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How will your policy respond when you need to make a claim?

How will your policy respond when you need to make a claim?. Candy Holland ACILA, ACII, BA (Hons) & Nick E ntwistle ACILA, ACII, BA ( Hons). FCA Claims thematic review.

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How will your policy respond when you need to make a claim?

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  1. How will your policy respond when you need to make a claim? Candy Holland ACILA, ACII, BA (Hons) & Nick Entwistle ACILA, ACII, BA ( Hons)

  2. FCA Claims thematic review “It was felt by the group that if we could educate the customer on how the claims process will work, then that might actually increase the satisfaction numbers the FCA is seeing” Andrew Gibbons Chairman of BIBA claims working group Post Magazine 17th April 2014

  3. The claim process

  4. Notification

  5. Investigation

  6. Quantification & Validation

  7. Settlement

  8. Typical claim challenges

  9. Typical claim challenges Communication and interfaces

  10. How prepared are you? Level 1 Broker wording review Independent coverage review Level 2 • Meet insurers claims team & • agreeclaims procedures Level 3 Level 4 Internal claims plan • Explore hypothetical loss scenarios Level 5

  11. Developing a joined up approach Create a claim plan which defines and maps your internal processes Stress test your policy coverage to find out how it will operate when a claim arises Develop a claim protocol with your insurers to agree how they will deal with your claim

  12. Create a claim plan • Identify the possible parties who would be involved • Nominate a claims project team • High level sponsor • Immediate response, who does what • Loss quantification and preparation • What data & information is held and where • How you will record and capture it • Communication planning • Lines of reporting and timescales • Stakeholders, internal management and external parties • Regular and frequent meetings/ calls/ reporting updates

  13. Claims and BCP “There are different schools of thought about how the relationship between the claims process and the business continuity management and associated recovery process should operate. For me they are inextricably linked, although the link should be forged much earlier in the management process than after a claim. It never ceases to surprise me how any recovery time objective can be forged by business continuity managers and business interruption insurance solutions designed by risk managers without these being simultaneous and fully engaged processes” Julia Graham President of FERMA

  14. Typical claim challenges

  15. Where problems arise • Limits, sums insured, indemnity periods • Deductibles • Policy language • Trigger • Exclusions • Warranties • Conditions • Definitions • Disclosure Unexpected Policy Response

  16. Claims Conditions • Claims Notification – some examples “as soon as possible” “as soon as practicable” “as soon as reasonably practicable” “as soon as is reasonably practicable but not later that 30 (thirty) days after the Information Holder is advised of the event.” “as soon as is reasonably possible but no later than 45 days after the occurrence of said loss or damage”

  17. Gaps in cover • Ambiguities in interpretation • Uninsured exposures • Queries • More information • Changes in practice • What is the deliverable? • When to do it? • Who to involve? • Agree terms of reference • Business risk or exposure • Recent near miss • Coverage uncertainty • Previous claims experience • High profile event • Quantification & evidence • Assumptions • Identify & test heads of loss • Loss mitigation • Evaluate the financial impact • Analyse the policy wording • Apply coverage to loss scenario

  18. Developing a claim protocol • How insurers deal with claims • Agree key elements of the claims process • Minimise potential for dispute at the point of claim • Expedite the claims process • Practical working document • Binding when incorporated into the wording • Tripartite agreement - Client, Broker, Insurer • Timing • Reinsurance?

  19. The content • Pre agree advisers and experts • Deal with any confidentiality issues • Reservation of rights • Claim notification procedures and timescales • Interim payments and information requirements • Clarify any ambiguities in the policy wording • Pre-agree a basis for valuation of claims • Master and local policies

  20. In conclusion... • Some issues are unavoidable • Some issues can be anticipated and prepared for! • No single correct approach • 3 part plan • Claim plan • Stress test • Claim protocol

  21. Buncefield

  22. Thank youVisit us at stand 73 Candy Holland ACILA, ACII, BA (Hons) & Nick Entwistle ACILA, ACII, BA ( Hons)

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