In the insurance community, this debate has been growing for a while now and, recently, was one of the topics discussed at Gracechurch’s London Claims Social a few weeks ago.
In a recent episode of The Insurindex Podcast, the Co-Founder & Co-CEO of Mosaic Insurance, Mark Wheeler talked about the concept of insurance being a promise to settle a claim.
The word “claim” is widely used in the insurance industry, but many market participants might feel it carries negative connotations and could be better replaced with a term like “solutions.”
And if so, should we focus more of our efforts on the inclusion of greater innovation in this area?
Gary Burke, award-winning author of ‘A Transformation Lens’ and Transformation Advisor, doesn’t think the word “claims” is outdated. He suggests that using a different word is essentially rebranding without addressing the underlying issues that gave the word a poor reputation in the first place.
“The problem with claims isn’t necessarily about the lack of innovation. The insurance industry sometimes forgets the basics and needs to think more about how to make things better from the perspective of a customer or claimant.” Burke said.
Burke also emphasised that insurers need to do more to improve the customer experience, particularly by offering greater empathy, patience, and effective communication when dealing with vulnerable customers. Recognising that vulnerability can also be situational, for example, a cancer diagnosis or losing a loved one.
Ben Bolton MD of Gracechurch disagreed, saying that:
“When I pay for a product or service I don’t have to ‘claim’ it! So, I’ve been running a one-man campaign to replace the C word because it just seems so outdated and negative…and you’d be surprised how much support I get for this at the claims top tables.
Language matters enormously in marketing any service and claims tends to be interpreted as meaning ‘you’ll be lucky to get paid. This narrative is unhelpful, especially as ‘claims service’ is becoming more important for selling and retaining business – which encompasses innovation.”
Bolton continued: “And while I know there are service issues that need fixing, the whole industry gets unfairly criticised as a result.
Just have a look at the Which’s? ‘Insurance rip-off’ campaign launched recently; this is over the top in my view but still damaging. Fortunately, the change is happening already and there are insurers and brokers I can name who are already quietly dropping the word and adopting language that communicates the positives rather the administrative process and they’re doing this because it helps them to compete.”
Recent takeaways from Gracechurch’s Claims Monitor reveal that brokers are placing greater emphasis on customer rather than process aspects, such as empathy and communication— these ‘soft skills’ are often outside the comfort zone of technically-focused claims teams.
“What customers want from the claims process, given that they could be in a state of severe distress, is a process that is easy to engage with, easy to understand and delivers on the promise that was made when the insurance policy was taken out.”
“Innovation can help speed up the process so a positive decision and payment can be made as quickly as possible. But all the innovation in the world doesn’t address the fact that some insurers can’t even do the basic stuff well.”
“They are difficult to engage with, aren’t always helpful and don’t seem to understand, for example, with a lack of transparency and unclear policy terms and conditions, they paint the whole industry in a very bad light.” He added.
It’s all very well for insurance companies to embrace claims innovation, but Burke thinks that addressing the basics also needs to be done as that would make a bigger difference.
“Data is key to improving service and controlling costs and insurers should also implement technology to identify fraudulent behaviour and prevent policies being taken out where future fraud is likely as well as identifying fraudulent claims.” Burke said.
Bolton concluded: “Insurers should have the ambition to use data first and foremost for the benefit of customers, so the start point shouldn’t be cost reduction or fraud prevention as important as those are – all successful businesses work out what the customers need first and the rest follows.”