Tag Archives: associate in claims

We Need to Talk About Our Call Centers

I started my career in insurance at the same place where most of our millennials are starting theirs, in the call center. In my case, it was a Farm Bureau claims call center in the beautiful suburban campus in West Des Moines, Iowa. I didn’t know it at the time, but I got really lucky. That call center was very well run by enlightened leaders who realized they were training the future leaders of the company.

As early as the interview, managers told me that this call center was different. They understood that most of the new talent coming into the company would start in this department, and they had been instructed to engage and train those young professionals, so they would grow into productive employees not only during but after their time in the call center.

They said they wanted me to spend two to three years in the call center, while learning as much as possible about the company and the insurance industry in general. After that, I’d be expected to start applying for positions beyond the phones. The department also required each individual to obtain the Associate in General Insurance (AINS) and the Associate in Claims (AIC) within the first two years. Failure to comply with the educational requirement could lead to termination.

The way the call center functioned on a day-by-day basis was also quite engaging. Reps were trained well and supported in their efforts to grow their career (even when it meant time away from the phones for a class). The call center answered all first notice of loss calls for both personal and commercial lines claims, so it was not overly specialized; there was lots of variety on the day-to-day work. You’d get to keep the simple claims and work them to completion, acting as real claims adjusters. This resulted in great customer service, as roughly 40% of all calls would be answered by the person ultimately handling the claim. The approach also resulted in lots of employee growth.

Even the way that managers measured performance was not bad at all for a call center. While they did measure the amount of time you spent on “After Call Work” and “Unavailable,” it wasn’t the main thing they cared about. To the best of my knowledge, they didn’t measure the dreaded “Time on Call” that most call centers use as their main measure of productivity. The main thing that counted in this particular call center was the number of new claims you took and the percentage of those that you kept.

At the end of every week, management would send out a list of the top 10 reps who answered the most calls and kept the highest of those calls. I was almost always in the top two for both categories, and enjoyed the friendly competition. Because the list only included the top 10, not the bottom ones, people weren’t offended by it; it was a very positive thing. Management also included in the weekly newsletter a congratulatory mention of everyone who had passed an insurance designation test.

While at times the call center could get hectic, the overall environment was very supportive of employee growth, and nobody seemed to hate the job. Eight years later, most of the people I worked with in that call center are still in insurance, and none of them are still call center workers. Many stayed in claims. Many are still in the same company. That’s a successful insurance call center in our book! It was such a great place that I was sad to leave when I got an offer for a better claims position at Nationwide, which ended my call center days.

Sadly, I would find out as I met many other young insurance professionals that great insurance call centers that focus on developing their people are rare. Most are simply awful places to work, and, while nobody seems to be keeping statistics publicly, we have found 20 horror stories for every positive one.

There are many conferences about insurance, and none seem to be talking about our call centers. The CPCU Society Annual Meeting and Leadership Summit has not had a single session about call centers in at least the six years I have been involved. It’s almost as if those call centers didn’t exist! Or, more likely, the leadership just doesn’t view them as really being insurance.

It’s like the call centers are the black sheep of the insurance family that nobody wants to talk about!

A huge portion of young insurance professionals in the 2010s started their insurance careers in a call center type environment. Most of them already had college degrees (and the associated student loans). Like previous generations, they fell into insurance by accident, but, unlike previous generations, they won’t stay out of loyalty or out of having found great careers. If we do our job right and engage them in the industry, they’ll grow. If we don’t, they’ll leave the industry, and we’ll continue having a huge talent gap.

We’re not saying that we should close all the call centers and go back to doing business exclusively in the old-fashioned way. We understand that our expense ratio will not allow us to do that in the age of price transparency and incredible competition for every insurance customer. What we are saying is that we need to realize that, in many cases, the call center is our only touch-point with the customer, and we should be making them love their time with us. Maybe even more importantly, the call centers are our new entry level point for new talent, and given the talent crisis, our bad reputation with younger generations, and the high expense of replacing any employee, we need that talent to grow with us.

See also: How to Reinvent Call Centers  

Based on the horror stories we’ve collected from conversations with fellow young insurance pros who survived some time in the call center and lived to tell the tale, here’s what many (but  not all) of the insurance call centers are like to work in:

You have to be logged in to the phones every minute you are in the office and are not allowed to even be in the office outside of your work hours. There are rows after rows of grey cubicles, packed with unhappy 25-year-olds with their college degrees hanging precariously from the cubicle wall and the headset making a semi-permanent mark in their ear.

Engagement is so low that it could better be measured in level of desperation. Turnover is high, with the great majority leaving not only the company but the industry and swearing they’ll never work in insurance again. The reps who haven’t quite given up on the industry yet are applying desperately to any open entry-level position that’s not a call center. It doesn’t matter if it’s claims, underwriting, processing or subrogation. Anything will do just to get off the phones! There’s so many applying for the same jobs with essentially the same resume, college degree and one to two years of insurance call center experience, that’s it’s very hard to differentiate among them, so hiring managers mostly just reject them without an interview. Some have been told directly that “we don’t hire from the call center.”

