Major loss incidents are unique, each presenting their own set of challenges but one thing they often have in common is an immediate need to manage a caseload of, potentially, thousands of claims that can arise from a single catastrophic loss. Few risk management departments have the resources to deal with this and established Third Party Administrators lack the flexibility to adapt highly specific systems to unique, one off loss situations each with their own complex and often dynamic requirements.
Following such a loss our priority is to quickly establish a dedicated claims handling process tightly integrated to the requisite supporting infrastructure. Our team has the practical experience gained from events, including the Buncefield and Toulouse explosions, which serves as a template for fast track development of a bespoke claims process. Our experience includes: managing the requirements of multiple principal parties with differing interests; flexible options for resourcing the adjustment of claims and the use of adjusters and experts; recording, managing and leveraging claim data to meet the reporting and regulatory requirements of all interested parties; managing finances to ensure speedy settlements and developing tools for dynamic cash flow projection and dealing with the many financial and data compliance and audit issues that arise when dealing with a large body of claims.
Many parties are likely to have a financial interest, possibly including multiple Insured’s (co-owners), insurers and reinsurers (of each co-owner). Our approach seeks to align common interests and separate practical claims handling from global liability issues. This can be achieved with interim agreements of a steering group to provide the strong leadership essential to settle claims, cost effectively. We offer resource management for experts including adjusters, surveyors and accountants to quickly create a panel and ensure adequate resources are retained with particular attention to avoiding conflicts where, say, first party insurers may have a call on the same experts.
Delegated authority is an essential tool to manage costs but it requires dynamic management through the life of a major loss to monitor authority levels for effectiveness against a changing claims profile. Our experience allows us to efficiently manage this process together with formalising experts’ terms of engagement and providing authoritative reference procedures. A bespoke claims management system which enforces agreed procedures and funnels the efforts of the claims team into a productive and streamlined workflow, is the most important tool in the successful management of a multi-loss scenario.
There are many existing claims management systems but our experience is that it is more cost effective to employ Agile software development principles and iteratively build from a live bare bones system, recognising from the outset the dynamic nature of the project. The structured record of claims information provided by such a system, especially financial information, allows high quality business intelligence reporting including cash flow projections and provides a master claim file for detailed documentation on individual claims. Our information architecture supports workflow for delegated authorities and claims agreement while secured data sharing enables transparent processes with complete online claim records allowing drill down reporting.
A high volume of transactions creates audit risks and compliance issues. We are experienced in managing these by ensuring sufficient segregation of duties in claims processing and fulfilment and designing workflows that generate robust audit trails. We commonly use auditors to review not only transactions but also processes. When dealing with personally identifying information, Data Protection must be addressed, especially issues surrounding provision of data to users in different jurisdictions.
Ultimately, our approach to these complex situations is to bring to bear the experience gained from some of the largest losses in recent history to provide an agile and tailor-made claims process supported by systems embodying industry best practice at every level.