Providers must optimize technology to improve claims services in a market where SMEs find the processes complex and confusing and are vulnerable to loss.
A recent Financial Conduct Authority review has found there is a gap between SME expectations of claims handlings and the service they actually receive. It found that in a significant number of cases poor communication led to delays in reaching a settlement, and that sums insured were often inadequate to cover the value of the loss. SMEs were unclear who was responsible for driving claims outcomes and what action they should take to minimize disruption to their business.
SMEs rated claims as the most important service element as per our 2015 UK SME Insurance Survey. 25.9% of SMEs thought guidance through the claims process was most important; meanwhile an additional 15.8% stated the ability to track claims online was most important.
SMEs represent 99% of all businesses in the UK, so they play a vital role in the health of the economy. Compared to larger corporations, SMEs have fewer resources to sustain business following a large loss; therefore they are heavily reliant on prompt claims services that sufficiently cover their needs.
Technology needs to be optimized to keep customers at the heart of claims services. Streamlining processes will benefit customers through faster payment, which will minimize business impact following a loss. In turn it will also increase efficiency for brokers, insurers, and loss adjusters through faster turnarounds, reduced payments, and better retention rates.
Technology can be used to facilitate better communication with customers through claims tracking apps that give customers more confidence and guidance through the process. Big Data can also be used to more accurately assess how much cover is needed in the event of a major disruption to ensure customers are fully protected.
Providers need to improve claims services for SMEs as they are vulnerable to loss and require guidance. Not doing so would be a disservice, and has the potential to damage the health of the UK economy.
By Danielle Cripps, Insurance Analyst