Claims management is one of the key processes of any insurance company. An effective claims management system will have a great positive impact on the company, regardless of its size. It takes care of many operations like opening, closing and reopening of claims, making payments, coordinating with service providers, etc. A good insurance company will manage all these operations efficiently by abiding to the Government rules and at the same time by taking care of the customers.
Managing claims effectively is important to stand strong in the market or to build trust among your customers. This can be a key to differentiate your insurance company from your competitors.
Here are some benefits:
To settle claims in time
Settling claims involves two stages – customer reporting the claim and you as an insurance company investigating and settling it. It is important for you to record, investigate and settle it quickly, adequately compensating the claimant.
An effective system helps your company execute the process flawlessly within time. It helps you in the following three ways to ensure claim settlement happens in time.
• Filing: Claim process starts with claimant’s complaint. You can record the complaint and start investigation. Record all the details and examine them carefully in order to avoid fraudulent claims.
• Measuring: After investigation and examination, evaluate the amount if the claim is proved.
• Settling: After evaluating, the claim success is reported to the customer and the amount is settled.
To minimize costs
Minimizing costs is directly proportional to profits of your company. Delay in settlement can cost your company badly. This is because, insurance company will get a share from claim monitoring cost, that customer pays with his premium. The amount your company gets is determined by the swiftness of your claims’ settlements.
Another method of minimizing costs is automation. Most of the basic elements of claims process are common to all the claims like first notice of loss (FNOL), segmentation and assignment, investigation, subrogation, etc. So, they can be automated till the common point and the rest of the procedures can be customized at final stages to speed up the process, save costs and to get high customer satisfaction.
To avoid fraudulent claims
Fraudulent claims are the greatest challenge to any insurance company. Insurance companies have to settle claims quickly and at the same time they must avoid fraudulent claims. In a hurry to settle, many companies succumb to fraudulent claims. This will affect company badly especially small insurance companies, who operate with small budgets.
Examining payment history, observing payoff trends and identifying claimants who are claiming frequently will help insurance companies identify and avoid making fraudulent claims. Claims management system can be very helpful in tracking these things.
Leave a Reply