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Disaster recovery claims response: when your brand is on the line

 

By Dara Banga

FCIP, CFEI

Canadians won’t soon forget 2013. It was an epic year for natural disasters, from the early summer floods in Alberta to the holiday season ice storms in Ontario and Atlantic Canada. And it was a costly year:

 

• The June rainfall and flooding in Alberta was Canada's costliest natural disaster in history, causing massive damage to homes, businesses, and public infrastructure, four deaths, 27 local states of emergency, and more than $1.7 billion in total insured losses.

 

• In July, record rainfall caused flash flooding in Toronto, resulting in $940 million in damages. It was the most expensive insured natural disaster in Ontario’s history and the second-most expensive weather event in Canada in 2013.

 

• Over the holiday season, an ice storm hit southern Ontario and Eastern Canada, causing $200 million worth of insured losses.

 

As reported by CBCNews in January 2014, insurance industry analysts put the year’s total insured losses from these disasters at a staggering $3.2 billion, making 2013 a record year.

 

For thousands of Canadian residents and business owners whose properties were lost or damaged, these disasters were life changing. The last thing they needed was a bunch of red tape when it came time to file insurance claims.

 

For many policyholders, how you respond to claims is the ultimate measuring stick of your worth to them as an insurance company. It’s one of those times your brand is on the line. According to Accenture's latest Global Insurance Customer Survey, fourteen percent of policyholders who submitted a claim in the past two years aren’t happy with the way their claim was handled, and 83 percent of those unhappy policyholders have switched or plan to switch insurance carriers.

 

Following the Alberta floods in June 2013, some insurers faced a backlash and public shaming after denying many flood claims. But a misunderstanding of coverage was more the real issue than claims response. The massive flooding made it difficult to discern overland flooding from sewer backups, and ambiguity surrounding the interpretation of wording related to water damage and sewer backup added to the confusion. In the end, some insurers decided their brand was worth more than the damage claims and reversed their decisions.

 

Will your brand survive a natural disaster?

A quick and comprehensive claims response is crucial. First, getting the process rolling as soon as possible can often help speed up recovery for the policyholder. Also, the right experts will help accurately assess the full value of the loss so reserves can be set accordingly, avoiding a lengthy and complex battle to reset reserves down the road.

 

But with your brand on the line, you should be taking measures to shore it up long before disaster strikes such as:

 

• Embracing technology. In recent years, flooding and water damage have exceeded fire as a source of insurance claims, so insurers are using new technologies to help predict extreme weather events and spot potential defects in sewers and other infrastructure.

 

• Being an education partner to your clients. Make sure your policyholders fully understand their coverage and how your claims handling process works to avoid surprises if disaster strikes. You’re also in a unique position to help educate them about disaster preparedness. Working together, you can make the recovery process a little less painful.

 

• Making the right choice of TPA if you outsource. With so much of your brand riding on claims response, it’s crucial to choose the right vendor, someone who provides professional service and supports your claim handling philosophy.

 

For the kind of claims handling experience your policyholders expect, give us a call at DSB Claims. With our 98.47% claim satisfaction rate, we’re committed to protecting your brand.

 

 

Submit claims to: claims@dsbclaims.com

Or Call us at 1-866-856-6335

 

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