Of the major concerns for claim officers are a soft business environment, work force issues and technology challenges, which all are worsened by an unstable economy, according to a recent survey by Towers Watson.
The survey finds that profitability is the top business challenge for respondents at 71 percent. Top-line growth comes in at 63 percent and a competitive environment is next at 52 percent. Regarding claim-related issues work force management is the biggest challenge at 77 percent of respondents. Work force management includes employee oversight, attracting and retaining talented workers, building bench strength and keeping morale high. Technology innovation is the next highest at 54 percent and financial results are cited at 48 percent.
"We believe that claim officers expect the challenges generated by the current business environment to continue," says Kathleen Cullen, Towers Watson senior consultant and coauthor of the report. "These challenges are both claim related and work force driven, and are connected to overall operation and efficiency of the claim function, and to management of a transitional work force."
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"In past surveys, chief claim officers were focused on efforts to retain their experienced workers to maintain a competitive edge," Cullen says. "That emphasis has now shifted toward attracting and developing critical-skill workers, potentially a sign of the times and reflective of the economy as a driving factor pressuring employee costs."
For specific work force concerns, 71 percent of respondents say organizational adaptability is the biggest problem, especially among large firms. Small- and mid-size firms, however, are more worried about developing and attracting critical-skill workers at 67 percent. Employee morale and engagement is an issue for 60 percent of respondents.
Overall loss costs at 61 percent and customer service at 69 percent are considered as bigger critical priorities than loss adjustment expenses at 44 percent, which is a drop from Towers Watson's first survey that listed expense costs as a top priority by 79 percent of participants.
"Particularly in personal lines, managing loss and expense costs while enhancing customer service are compatible goals, and claim officers who focus on high quality service and faster claim cycle times achieve efficiencies through technology and process innovation, and clearly gain a competitive advantage," Brian Stoll, Towers Watson director and coauthor of the report. "These innovative approaches offer the same opportunities for standard commercial lines."
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