Why insurers should prioritize responsiveness

Years ago, the insurance industry introduced the concept of 24-hour contact - where you would expect a call back within 24 hours of reaching out about a claim. Soon, same-day contact became the norm, where you might hear back within 8-12 hours. Today, we live in what is arguably the age of instant gratification – in our personal lives, we expect immediate responses and nothing less from the businesses we patronize. 

It's no surprise that policyholders are placing growing importance on carrier responsiveness and claim resolution. In fact, nearly 80% of the consumers surveyed in CapGemini's World Insurtech Report 2021 said they would switch carriers if their responsiveness were "less than stellar." 

So how should carriers approach first contact with claimants? Can time to first contact predict how well an adjuster will handle a claim journey from start to finish?

To shed light on these questions, Hi Marley conducted new research to study time to first contact (TTFC) - defined as the length of time it takes for an adjuster to contact a claimant once they've opted-into text messaging. The research analyzed customer data tied to a representative sample of 100 high caseload adjusters from across our carrier partners, including more than 2,500 customer satisfaction survey responses.

Time to first contact 

On average, the highest performing claims adjusters (HPCA) respond to 50% of their cases in or under three minutes. They demonstrate consistency in time to first contact, responding to 80% of their cases in under three-and-a-half hours (206 minutes). Conversely, lowest-performing claim adjusters (LPCA) take roughly two days (43 hours) or more to respond with first contact on 50% of their cases. 

Overall, claim conversation length shows that HPCA resolves claims 10% faster than the LPCA, averaging three days of reduced cycle time, which is significant. Take an auto claim, for example. An average daily loss of use rental rate associated with most auto insurance policies is approximately $45 per day. A three-day delay for 10,000 claims at an average of $45 per rental day can cost a carrier $1,350,000 per year. 

Responsiveness is a crucial

If carriers want to significantly impact customer satisfaction and retention, they need to start at the beginning of the claim, exceeding expectations from the very first interaction. According to a Hi Marley survey, speed of response is the most important customer expectation when texting with an insurance provider. Imagine if you were the claimant who got in a car accident; you would expect a response in minutes, not days. At the claims 'moment of truth,' nothing can replace the support and availability of a top-notch adjuster. We found that adjusters who consistently made timely first contact usually carried a sense of urgency, attention to detail, responsiveness and empathy throughout the remainder of the claim lifecycle.

Don't ignore customers' communication preferences

Every claim is unique. Consumers want the power to choose how they communicate. 

LPCA seemed more likely to ignore customers' communication preferences. The customer satisfaction survey responses showed that LPCA leveraged phone calls with policyholders that opted into texting, whereas this behavior is not noted in survey responses for the top performers. Adjusters who leverage phone calls after a customer expresses a desire to use text messaging will ultimately negatively impact customer satisfaction.

First contact and follow through

Time to first contact is indicative of follow-through throughout the claims process. Hi Marley's recent study found the second biggest driver of 5-star reviews is  timeliness of overall service, including fast response and prompt resolution.  

Our TTFC analysis found that 21% of surveys for HPCA mentioned response time, with almost perfect scores, averaging 4.93 out of five stars. When survey responses did not reference response time, the average score was about 8 percent lower (4.56), confirming that response time impacts policyholder satisfaction. 

Furthermore, we found that slower response times led to lower overall customer satisfaction scores. Policyholders expressed frustration beyond the quality of the first interaction, citing lack of proactiveness, explanation, progress updates or confirming receipt of requested documentation.

The bottom line

The shortest time to first contact can help predict how well an adjuster will handle the claim throughout its lifecycle. Adjusters who engage with customers quickly are more likely to take an empathetic approach and provide timely service and excellent communication throughout the claims process, ultimately driving higher customer satisfaction, lower cycle times and cost savings. 

Conversely, lengthy times to first contact resulted in a higher propensity for sub-optimal communication and a trend toward poor responsiveness throughout the claim's lifecycle, longer cycle times and lower customer satisfaction scores. 

Our analysis confirms that time to first contact offers a solid prediction of how an adjuster will handle a claim. Improving performance in first contact will yield measurable gains in customer satisfaction while also benefiting the business.