rely upon the company that sustained
the loss as one of the links in its supply
chain, or as a key customer. Therefore,
it is critical to efficiently and promptly
manage the claims to mitigate the losses
to the greatest extent possible.
Added Benefits of Claims
Audits: Three Perspectives
Property claims management enhancements that are developed following objective claims audits can provide benefits
to three different major parties—the policyholders, the insurer, and the TPA or IA.
Several benefits apply to all three parties:
1. Improved communication/reduced
conflict in resolving claims.
2. More accurate payments.
3. Early resolution, thus allowing rebuilding to begin promptly.
Consider that there are also numerous
other benefits specific to each party. The-following items in the chart to the immediate right provides a few examples.
Major Parties Benefits
■ Prompt payment to repair or replace damaged/lost property to
get life back to normal as quickly as possible.
■ Reduced negative impact on quality of life.
■ Reduced negative financial impact on a business, its owners,
and its employees.
■ Reduced claims costs and expenses.
■ Improved use of vendors, thus providing greater expense control.
■ Satisfied/pleased customers, which should lead to higher
customer retention and recommendations to other customers.
TPA and/or IA
■ An improved relationship with the insurer or ultimate customer,
potentially leading to more business from that customer and
recommendations to other potential customers.
■ Improved cash flow if payment for its services is based on
prompt completion of the required tasks—for example, field
inspection and appraisal presentation.
Last month, we emphasized that work-
ers’ compensation claims require more
claims management rather than just
claims processing. Effective management
of property claims, on the other hand,
should be focused more on efficient pro-
cessing of the claim. Leading industry
practices or “best practices” in property
claims management place critical impor-
tance on timely and coordinated activities
and actions that allow the policyholder
to recover from the losses as quickly as
possible. A thorough audit can help to
identify where there are impediments to
efficient claims processing and resolution.