grow, compete & succeed

Track A: Efficiency, Integration, Modernization & Growth Grow, Compete & Succeed: How Efficient Claims Drives Business

Sponsored by:

David M. McKenna, PMP Assistant Vice President, Director of Claims Metrics & Finance Selective Insurance

Grow, Compete & Succeed: How Efficient Claims

Drives Business

Dave McKenna, PMP Vice President, Claims Metrics & Finance Selective Insurance Company of America

[email protected]

Selective – An Overview

• Super-regional property & casualty carrier • $1.5B 2011 net premium written

• 80% CL 18% PL 2% E&S • Great people empowered to make decisions • Deep relationships with highest caliber agents • High degree of underwriting, pricing and claims

sophistication

How Efficient Claims Drives Business

• Driven by customer service • First-class claims experience • Loss cost control through best

practices and efficiency • Focus on the verdure of your

organization

Growth (n) - development from a simpler to a more complex stage


• Requires preparation and pro-activity • Change management and best practice

revisions • Constant technology evaluation • Collaboration and transparency

…a more complex stage


• Technology selection should not be entirely based on

current state • Learn from the R&D of software company

implementations • Customers will use channels they feel comfortable

with (i.e., Claim Report, etc.)

Don’t be afraid of internal social networking tools -- they enable collaboration and transparency.

Process can and should change…


• Remove the word “scorecard” • Develop internal analytics and financial support groups • Establish a foundation for change by federalized project

and process management groups

…ask for feedback at all levels, internal and external

Enable analytics, establish a foundation for coaching and mentoring…


What it looks like….

Loss

Expense

Customer Service

and Quality

Cycle Time

Measure Monitor Results

Manage Change

with Project

Oversight

Maintain Compliance

Over Communicate

at all levels and support the

customer


• A Foundation of • Process • Collaboration • Communication • Change control • Technology selection / enablement

Never lose focus on the customer.

Efficient claims and business drive are built on a strong foundation

Questions?

DO NOT DUPLICATE OR DISTRIBUTE. USE AND DISTRIBUTION LIMITED SOLELY TO AUTHORIZED PERSONNEL.

Copyright 2012 Selective Insurance Group, Inc.

Selective Insurance Group, Inc. is primarily a holding company for eight customer-focused property and casualty (P&C) insurance companies and

ranked as the 49th largest P&C insurance group in the United States by A.M. Best Co.

The information and materials included in this presentation are only suggested recommendations and following the suggested recommendations does not guarantee results.

Track A: Efficiency, Integration, Modernization & Growth Optimizing Claims Service, Efficiency and Loss Outcomes

Bonnie Kikkert VP - Claims Automation & Strategic Projects Selective Insurance

David Thornhill Senior Claims Manager AAA

Judy Merante Partner Inpoint, an Aon Business

Steven R. Henning MBA, CPCU, BRR, Senior Risk Specialist, Vice President Risk Management Swiss Re American Holding Corporation Sponsored by:

Panel Leader: Mark Snyder Principal Inpoint, an Aon Business

ACE 2012 Panel Discussion: Optimizing Claims Service, Efficiency, and Loss Outcomes June 28, 2012

Agenda

• Panel Introduction

• The Issues

• Key Questions for Discussion

• Panel Discussion

14

Panel Introduction

•Bonnie Kikkert Selective Insurance

•David Thornhill, Senior Claims Manager AAA

•Judy Merante, Partner Inpoint, an Aon Business •Mark Snyder, Principal Inpoint, An Aon Business

•Steven R. Henning, MBA, CPCU, BRR, Senior Risk Specialist, Vice President Risk Management Swiss Re American Holding Corporation

15

Agenda

• Panel Introductions

• The Issues



16

Industry focus on improving service and operational efficiency often come at the expense of increased paid loss

Customer Experience Provide a level of service that attracts new business strengthens retention and differentiates the product

Loss Containment Consistently paying fair and

accurate amount on each claim while containing related expenses

Operational Efficiency Achieving operational efficiency by streamlining the adjusting process leveraging the most cost effective

source

SERVICE

LOSS EXPENSE

Too much focus on one or two dimensions adversely impacts the others Easiest to manage Expense, hardest to manage Loss Carriers are developing new processes and systems to enable focus on all three

pillars of performance

P&C organizations traditionally lack a comprehensive approach to monitor claims performance, and continuously improve claim outcomes

With over 70% of every premium dollar flowing through claims, the ability to accurately monitor and influence the levers that impact claims performance is imperative

Claim executives today are not always equipped with the visibility and situational awareness needed to optimize claim outcomes and drive performance accountability

Traditional claim audits provide limited visibility into performance issues and have little impact on changing adjuster behaviors

Operational measures help understand claim handling efficiency and loss adjustment expense but provide little insight around paid loss, the larger driver of claims cost

As a result, overall claim quality suffers, impacting both financial results and customer service

Evidence suggests that without the proper visibility into claims quality, greater focus on service levels compromises financial performance

40

45

50

55

60

65

70

Customer Satisfaction vs. Loss Ratio High Loss Ratio, Low Satisfaction

Low Loss Ratio, High Satisfaction

Trade-off between Loss Ratio and Satisfaction

Low High

Loss

Rat

io

Customer Satisfaction

4

Agenda


• The Issues



20

Key Questions for Discussion

21

• As an industry, what are our greatest challenges to ensuring consistent best practice claim handling behaviors, and efficiently delivering proper claims outcomes?

• How can we best leverage available data and Claims Quality processes to increase business knowledge, and drive sustainable measurable improvements in claim outcomes while maintaining high levels of customer satisfaction?

• Holistically, what is the best approach for aligning and balancing loss, expense, and customer service?

• What is the best way to leverage social media and technology to

improve customer satisfaction and claim outcomes

Agenda


• The Issues



22

grow, compete & succeed

Business

businessefficient claims

efficiency focus

selective insurance

discussion panel discussion

aon business management

level of service

loss carriers

loss outcomesjune