The Claims Department is a Critical Component & Can be a Profit Center of the Insurance Company

A Training Program to Explain the Importance of Insurance Claims Professionals

This is part two of a webinar only for subscribers to Excellence in Claims Handling to explain the need for excellence in claims handling and how to create a professional claims department.

Insurance Claims Handling Today

In search of profit, insurers have decimated their professional claims staff. They laid off experienced personnel and replaced them with young, untrained, unprepared people. A virtual clerk replaced the old professional claims handler. Process and computers replaced hands-on human skill, empathy and judgment. Money was saved by paying lower salaries. Within three months of firing the experienced claims people gross profit increased.

Insurance is a business. Corporate insurers must show their shareholders a profit that pays dividends and increases the share price of the insurer. For centuries insurers understood that catastrophes, firestorms, windstorms, hurricanes and tornados could not be predicted. Some years the insurer will make profits and some years it will incur a loss. The prudent insurer recognizes, because of the impossibility of predicting all possible losses, they measured profitability over a decade or several decades. No insurer can measure its profitability for periods of a quarter of a year.

Insurance is a service business. The insurance contract is a collection of promises made by the insurer to those persons or entities who face risks of loss pay for an insurance contract that promises to protect the insured against the risks of loss the insured faces. The person or entity insured relies on the professionalism of the employees of the insurer who are called upon to resolve the claims of the insured and provide the protection promised by the policy.