from 35 CCOs at a mix of small, mid-size and large carriers in the U.S.

To tackle both those issues, 83% of respondents indicated that proactive claims handling is the most important tactic.

“Claim officers recognize the success of their organization comes down to people first and foremost — and that starts with the claim-handling staff,” Frank Ramsay, Towers Watson’s North American claim management practice lead said in a statement.

“According to the survey’s findings, CCOs say their claim handlers have extensive technical expertise and experience, and generally are empowered by their supervisors to deliver superior claim results. However, claim organizations also have several competing priorities that take file time away from their claim handlers, which in turn detracts from their highest priority: managing the files they have been assigned.”

When asked what barriers claim handlers face in achieving superior outcomes on individual claims, 77% of respondents cited passive claim handling, followed by 60% naming ineffective supervision.

Allowing claim handling staff to settle most of their claim inventory within their own authority was deemed important, with 86% of CCOs saying their employees don’t need additional permission to settle claims within their authority, while 74% said more of a claim handler’s inventory is within the handler’s settlement authority.

“Supervisors that empower their claim-handling staff to take charge of their claim inventories can really deliver value and reduce passive claim handling,” Ramsay noted.

“As the survey results showed, passive claim handling is the top barrier to achieving superior claim outcomes on individual claims. Supervisors should actively work with claim handlers to address and eliminate the factors that enable passive claim handling, such as misplaced priorities and focus, over reliance on process and disengagement.”

When asked about challenges in delivering superior claim outcomes, respondents noted that insufficient understanding of leading indicators and metrics (46%), high levels of inventories and caseloads (43%), and lack of sufficient technical expertise (40%) were all issues.

“More investment is needed to ensure claim handlers have a better understanding of the metrics their companies deem important for managing cases and containing costs,” Ramsay noted.

“Insurers should also make sure caseloads are reasonable so claim handlers can devote the necessary time and effort needed to actively look at claims rather than provide only perfunctory treatment.”