US Claim Solutions | Nationwide Insurance and Investigation Blog

Why Your Claims Department is the Source of All Complaints and How You Can Fix It

Written by Greg Church | Jan 5, 2022 12:36:17 AM

Consumers often complain about their insurance providers, don’t they?

And unfortunately, claims handling is the number one source for customer complaints, based on complaint data from the National Association of Insurance Commissioners on the 10 largest home and auto insurers in the country.

In fact, 68% of all complaints involved claims issues, such as low settlement offers, delays during the claim process, claim denial, and more:

**National Association of Insurance Commissioners 2019 Complaint Data

The promise of a fair and prompt reimbursement after a loss is the reason most people buy insurance in the first place. So they’ll pay their premium and go back to their life until the day they need to file a claim.

And that only ever seems happens when they’re having a bad day. Chances are, they’re already unhappy. This is a critical moment for providers to make or break the relationship with the insured.

But we first need to realize that there’s so much more building up to this moment. Even from before that premium was ever purchased.

 

Here are 7 reasons people hate their insurance providers (according to people):

  1. It’s complicated - most people don’t fully understand what they’re buying because insurance products are complicated. Between the technical terms and jargon, it can be tough for a nonprofessional to understand.
  2. It’s expensive - similarly, most people don’t know how premiums are determined. They don’t know how to calculate risk like an actuary so when they don’t understand what they’re paying for, of course they feel they’re overpaying.
  3. It’s intangible - insurance isn’t something you can hold and feel (other than the receipt). It’s hard for people to appreciate a product that they never notice.
  4. It has no immediate ROI - after purchasing insurance, there is no perceived benefit until an incident occurs. And even that is still directly associated with a negative life event.
  5. Claims get rejected - from the insured’s perspective, they can be a loyal, paying customer for years without seeing any benefit. Until that one fateful day, they call to file a claim only to find that they’re not covered.
  6. Premiums are constantly increasing - this again, stems from a lack of understanding on how premiums work, but the way they see it, they’ve already been paying and don’t want to have to pay more just for using it.
  7. And providers just can’t be trusted - many people have the sense that their insurance company is out to get them. And whether they’ve personally had a bad experience with insurance or not, enough people have to convince them it’s true.

 

But these all seem to stem from a general a lack of understanding - of fundamentally how insurance works.

And rightfully so, insurance is a complicated industry based on calculations of risk and the potential financial burden it places on both the provider and the insured.

So what can you do about it?

Get back to helping people. Help to educate them!

Savings are important (especially from people’s perspective) but providers need to put a bit more focus on service and education. When was the last time you saw an insurance ad that wasn’t about the cost or savings?

And there are a lot of providers who are already creating great educational content and programs that are helping people - not only to understand their insurance, but also how to lower their risk. Now that’s the real savings both insureds and providers can get excited about!

So why not double down on those resources? Instill these as crucial elements in the customer’s experience. That’s how you fix the real problem with complaints.

 

How can US Claim Solutions help you improve customer service?

We’re here to service your claims needs 24 hours a day, 7 days a week, nationwide. We bring extensive knowledge and expertise in both field and desk adjusting so you can deliver the level of service your customers deserve!

Email us at customerservice@usclaimsolutions.co or give us a call at (888) 701-1153.



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