The way in which claims are handled says a lot about the values that the insurer involved works to. References to integrity and fairness will be weighed up and judged by claimants according to how they feel their claim has been dealt with. It is after all where the veracity of the promises wrapped up in the insurance policy come to be tested.
And that situation has not been lost on regulators, who seem to be besieging the insurance sector with reviews and investigations at the moment. On the claims front alone, there’s the Financial Conduct Authority’s (FCA) thematic reviews into personal lines claims and into private investigators, the Competition Commission’s (CC) investigation into certain motor claims practices and the UK Parliament’s Home Affairs Committee‘s review into private investigators.
Claims departments are under pressure to reform how they work. Established practices will have to be questioned and some critical thinking brought to bear on the underlying assumptions that drive ‘how things get done round here’.
Claims directors need to understand the big ethical issues that relate to insurance claims. There are issues of fundamental importance. Insurers who are conducting internal reviews into their claims operations will need to address each of these ethical issues or in all likelihood, risk having the FCA and the CC question their competence. The regulatory mindset now says that if you don’t recognise clear risks like these, then you could be ill equipped to spot other issues that should be on corporate radars.
Approach these ethical issues with an open mind. It’s important not to dismiss them by reference to having such and such a policy, ‘everyone does it’ or ‘that’s the way it’s always been’. Remember: if you want to be innovative in your claims handling, you need to be able to stand back, see the bigger picture and reflect upon why you do what you do.