James Moorhouse explains how making a pre-emptive plan for claims surge events such as Covid-19 pays off in the long run
With nearly every person in the UK affected by Covid-19, customers and businesses have had to turn to their insurance products for financial protection. Claims handlers are currently processing queries ranging from how business interruption policy wordings provide cover, to surges in new types of claim due to the number of people working remotely.
An increase in claims is to be expected during such an unprecedented situation. However, the variety of claims is also unique. Not only will claims handlers need to be able to handle the volume of queries but also know how to respond properly. While it is true that no two claims are alike, the scope of the individual circumstances for each one means that pressure is at an all-time high.
To handle an increase in claims, while continuing to maintain good customer service, claims teams should already have a plan in place so they can respond quickly. 'Surge events' are when a sudden incident occurs, such as a catastrophe or natural disaster, resulting in a dramatic rise in insurance claim enquiries. Other types of surge occur seasonally, such as theft claims during the Christmas period or escape-of-water claims during winter months.
While there is no single type of claim specific to Covid-19, the effect it has on the entire world means that it has a varied impact, causing many types of different claim.A catastrophic event such as this can have a devastating effect on a customer. However, if claims handlers are also overwhelmed by the number of queries they need to process, this can cause a delay in responding, causing the customer further stress.
Circumstances can vary, but the growing volume of calls coming through could include accidental damage, fire or life claims. This is why it is important for there to be a resilient team on the other end of the telephone that can think quickly as well as provide reassurance during a stressful time.
A surge event can also impact the claims team themselves. Therefore, it is important to already have a contingency plan in place in case there are employee absences, or other factors preventing staff from handling claims, during an emergency.
To prepare for a major event, a designated 'surge group' should be created. This surge group should include several different teams:
By creating such a group that incorporates relevant teams, a thorough contingency plan can be implemented that considers the impact a surge event will have across the whole firm and not just those concerned with front-line handling. Quarterly meetings during 'peacetime' can allow teams to update each other with concerns and preparations. These will become more frequent in the likelihood of, or during, an actual event taking place.
The benefit of creating a surge group means that teams can adapt quickly if they need to focus their attention elsewhere. The cross-training of certain employees will mean that extra support can be provided if more people are needed to speak to customers. Telephone systems and access rights can also be updated so that more claims handlers can take extra calls to support the division affected. This is particularly important when needed to separate non-urgent claims from those connected to the surge event.
An 'event epicentre' during a surge will also allow all employees to access and view the same information and data. This will help to create a central point of truth for all staff involved in responding and reduces the number of individual emails. Training materials for handlers can also be made available here if they are assisting in an area that is not their regular field of expertise.
However, insurers should not wait for a surge event to happen before taking action. By working on preventative measures, such as alerting customers on how to reduce fire risks or prevent an escape of water, insurers will help limit potential damage.
One other thing to note is that fraudsters may use the opportunity during a surge event to take advantage of claims handlers who may be slightly inexperienced or busier than usual during this period. This is why it is important to still follow claims processes thoroughly, even when needing to process multiple claims as quickly as possible. The time and resources spent on investigating fraudulent claims during busy periods also takes support away from the customers in genuine need.
As the impact of Covid-19 develops, it is important for claims handlers to remain aware and proactive so that they can respond to customers quickly and effectively.
You can read the full Good Practice Guide on surge events on the Society of Claims Professionals' website here: www.socp.org.uk/91218
James Moorhouse is content manager of the CII