11/24/2010

Claims Brand-Aid

Restoration service providers are the insured's primary brand experience.

By Wayne M. Wudyka

If you're older than 30, you probably remember Mercurochrome. If you're younger than 30, you'll need to hear more. You see, Mercurochrome—a topical antiseptic used since Warren G. Harding was president—was pulled from the general interstate market about a dozen years ago because it was not generally recognized as safe and effective. It was never reported to have hurt or killed anyone, but the FDA didn't think that was such a hot standard, especially since, as its name suggests, it contains mercury.

And that's just the point: It's not really enough just not to be toxic. If you're affiliated with a noxious element, your brand is going to suffer. So, are your carrier's vendors offering balm after a property loss or are they pouring salt in the wound?

Within today's business environment, just how important is customer satisfaction? TARP Worldwide, a prominent customer service research firm, reports that:
  • Just one dissatisfied customer will share that experience with between 11 and 20 other people
  • 50% of customers don't complain—they simply take their business elsewhere
  • Customer problems decrease loyalty by 15% to 30%
  • Resolving a customer problem on the first contact results in 96% retention
  • It costs five times as much to acquire a new customer as it does to retain an existing one.
Considering the property insurance industry specifically, J. D. Power & Associates' 2010 Home Claims Satisfaction Study confirms TARP Worldwide's research and reveals the critically important role of claims service in relation to policyholder retention. According to the study, "Among home insurers that provide highly satisfying claims experiences, 71% of their claimants indicate that they 'definitely will' renew with their insurer and only 4% say that they have switched insurers since experiencing their homeowners claim. Similarly, 67% of these claimants say they 'definitely will' recommend their insurer to others."

"Suffering a property loss and filing a claim tends to be an emotionally charged experience—often more so than an auto claim," said Jeremy Bowler, senior director of the insurance practice at J. D. Power and Associates. "As a result, the property claim represents a moment of truth for insurance claimants regarding their insurers, so it's particularly important that the claims experience is handled in a satisfying manner to ensure claimants remain with the insurer in the long run."
According to Bowler, "The home claims process tends to be extremely complex, with an almost infinite variety of homes in the country that vary in terms of architectural styles, age, materials, building codes, et cetera. All of this makes standardizing the claim handling process more difficult. However, every insurer may reap benefits by driving greater consistency in customer handling, particularly in terms of education, empathy and service convenience."



The distinct focus on customer interaction as a driver of customer satisfaction has become a popular topic for insurance industry training sessions. The Property Loss Research Bureau (PLRB) included a workshop on customer service in its three 2010 regional conferences. Similarly, the International Insurance Institute offered breakout sessions on successful claims handling during its 2010 Claims Education Conference, with ongoing courses available to the insurance industry outside the conference.

Clearly, industry organizations are recognizing the importance of customer service and the tremendous need for training. The agent oftentimes is the first call, and their voice represents the initial response to the insured. The "face" of the insurance company, however, is typically the adjuster, as well as the service providers who arrive on site, those who are charged with handling the actual restoration and/or repair of the home. The insured's perception of these individuals becomes the reality of how the insured views the insurance company overall.

Your Recommended Vendors Co-Brand to You
Consider the decision-making process and criteria for handling maintenance or repairs in your own home. Decisions often are based on referrals. A recognized brand or well known local company also would be a logical choice. The bottom line is that you want service at the appointed time, handled by trained professionals who are friendly and trustworthy and who meet your expectations. The same standards should prevail when selecting a service provider to work with your company's insureds. At a critical time in their lives, policyholders are faced with service providers, and those vendors represent you and your company. The restoration service providers assigned to the loss become a key component in the customer satisfaction process.
Positive first impressions are crucial, as is the ability to demonstrate true empathy toward the victim of the loss. Consistency and availability are required throughout the claims process. Just as insurance companies have gone to great lengths to ensure accessibility around-the-clock, with service beginning when needed by a policyholder, service providers must follow suit. These are the moments of truth in claims handling and represent opportunities to strengthen or weaken an insurance company's brand. Highly professional service providers are specially trained in key aspects of customer interaction, including communication techniques, professional appearance, and respect for the customer's belongings and privacy.

