With the insurance industry undergoing a massive period of change and disruption, claims industry leaders have come together in a webinar on how insurers can understand the true cost of claims and improve financial outcomes.
The webinar was led by Pete Diskin, chief client officer of Gallagher Bassett United Kingdom, and was part of a global three-part series. He was joined by other industry leaders, including Peter Edgar, RSA UK head of motor claims operations; Peter Emson-Sewell, MS Amlin’s process & governance lead – delegated authority global claims; and Gordon Vater, Gallagher Bassett’s insurer practice director.
According to Diskin, the losses caused by COVID-19 are likely to exceed US$107 billion (around £80 billion) in the Lloyd’s of London market alone, demonstrating the staggering impact of the pandemic. Digitalisation is another major disruptor in the industry, which insurers must seriously consider and navigate carefully.
“We’re seeing the cogs of insurers continue to be disrupted in their existing products, the way we deliver, bind, quote and sit with our partners to underwrite and understand risks, and the way we roll-out and present information,” Diskin said. “Digitalisation is the elephant in the room… whether we go to full automation in some classes or decision support tools first, it is going to happen.”
Meanwhile, Edgar said that the industry often overlooks the reputational cost of claims. Emson-Sewell agreed with this, as the claim experience is a “shop window” for insurers. With such narrow differentiators between firms, it often comes down to the service and brand for customers.
“What we do in claims has a direct impact not only on the industry, but also on our customers and our policyholders,” Edgar said. “The claim department and claim department supply chain is the heartbeat of any insurance company.”
He added that the claims handling process today is much harder than 30 years ago. As such, firms must invest in people and their skills in order to provide the best service to the customer.
Vater expects COVID-19-related claims to drive a more flexible and agile operational model and a change in costs and behaviours – some good and some bad.
“We all need to ask ourselves in the insurance industry, what are we measuring and is it still valid moving forward?” he said. “It comes down to the age-old question – does a poor claims experience have a direct impact on whether a customer is going to renew with a particular insurer?”