Life Insurance

3.5 Items to Know About Claims (Part 3)

Part 3 – Your claims process can become a revenue driver for the products!

In our first two installments, which you can find here and here, we discussed that your claims process is really a customer experience issue which a company can reduce expenses inside the claims process. This article is going to inquire about you to definitely think outside the box and disrupt the way in which a life insurance claim is processed. First, let's review a typical process for a life insurance claim:

  1. Claim process is initiated by the beneficiary.
  2. Claim packet is mailed to the beneficiary to accomplish.
  3. Beneficiary completes claim packet, includes any necessary documents and mails it back to the organization.
  4. Insurance company receives the claim and initiates an internal claims process. More documents or verifications may be needed, and requests are delivered to the beneficiary.
  5. Beneficiary completes additional requirements.
  6. Insurance company verifies and completes the claims process.
  7. Check is mailed to the beneficiary.
  8. Check is deposited into the financial institution from the beneficiary.

This is an extremely simplified version of the typical claims process. There might be some differences in this process from company to company. However, you get the basic idea of the process.

My previous experience as a top financial adviser at a major company led me to believe this process is stuck in the past, provides an undesirable customer experience and it is in great need of an update. Included in my adviser role, I had the opportunity to speak at events and gain the perspectives of other advisers. I also spoke with my clients to really obtain a sense of their experiences with filing claims.

Now, imagine with me that you're a financial adviser or agent for a life insurance company. You're the person who prospected the individual and identified a need for a life insurance policy. You built the relationship and gained the trust that enables you to sell a $1 million life insurance policy. GREAT! You just did them an excellent service. You offered someone peace of mind. Guess who gets to experience the forward thinking, care and love for the futures of spouses, kids, grandkids and legacy? The beneficiaries will be the only people who truly experience the amazing benefit their loved one left for them. Let me ask, would it be beneficial for you, the adviser, to supply an exceptional experience for the beneficiaries? Stay beside me.

What if the new claims process was a technology solution that allowed your company to create this adjustment to the claims process? It might look like this:

  1. Beneficiary initiates and completes the claims process on the digital platform that has all of the documents pre-filled for convenience. The platform allows beneficiaries to use their mobile devices to scan and upload any additional documents that are needed by the company.
  2. Insurance company receives all documents completed and signed. All documents and correspondence are associated with the correct claim instantly.
  3. Insurance company verifies and completes the claims process – all on a digital platform provided by the life insurance provider.

Here is where the revenue can be generated if your company is forward-thinking and truly wanting to become innovative. Remember after i asked you to imagine that you were a financial adviser?

Now step back into that thought process. What if your company electronically notified and looped you into the claims process? Would that be valuable to you because the adviser?

  • Would this allow the adviser/company to create a new relationship that's built, and continues, on an existing relationship?
  • What if your company electronically sent you pre-filled account opening forms and asked you, the adviser, to achieve out to the beneficiaries and help them through this process? Would that be valuable to the adviser?
    • Would the adviser have an opportunity to build a relationship with the beneficiary?
    • Would the adviser have chance to retain the $1 million instead of those assets getting deposited at a bank or competitor?
    • Would the adviser have an opportunity to present services or products that could benefit the beneficiary?
    • Do you believe the beneficiary would find value in this?

Now imagine that you are the beneficiary. Would it be helpful to complete the claims process quickly, efficiently and on your time frame?

  • Would it be helpful to have a professional help you with the process and $1 million benefit you are about to receive out of your loved one's good planning?
  • Would you need to leave exactly the same legacy for your heirs?
  • If the organization provided you with an excellent user experience, a professional to assist you thru the process and genuinely wanted to produce a lasting relationship along with you, can you consider using the services of this company yourself?

Based on my experience as a trusted adviser, I would find extreme value inside a company that engaged and embedded me into the claims process. In addition, advisers have been through this process many, often and can add true value to those who have not been through the process. After i was involved with the claims process, a few things happened:

  1. We were able to start a new relationship that is built on the common previous relationship. Most beneficiaries would think, “If dad trusted this adviser and company, I'm able to too.”
  2. We were in a position to continue to provide service to a family who had already experienced the value of what our company offers.
  3. We were able to offer a true benefit and meaningful solutions to the beneficiary.

Stay tuned for the final issue – Part 3.5: Your organization could be innovative and generate revenue with the aid of insurtech startups.

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