Insurers pay out around two-thirds of collected premiums as claims payments to customers and claimants. Nevertheless, management often seems to focus more on reducing administrative and application processing costs than on optimizing claims costs. Then again, a claim is every insurer’s oft-cited “moment of truth”. In the event of a claim, the aim is to help the customer quickly and reliably, not only by assuming the costs incurred, but also by providing support, advice and services. For insurers, it is a matter of finding the right combination of customer orientation, efficient claims processing and reducing claims costs. The example of process automation thanks to digitalization and modern core IT applications shows that the three goals do not have to be in conflict with each other. For instance, swift claims processing that is transparent for the customer can not only increase customer satisfaction, but also reduce claims settlement costs.
Along our claims framework, we can systematically show what insurers’ statuses are in terms of strategy and governance, core claims processes (from prevention to recourse) and overarching areas such as IT and human resources, and where action is called for.