How to be a Professional Claims Handler
To avoid claims of breach of contract, bad faith, punitive damages, unresolved losses, and to make a profit, insurers must maintain a claims staff dedicated to excellence in claims handling. That means they recognize that they are obligated to assist the policyholder and the insurer to fulfill all the promises made by the insurer in the wording of the policy.
An insurer can create a claims staff dedicated to excellence in claims handling by, at least:
- Hiring insurance claims professionals.
- If claims professionals are not available to hire away from other insurers, the insurer must be able to train all members of the existing claims staff to be insurance claims professionals.
- Training each member of the claims staff annually on the local fair claims settlement practices regulations.
- Supervising each claims handler closely to confirm all claims are handled professionally and in good faith.
- Explaining to each member of the claims staff the meaning of the covenant of good faith and fair dealing.
- Making clear to each member of the claims staff that it is the position of the insurer that all insureds and claimants are to be treated fairly and in good faith.
- Demanding excellence in claims handling from the claims staff.
- Being ready to dismiss any claims handler who fails to treat every insured with good faith and fair dealing.
If any experienced claims professionals exist on the insurer’s staff the insurer must cherish and nurture them and use their experience and professionalism to train new claims people. If none are available, the insurer has no option but to train its people from scratch using available materials and professionals who have – for a reasonable fee – the ability to properly and effectively train claims personnel.
When the claims staff is made up of claims people who treat all insureds and claimants with good faith and fair dealing and provide excellence in claims handling litigation between the insurer and its insureds will be reduced exponentially.
To keep the professional claims staff operating efficiently and in good faith they must be honored with increases in earnings and perquisites.
Conversely, those who do not treat all insureds and claimants with good faith and fair dealing should be counseled and given detailed training. If they continue with less than professional conduct they must be fired.
The insurer must make clear to all employees that it is committed to immediately eliminating staff members who do not provide excellence in claims handling and must be ready to publicly and quickly fire those who do not provide excellence in claims handling.
An excellence in claims handling program can include a series of lectures supported by text materials like the program I created for Experfy.com. It must be supplemented by meetings between supervisors and claims staff on a regular basis to reinforce the information learned in the lectures. To guarantee that the training and requirement for excellence in claims handling is effective the insurer must also institute a regular program of auditing claims files to establish compliance with the requirement to deal fairly and in good faith to the insured.
The insurer’s management must support the training and repeat it regularly. Management should be closely involved in all claims and required to audit claims files to determine that the training has taken and is being applied to each claim.
There is no quick and easy solution. The training takes time; learning takes longer. If the insurer does not have the ability to train its staff it should use outside vendors who can do so using available sources like this publication, training from professional organizations, and continuing education providers.
© 2020 – Barry Zalma
Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 52 years in the insurance business. He is available at http://www.zalma.com and email@example.com.
Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.
Over the last 52 years Barry Zalma has dedicated his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.
Read posts from Barry Zalma at https://parler.com/profile/Zalma/posts
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