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Business Process Validation to Increase Customer Satisfaction

Recently I was going through the NAIC (National Association of Insurance Commissioners) website (www.naic.org) and I came across a list of top 10 Closed Confirmed Consumer complaints. This site explains Confirmed Closed Complaints as those that have been investigated by the state Insurance Dept and have been given a resolution code; meaning the State Insurance department determines that an insurer or his/her representatives has violated a state / federal law or a term / condition stated in the Insurance contract. In simple words, Closed Confirmed Complaints are those that have violated a law or the spirit of the insurance contract and could result in serious customer satisfaction issues and credibility loss.  


According to the NAIC table (From NAIC site), the top three reasons identified for Confirmed Closed Complaints are Denial of Claim Handling, Delays in Claim Handling and Unsatisfactory settlement/offer of Claim Handling. These three reasons account for over 50% of the total complaints.


This is definitely not a pretty picture for Insurance companies, especially in this day and age of  social networking where a dissatisfied customer is much more than just bad publicity. These  unsatisfied customers have the potential to drive away new business and also shake up the confidence levels of existing repeat customers. On the contrary, earnest attempts to address the issues faced by these customers can get appreciated quickly and may just result in applause and greater business.

As an Insurer, you need to be proactive in identifying similar issues with your company and fixing them immediately, rather than waiting for the regulator to uncover it for you.  Considering the fact that many of the large insurer have automated substantial parts of their business process, I was speculating if it is possible to develop a framework for proactive business validation. If our objective is to differentiate ourselves from competition by being the best in customer satisfaction, then we should be looking at doing the following proactively:


1.    List out our top-10  Closed Confirmed consumer complaints (start doing this by taking the Top 10 list of Confimred Closed Complaints from the previous year)


2.    Conduct an end-to-end business process validation to identify the root cause for each of  the pain points mentioned as part of the consumer complaints. For example, if the pain point is 'Claim Handling - Delays', then the root cause uncovered could be that the external partners (Claims Adjusters) are not integrated into the process, thus leading to delays.


3.    The insurer will need to upgrade the business processes and supporting applications to ensure that the root causes are eliminated. Example, we can web enable or mobile enable the claims interface, so that the external claims adjusters can directly access the system.


4.    Repeat the Business Process Validation to ensure that the solution achieves desired results.


If the above 4 mentioned steps are done correctly, then we should see a substantial reduction in number of complaints mentioned against our the organization next year, especially in the 'Claim Handling - Delays' section.


The key element in this approach is end-to-end Business Process Validation and this needs to be driven by an internal / external business SMEs, supported by the testing team and BAs. If we, the insurer, is  able to reduce the number of complaints following year, then this will be a worthwhile effort/ process to follow.


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