Claims handling is the most significant component of the relationship between an insurance company and its policyholders. Claims also represent a unique type of transaction when compared to other components of financial services. The claims relationship needs to take center stage with sales and marketing of the insurance product. The business strategy known as customer relationship management is a key enabler of the sales and marketing process and that same strategy can be used to improve the claims handling process.
Additional Information
Highlights
The core service provided by a property and casualty (P&C) insurance company is the prompt, efficient, and satisfactory handling of claims against losses to insured property. Claims handling is the most visible and important component of customer relations for the P&C industry.
Compared to other sectors of the financial services industry, insurance has been slow to engage in the business strategy known as customer relationship management (CRM). Even when CRM has been used, it is almost exclusively the sales (agency) and marketing areas within the insurance organization that promote and shepherd its use. As insurers move to solidify their customer-centric strategy, they should now leverage CRM to improve the claims process.
Claims departments have used technology mostly at the front end of their process without a comprehensive strategy. Utilizing a CRM strategy from a claims perspective to actively manage customer relations at this critical juncture extends and improves on the most significant difference between insurance and the rest of the financial services industry—claims processing.
Because of the extensive information required to support CRM, a complementary technology strategy is needed to ensure its success. Clear expectations need to be established between the goals of the business strategy and the technological capabilities of the insurance company. Infrastructure weakness can undermine attempts to move forward with aggressive business or technology strategies. This TowerGroup Research Note examines ways that P&C companies can leverage CRM technology and infrastructure to improve their claims handling performance and contribute to their bottom line.
(0 items)