They are measured on 50-plus different characteristics, so many that it’s impossible to actually focus on improving. Who can control that many different minor factors during each phone call? The most important measures tend to be Time-on-Call and Availability. The first one measures the length of the average call, with the goal of keeping it as low as possible, and the second one measures the percentage of the time they’re available to take calls. In some extreme cases, even mandatory team meetings count against you the same as time spent in the restroom counts against you.

Performance evaluations are focused 100% on metrics and very little on your own growth or what you need to do to get out of the call center. Most of the supervisors are former call center reps themselves who only know the call center life. They often don’t know anything else about the company or the industry and can’t serve as good mentors even if they wanted to.

Professional development is encouraged by the company, but development time allowed by the department is very limited or completely non-existent, leaving it to  the employee to do all growth activities outside work hours. A case could be made that a motivated employee can grow by investing his own free time into activities like insurance designations, Toastmasters and networking, but most have no previous insurance experience and no advice on what they should be spending their time doing to grow with the company. The only thing they know is that they don’t want to be on the phones, and they don’t want to become call center supervisors either.

We have even heard stories of call center employees being denied support in getting their basic insurance designations because they’re not required for the call center job the employees are doing. Some are denied even the ability to participate in activities such as Toastmasters or a young professional group because those meetings are in the office, and Human Resources doesn’t want employees to be in the office outside of work hours.

There are better ways to run a call center. Not only should others learn from the example of the Farm Bureau Financial Service center where I worked, but there’s even more that we can learn from the best-run call centers outside the industry.

Look at Zappos, which was founded on the crazy idea of selling shoes online. Think about that one: Shoes are the kind of thing that absolutely has to be tried in person, and, when you go shoe shopping, chances are you try multiple shoes before you find a pair that fits just right. Zappos succeeded selling shoes online by doing two things differently: The company will ship you as many shoes as you want, and then you can try them and keep the ones you want, returning the rest. Zappos will cover the shipping both ways.

The second thing Zappos does is provide amazing customer service. To provide that service, Zappos runs large call centers staffed by very happy employees. How does it keep call center employees happy? By doing things diametrically differently from most other call centers (including insurance call centers).

The hiring process consists of several interviews, mostly looking for personality fit. The HR rep conducting the first interview tries to simply figure out if this is a person he would want to work next to for 40 hours a week. Skills are much less important — skills can be taught. During the hiring process, Zappos makes it very clear that the great majority of positions are at the call center, and, if you take the job, you’ll be answering the phones for a long time.

Every new employee, regardless of position, must go through the call center training. You can be hired for a vice president role and on day one you get to go to your new office to set your stuff down, and then you come back down to train for the call center with everybody else. After finishing training, everyone gets to work the call center for a couple of weeks before going on to the job they were hired for. This guarantees that all the leadership knows what the call center is like. Currently, in insurance, there are very few, if any, senior executives who came from the call center, partially because those call centers didn’t exist or were much smaller when those executives were starting their careers.

After their first couple of weeks on the phone full time, all new Zappos employees get called into a huddle room with their manager. The conversation includes giving the employee real feedback about her performance in the call center. Then the manager reminds the employee that most jobs at Zappos are at the call center level and that it’s hard to move to a different area. Finally, the manager says something like “Charlie, I’ve got  a check in your name for $2,000. I want to pay you to quit. If you don’t love the job, take the money, and we can part ways, no hard feelings.” Zappos does such a good job in hiring, orientation and training that only 2% of people take the offer.

The way Zappos measures performance is very different from others, too. It doesn’t measure Time-on-Call at all. All Zappos cares about is making the customer happy. That may mean ordering a pizza for a customer who is traveling and doesn’t know where to get a pizza or chatting for seven hours with a customer about which shoes to buy for her prom.

Zappos understands that happy employees lead to happy customers, and that, in a world where your only interaction with the customer is when she visits your website or calls your call center, a call is a huge opportunity to connect with the customer. Zappos understands that a call center is NOT a cost center; it’s a key touch-point with our customer. What could be more important than that?

The insurance industry has a lot to learn from Zappos. As millennials become a bigger and bigger part of our customer base, and they are not fans of visiting an agent’s office, the call center becomes our touch-point with the 95% of our customers who didn’t have a claim in any given year. Also, if the majority of your new employees are starting at the call center level, it’s our only chance to get them to fall in love with the industry and to convince them to make a career here.

See also: Insurers’ Call Centers: a Cyber Weakness?  

For more about the Zappos way, I highly recommend the book Delivering Happiness by Tony Hsieh, the CEO of Zappos. This amazing book will give you a great intro to how Zappos runs its business, especially its call centers. The company also provides guided tours of its offices in Las Vegas. The company provides training and consulting for other companies through its consulting arm Zappos Insights. You can learn more here.

We are strong believers that the first large carrier to figure out how to turn its call centers into talent mines will have a major competitive advantage in the talent wars. Combine that with student loan aid and maybe with opportunities to take sabbaticals every few years, and you’ll create an unmatched employee experience that millennials will not want to leave.

