As with any process that has remained largely unchanged for a long time, the claims space has become a hotbed for innovation, new ideas and system redesigning over the past few years – however, according to one expert, there are a number of things that are still missing.
Nick Herford, CEO of claims management company Hello Claims started his career as a panel beater and engineer before moving into claims management. He says communication at claims time has often been one of the biggest things in need of improvement, and when it comes to information, insurers often still don’t analyse their own claims data – something that could help dramatically improve a customer’s claims experience.
“During my time with insurers, I could see that the loss adjusting process was one that had been around for 30-odd years,” Herford explained.
“What was being left out, which in my opinion was key, was that they were not calling the insured or third party to tell them whether or not the claim was authorised. They would not contact the broker, which would create a lot more work for them as they’d have to chase insurers to try and find out what was happening.”
“When I started Hello Claims, what I really wanted to do was turn the whole process on its head and involve all of the stakeholders from the start,” he said.
Herford has a wealth of experience in dealing with motor vehicle claims, and he says that when it comes to data, this is something Hello Claims really prioritises.
“Today, there is a dramatic increase in claims costs in the motor vehicle space, and it’s becoming very difficult for insurers to return any underwriting profit,” he explained.
“There’s also a lack of accurate claims data. When we started, we interviewed a number of claims managers, and they were unable to tell me things like average repair costs – they were just doing the best they could with the information that they had, so we really wanted to focus on breaking down that data and putting it into an easy-to-read format.
“One of the foundational things we do with new clients is look at two years’ worth of their data, remove all the $25 and $0 claims to get the true average repair cost, average repair days, etc.”
“As an industry, we are very insulated in the way we operate,” Herford concluded.
“We judge ourselves on each other, whereas what we should do is look at the end result and use that as a benchmark. In two to three years, I see the settlement of claims in minutes, not days or weeks.”
