McKenna on technology – Zurich transforms claims payment processes into key selling point

Group risk providers’ payment processes speak volumes about them. Zurich is setting new standards in the field, says F&TRC director Ian McKenna

At the risk of stating the obvious, surely the most important part of any insurance contract is the way in which claims are paid; after all, this is what people pay their premiums for. But for some reason, especially in group risk, other subjects tend to grab most attention.

In the past year, Zurich has done some outstanding work by taking a totally different approach to claims payment. This has resulted not only in a significant acceleration in the time taken to pay critical illness claims but also in major improvements to the claims payment process to make it more customer friendly. 

With the company having just announced a new flexible group income benefit, it is a good time to explore some of the changes it has made.

In January 2014, Zurich began an extensive analysis of its claims payment process as part of a wider review the company is conducting to ensure everything it does is built around meeting the needs of customers. 

At the outset, Zurich identified 140 ways in which it believed it could enhance claims payment processes. These were then prioritised and 22 have already been put in place with dramatic results. The company has since cut the average time taken to pay such claims from 50 days to 27.

In addition to speeding up claims payments, Zurich focused on making the entire process more user friendly. Anyone claiming on a critical illness policy is likely to be experiencing some level of stress so it is important to provide them with positive support and empathy. 

Zurich has facilitated many of these changes through extensive use of technology. Customers can choose how they want to be kept updated on the progress of their claim, whether by post, phone, text or email, although Zurich realises that some updates require a phonecall to provide emotional and practical support.

Voice recording is used as authentication so there is no need to fill in forms, and one call is all that is required to proceed with a claim. In addition, customers are encouraged to submit medical evidence electron–ically to save time on postage and in chasing medical professionals.

When it comes to paying out, customers can choose from flexible payment options, including electronic transfer. Equally, Zurich increasingly pays customer costs directly, such as funeral charges or mortgage repayment, to reduce the stress on bereaved families. 

In cases where the customer is able to provide copy evidence from their doctor, Zurich will pay the claim in full soon after it has been submitted, once the medical report
has been verified.

An online ‘claim steps’ map provides a step-by-step guide and summarises each stage of the process, including providing useful contact numbers. 

Zurich has also invested in the development of soft skills among its claims specialists, including empathy and understanding grief, enabling them to focus on the ‘what’ and ‘how’ of a call as well as on the practical side of processing a claim.

All of the above are good, practical steps that can lead to a greatly improved customer experience. While these changes have been applied initially to critical illness policies, I understand they will be applied across all related contracts in the near future.

One of the most common messages I hear from insurers is that customers’ selection of a policy should not be based on price alone. Claims payment processes are clearly an area in which insurers can differentiate themselves and it is great to see a company investing in such changes.

Other insurers could learn from Zurich. I can see a clear case for bench-marking insurance claims procedures and using this as a major factor in recommendations. 

By definition, employers who set up group risk cover for their staff clearly care about their wellbeing, so the quality of claim payments and processes is likely to be an issue that they would regard as important when selecting an insurer.