Insurers’ Top Barriers to Catastrophe Claims Processing

Scott serves as Director, Operations Advisory at ReSource Pro

Are you ready for a claims surge?

Hurricane season is here and for many insurance carriers and TPAs, that means an influx of catastrophe (CAT) claims is on the way. Fast claims processing during these times isn’t just the hallmark of good customer service, it’s the key to avoiding potential property lawsuits, like those currently impacting the windstorm property market in Florida.

Unfortunately, overcoming a surge in claims, while also maintaining cost-efficiency, is often easier said than done. Here are three common reasons why carriers struggle to quickly resolve claims in the aftermath of a catastrophe.

1. Detailed accuracy and granularity of CAT forecasting

While catastrophe modeling is an excellent tool for carriers seeking to predict losses and potential claims surges, the ability to leverage it effectively can vary based on the carrier’s size. Larger carriers can afford more accurate and detailed catastrophe models and can typically plan around and respond to surges at scale. Meanwhile, smaller carriers often need to rely on less accurate and detailed models and may lack the resources to respond to claims surges effectively, even when they are foreseeable.

2. Limited ability to leverage data and other tools

Legacy systems continue to play a major role within many insurance companies. These systems often limit carriers’ ability to use data and integrate technology. For instance, there could be data “blind spots” in a carrier’s workflow management system that make actioning automation difficult. Additionally, a carrier’s claims system might lack the ability to import external information, such as weather data, which could be used to verify cause of loss and coverage in real-time.

3. Use of licensed staff for non-licensed processes

One of the costliest decisions carriers make when faced with a surge is to hand claims off to a third-party administrator (TPA) that uses licensed staff for every step of the claims process. Not only does this increase the expense to the carrier, but it impacts the time for claims to get out the door. With a few key exceptions—such as determination of coverage, applications of the policy provisions, and direction to pay—most steps of the claims process do not require the attention of a licensed professional to complete.

Discover a faster, better approach to catastrophe claims processing

Don’t let a spike in claims stop you from delivering excellent customer service. ReSource Pro helps carriers and TPAs process claims quickly in the aftermath of a catastrophe. We handle all non-core, non-licensed activities so that your core adjusters can focus on claim resolution and reduce turnaround time on crucial claim activities.

ReSource Pro claims handling enables you to:

  • Enhance the client experience – Timely intake, assignment and follow-up, and client communication ensure satisfaction and peace of mind
  • Reduce the cost of claims surges – No need to retain extra staff or a matrix of vendors to manage CAT events. Our output model can ramp up or down as needed
  • Take control of your data – Improve your ability to monitor, manage, and analyze data on behalf of your clients

Want to learn more about how we can support your insurance organization this hurricane season? Start a conversation with us.