This article originally published at InsNerds.com.

Bad-Faith Claims: 4 Ways to Avoid Them

An allegation of bad faith in claims handling can have far-reaching effects, including drawn-out legal battles resulting in potentially sizable settlements and damage to the organization’s reputation. But bad-faith claims are not always the result of an organization’s deliberate attempt to avoid paying a claim. Rather, they’re often the result of an oversight or miscommunication.

It’s this latter category that claims professionals should focus on. If an insurer is intentionally underpaying its customers or denying claims without valid reason, best practices are not going to improve the situation. But taking a step back and looking at the claims process at an organizational level is an effective way to identify gaps in knowledge or processes that can and do lead to bad-faith claims.

Before looking at some specific best practices for avoiding bad-faith claims, it’s worth reviewing the seven primary elements of good-faith claims handling, straight from The Institutes’ Associate in Claims (AIC) designation course materials

  • Thorough, timely and unbiased investigation
  • Complete and accurate documentation
  • Fair evaluation
  • Good-faith negotiation
  • Regular and prompt communication
  • Competent legal advice
  • Effective claims management

Using these seven keys as a baseline, organizations can further improve the claims process and reduce the risk of bad-faith claims by focusing on the following four best practices:

See also: Should Bad Faith Matter in Work Comp?

1. Exercise due diligence when investigating claims.

Claims representatives and their insurers’ special investigative units have a lot of experience detecting and investigating fraudulent claims and are trained to watch for specific triggers and red flags. However, a suspicious claim is not always a fraudulent one, and claims representatives must still conduct a fair and balanced investigation. Although this may be difficult, waiting until a definite determination is made is the most prudent way to go.

Even if a claim appears to be fraudulent, it still requires the same level of due diligence throughout the investigation–interviewing witnesses, inspecting property damage, reviewing medical records, etc. Proper documentation goes hand in hand with proper investigation techniques. Claims professionals should encourage the claimant to submit all relevant documentation or evidence, even if the claim seems fraudulent. This documentation may help clear up any uncertainties. And the investigation must be timely as well as thorough. Often, the timeline for an investigation is mandated by regulations or the specific terms and conditions of the policy. Sticking to this schedule is crucial to meeting requirements and maintaining your reputation with the insured. More and more, claimants expect timely updates with faster resolutions. It’s hard to blame them–people want payment for their medical bills or repairs to their homes. Insurers need to stick to the timeline they promised.

2. Rely on a solid claims system.

A good claims system that documents a claim’s progress is one of the best ways to protect your organization should bad-faith claims allegations arise. Claims representatives usually have a lot on their plates; a formal yet easy-to-use framework makes it easier to comply with regulations and the specifics of individual policies.

A robust claims system also helps maintain consistency. A lot of different people may access a claim or contribute to it, such as supervisors, auditors, underwriters and attorneys. Online systems that prevent anyone from changing information once it’s been entered help guarantee that everyone who touches the claim is up to date and on the same page.

3. Make use of experts and mentors to stay informed.

Having a strong support network is essential to anchoring the claims process. Any time a claims representative is unsure of how to proceed when processing a claim, she should know exactly where to go to get an answer and get the claim moving again. That includes an up-to-date claims manual with set procedures and a chain of command with decision makers who can resolve uncertainties during the claims process. Sharing this information should be a top priority during onboarding for claims professionals.

Continuing education is also key. Webinars, designations and state-specific resources detailing evolving regulations and case law are essential. Individual claims representatives should work to expand their knowledge in areas they frequently handle. If you primarily adjust residential claims, become an expert in that field, then use that knowledge to mentor other employees or act as the go-to source of knowledge on that topic.

The National Association of Insurance Commissioners, your state’s insurance department and insurance commissioner, your insurer’s legal and training departments and your direct supervisor are all good sources of information on regulatory standards. States have different laws and court rulings regarding bad-faith claims, and insurers have their own company-specific standards, as well. For larger organizations or individuals in the field who cover a large territory, it may be necessary to keep up with several states’ standards. One possible source: Unity Policyholders, which provided a survey and an overview of bad-faith laws and remedies for all 50 states in 2014.

See also: Power of ‘Claims Advocacy’ 

4. Have the right attitude.

Claims representatives can often facilitate the claims process simply by listening. Never lose sight of the fact that you may talk to people on some of the worst days of their lives. Sometimes, a person will call, upset and frustrated, and start talking about legal representation. It may be best to listen; it doesn’t mean that you’ll pay the claim or agree to everything they want, but you can offer some compassion and avoid becoming aggressive in turn.

Rarely will all parties agree during the claims process. The key is finding a balance between established procedures that rely on best practices while also leaving enough room in the process to treat each claim uniquely and provide a personal touch for customers.

Interested in learning more about good-faith claims handling? Take a look at The Institutes’ Good-Faith Claims Handling course. For broader claims knowledge, learn about The Institutes’ AIC and Associate in Claims Management (AIC-M) designation programs.