What is Claims Management and The Importance of it

Claims management is a vital aspect of the insurance industry, and its effective execution has a direct impact on the performance of insurance companies. Claims management refers to the process of handling insurance claims made by policyholders, which involves a range of tasks from receiving and reviewing claims to making payments or settling disputes. Efficient claims management can lead to improved customer satisfaction, increased retention rates, and reduced costs for insurance companies. In this blog, we will discuss the importance of claims management and its impact on the performance of insurance companies.

Claims management is a complex process that requires a high level of expertise and attention to detail. Insurance companies must have a robust system in place to handle claims effectively, ensuring that policyholders receive prompt and fair settlements. This process involves a range of tasks, including claim intake, review and investigation, claim processing, and payment or dispute resolution. Claims management also involves communication with policyholders, ensuring that they are kept informed throughout the process.

The importance of claims management cannot be overstated. The way in which an insurance company handles claims has a direct impact on its performance. Insurance companies with efficient claims management systems can process claims quickly and accurately, resulting in higher customer satisfaction rates. This, in turn, can lead to increased retention rates and improved brand reputation. In contrast, insurance companies with inefficient claims management systems may experience delays in processing claims, leading to frustrated policyholders and negative reviews.

Effective claims management can also lead to reduced costs for insurance companies. By streamlining the claims process and minimizing errors, insurance companies can reduce their claims processing expenses. This can result in increased profitability, which can be reinvested in the company or passed on to policyholders in the form of lower premiums.

One of the key factors in effective claims management is the use of technology. Technology has revolutionized the insurance industry, and claims management is no exception. With the use of automation, insurers can process claims faster and more accurately. For example, claims management software can automatically route claims to the appropriate department, reducing the time it takes to process a claim. Additionally, claims management software can identify claims that require further investigation, flagging them for review by an adjuster. This can help insurance companies identify fraudulent claims, reducing the risk of paying out on illegitimate claims.

Effective communication is also essential in claims management. Policyholders expect to be kept informed throughout the claims process, and insurance companies that fail to communicate effectively risk damaging their reputation. Insurance companies should have a system in place to keep policyholders informed at each stage of the claims process, including updates on the status of their claim and any actions taken by the insurer.

Finally, it is important for insurance companies to have a strong team of claims adjusters. Claims adjusters are responsible for investigating claims, determining the validity of the claim, and negotiating settlements. They must have a high level of expertise in their field and be able to communicate effectively with policyholders. Insurance companies that invest in the training and development of their claims adjusters can ensure that they have a team of experts who can handle claims effectively, resulting in improved customer satisfaction and performance.

What We Do

Lexelle is a UK-based company that specializes in legal expenses insurance policies. Our company has partnerships with several established UK insurers, both manufacturing and co-manufacturing a range of insurance policies that are distributed to UK insurance intermediaries. Lexelle has extensive claims handling capability to manage claim matters on your behalf, with the additional benefit of our Group law firm, PM Law which can provide Legal Advice and Litigation Services to our Customers.

In addition to manufacturing and co-manufacturing legal expenses insurance policies, Lexelle also manages and administers claims, including for third parties. Claims management is a complex process that requires a high level of expertise and attention to detail. Lexelle’s claims management system ensures that claims are handled efficiently and effectively, minimizing errors and delays. Each year we handle thousands of claims for a variety of organisations, ranging from recovery of uninsured losses to management of claims on behalf of Insurers. We can tailor our service to meet your specific requirements, incorporating various suppliers as and when required.

By providing legal expenses insurance policies and claims management services, Lexelle helps to reduce the financial risk for policyholders and insurance intermediaries. In the event of a legal dispute, policyholders can have peace of mind knowing that they have financial protection in place to cover legal costs and expenses. Insurance intermediaries can also benefit from reduced financial risk and increased customer satisfaction by offering their clients a comprehensive insurance package that includes legal expenses insurance. With our proactive claims fulfilment and careful cost control measures, we have successfully managed to reduce claims leakage and overspend with a number of our previous partners. We maintain competitive claims handling fees and have excellent relationships with numerous suppliers.

Treating Customers Fairly is a real focus, we aim to get our claims handling decisions right the first time, and this is evidenced by our very low rate of claims decision overturns by the Financial Ombudsman Service – something we are keen to maintain.

Some of our activities and capabilities include:

  • Initial advice is provided by a dedicated in-house claims management team and as appropriate passed on to the specific specialist Panel Firms.
  • Lexelle manages all legal expenses schemes to target loss ratios:
    • Lexelle has become a ‘go to’ TPA for Delegated Authority claims handling, returning high levels of customer service together with efficient claims handling and policy administration services
    • Lexelle has never burned an Insurer in respect of legal expenses products – not even for Landlords Legal and Rent Guarantee cover during the pandemic – an achievement in comparison to competitors. When UK General was reviewing their partners ahead of changing capacity providers, they cancelled arrangements for several Legal Expenses schemes due to performance issues but continued to work with Lexelle.
    • Under the control of Lexelle, a market-leading Landlords’ Insurance scheme that had previously burned Insurers DAS and MSL has performed within target loss ratios
  • Lexelle monitors all claims activity and identifies patterns/issues and takes action as appropriate – such as changing policy wordings, updating training guides or where necessary, removing products that are no longer fit for purpose. A monthly Operations meeting and quarterly Products and Pricing meeting provide the forums for these discussions
  • Lexelle has had less than 10 claims decisions overturned by FOS in over 20 years
  • The customer is very important to Lexelle – a vulnerable customer policy is in operation, and the setup of Lexelle within a Group of Legal businesses provides many benefits, not least to the customer journey
  • Lexelle has developed an action plan in line with the new Consumer Duty and has commenced implementation of activity to review products, pricing, and processes

For any more information on any of our products, why not contact us on:

Telephone: 0114 350 4107

Email: sayhi@lexelle.com

Or fill in our enquiry form here – https://lexelle.com/contact-us/

We’ll be happy to help!