Improving Your Claims Management Process Part One
Did you know that claims reported beyond seven days are considered late? This is because after one to three days professional claims handlers have missed the opportunity to mitigate time sensitive liability issues and keep the claims costs as low as possible. Starting the claims process sooner will allow the claim professionals to help control unwarranted concerns of those involved. This makes the process more efficient and will enable the claim cost to be contained.
Where to start?
A good place to start managing your public entity insurance claim is with the first notice of loss. Public entities should be challenged with the task of making sure the first notice of loss reaches the carrier as soon as possible. It is all a matter of liability and cost control which occurs during a period of time after the incident. If the accident is not quickly reported, it can promote a human response in the injured person that starts building resentment and distrust in everyone involved in settling the insurance claim.
This usually escalates to the point where the injured/damaged party becomes difficult to deal with and want to get additional payments for their aggravation because of delays. In short, when the claim is reported late, you may have deprived claims professionals the opportunity to get involved early on to help minimize the claim cost on your behalf. Various studies support that late claim reporting, depending on coverage, will add 15-75% to the claim value, simply due to missed opportunities that are no longer within the control of the claims handler.
Municipal Entity Best Practices
The top best practices for the claims management area are:
- A centralized & formalized (written) process for the collection of and reporting claims to the insurance carrier
- Incidents reported quickly (optimally 1-3 days but not beyond 7 days) so professional insurance claim handlers can limit damages
- Investigation reports/photos are completed after step 2 and retained for future use if needed
- Provide good communication links with claim handlers to expedite claim handling
This is the first post in our series on “Improving Your Claims Management Process,” stay tuned for additional posts that will help your public entity create the best claims management plan for you. Don’t forget to subscribe to our blog so that you will be first to know when we post a new industry tip! To subscribe simply input your email in the “subscribe by email” form on the right sidebar of this page.