Claims service – the primary reason for buying Insurance?

If you’re a Financial Director or business owner in Scotland about to accept that great insurance quotation, have you even asked “the claims question”?

The Broker has probably volunteered little if anything about their claims service.

This article gives some insight into why…

#howden #insurance #claims #insuranceclaims

The reason a company purchases Insurance is to financially protect the business, whether its assets, income or potential liabilities. It’s not a luxury purchase, just a necessity and the expectation of owners, shareholders, clients and the public.

There is no value attached to Insurance, beyond the intangible peace of mind. In reality unless you claim under an Insurance policy, it’s nothing more than a few PDF documents you’ve paid hundreds or thousands of pounds for! If you’re lucky, you will never need them!

It stands to reason that the priority order of Insurance purchase should be:

1)      Claims proposition

2)      Good relationship with and trust in the Broker

3)      Price

A case could be made for swapping 2 and 3 around, however I would challenge anyone to remove Claims proposition from the top. You will never need your Broker more than when you have a claim…

In reality though, most companies decide upon their choice of Broker via the following priorities:

1)      Price

2)      Good relationship with and trust in the Broker

3)      Other general reasons, maybe mutual friends or networking connections

Claims proposition is not a main benefit promoted by Brokers, often it will barely feature when a Broker is trying to secure your business as a client. That’s strange isn’t it?

Consolidation in the Insurance Broker sector has been constant since the start of my career. Nothing at all wrong with consolidation, Howden are experts in it!

However it is primarily a means of stripping out costs, indeed it is that which drives much of the benefit of growing larger.

A typical Insurance Broker can be split into three core functions. Alongside each of these functions is their contribution to the business from a revenue perspective:

· Account Executives                    Responsible for revenue generation

· Account Handlers                      Provide essential support for revenue generation

· Claims Handlers                        Not revenue generating

Put another way, the only one of those functions which is purely a cost is Claims.

To most consolidators and the largest national and international Brokers, increased revenue is the main driver and cutting costs is next in line.

You may have just drawn your own conclusion on why Claims is not the main benefit promoted by Brokers!

When next deciding who to appoint as your Broker, who you need working alongside you, guiding and supporting you in the event of a major claim, I would urge you to ask specifically about their Claims proposition. Who handles the claims and where would be a starting point…

Many will have centralised or totally outsourced claims functions now – hard to view either of those as a positive! Smaller firms may have a “Claims Handler” but by no means a Claims Department. And many more won’t have any Claims expertise whatsoever.

Account Executives should closely monitor how Claims are being handled, not do the handling themselves. Two very different skill-sets, one is development and relationship management and the other is neither of those, it is highly technical.

I will be totally honest, the only reason I can write this article now is because Howden, as a business, goes totally against the grain.

We are very heavily resourced in Claims and with a current team of thirteen between our Scotland offices, not only do we have the ability to react fast and provide the highest levels of local service, we also have an enviable depth of technical knowledge, shared throughout the multi-skilled team.

Howden stand out against competitor Brokers with our proposition, simply by being well resourced. That is quite concerning but it is the reality!

It’s perfectly reasonable for you to expect the service standards of your Broker to peak when there is a claim. It is very rare indeed for that to be the case, businesses are often left with little Broker support or influence and the Insurer takes control.

There will always be businesses which only focus on the price of insurance. For those who take a holistic view of the true value of Insurance products and service we can certainly assist.

If this is food for thought, I would be happy to have a discussion around our full service proposition, from policy placement through to claims management.

mark.amos@howdeninsurance.co.uk

07394 801577

#howden #insurance #claims #insuranceclaims

This blog is a copy of the following LinkedIn post:

https://www.linkedin.com/pulse/claims-service-primary-reason-buying-insurance-mark-amos-duc1e?utm_source=share&utm_medium=member_android&utm_campaign=share_via