For any restoration service provider, it starts with speed of response. Standard business hours simply are inadequate. Thanks to technology, whether an online interface or a 24/7 call center, insurance companies are able to assign claims at any hour. Professional service providers similarly must be able to confirm receipt of the assignment and contact the insured within predetermined parameters, such as a specific number of minutes or up to one hour. The initial timely contact to an insured demonstrates action and reflects positively on the insurance company; the policyholder perceives that the adjuster has begun the process and is addressing their needs.

Beyond timeliness, however, the content of the conversation carries significant importance. A service provider who takes the time to convey understanding about the difficult situation and listens to the needs of the insured will lay the foundation for credibility and set realistic expectations. A trained professional will be able to make the insured feel as though theirs is the only job—that their needs have been heard and will be addressed.

The next step is defined by on-site interaction and appearance. A professional will first and foremost consistently cover the basics, such as arriving at the insured's at the appointed time in a vehicle that is clean and well marked, in a uniform with a logo, and with proper photo identification. Then the communication component comes into play.
  • A trained professional will verbally convey empathy and state the importance of the restoration process going well.
  • It is important to give the insured permission to feel that their emotions are reasonable, that the professional has dealt with numerous homeowners who have been through difficult situations such as this, and that it is normal to feel unsettled or uncertain.
  • The concept of timing is important to explain, as an insured's point of view might be much different from that of the adjuster and/or the service provider.
  • Checking on the insured throughout the conversation by using a phrase such as "Does that sound OK?" will determine whether what is being spoken is being understood.
  • A statement about the service provider's experience, such as how long their company has been in business or how many homeowners have been helped, can be followed by a promise to do one's best. The key is to focus on doing the best job possible, as many factors may be out of the service provider's control and therefore unrealistic.
  • Thorough background materials are essential for setting a tone of professionalism and trustworthiness, and proper documentation will ensure the protection of all involved with the process.
Once a rapport is established through all of these components, the service provider's actions and performance become the lynchpin of customer satisfaction. A standardized, methodical approach to scoping the loss and conducting an on-site inventory reinforce professionalism and set the stage for actual restoration results. Additionally, respect for the client's belongings and privacy are key. For example, a textile restorer often must be one of the first specialists on a loss site, as clothing and other fabric items, such as window treatments and bedding, must be removed before contents cleaning companies and mitigation contractors begin their work. The textile specialist handles the most personal items in a home, whether clothing or sentimental items. Decorum, no matter what is found in the home and no matter what niche the vendor works in, is essential. All it takes is one smirk or one disrespectful comment to sting a client and leave a sour impression.

Making Sure Your Vendors Fit Your Brand
In some cases today, insurance carriers are implementing defined programs for service that include specific time requirements for contacting the insured, arriving on-site, providing an estimate and completing service, among other parameters. These service agreements ensure that the insurance company's promises to its policyholders are fulfilled. Other carriers have turned to a third-party administrator (TPA) for pre-qualifying service providers and monitoring performance. The objective is to alleviate the guesswork and uncertainty about restoration, while simplifying the process of selecting qualified and competent service providers. Either way, detailed monitoring of time-in-process metrics enables the adjuster to stay in control of, as well as informed about, progress. This information is invaluable for those inevitable times when an insured calls to ask about the status of the service being performed.

As an IBM poster campaign once blared: "The customer pays your salary!" Being ever mindful of the vital importance of each and every claimant experience will go a long way towards achieving retention objectives and building and sustaining top brand quality. Make sure your vendors know your brand and represent it at every claim.
Wayne Wudyka is CEO of the Certified Restoration Drycleaning Network (CRDN), an international organization of textile restoration specialists. CRDN's national claims assignment call center can be reached at 1-800-963-CRDN or www.CRDN.com.


Wayne M. Wudyka is CEO of the Certified Restoration Drycleaning Network (CRDN), an international organization of textile restoration. He has been a CLM Fellow since 2012 and can be reached at (248) 246-7878, www.crdn.com

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