Top 4 Qualities to Look for in a Claims Adjuster
It’s no secret that insurance providers’ profitability depends heavily on their claims adjusters. So, what characteristics do those adjusters need most of all?
Insurance leaders understand how critical it is for their companies to handle claims effectively and the important role adjusters play. But what exactly does it take to be a great claims adjuster? What characteristics should you look for when hiring, and what qualities should you encourage within your claims department’s culture?
Let’s consider the main demands placed on claims adjusters. Determining the appropriate amount to pay out on any claim is the most obvious way they can have a positive impact on your company’s competitiveness and profitability, but you also need your claims adjusters to process claims efficiently. And at the same time, claims adjusters also play a central role in shaping your company’s reputation and level of customer satisfaction.
Taken together, those needs require top-performing claims adjusters to have four key qualities:
The need to determine the appropriate amount to pay out on claims, combined with the business imperative of processing those claims quickly and efficiently, makes it particularly important for an adjuster to be smart.
When an adjuster receives a claim, they need to quickly gather and process accurate and relevant information, both about the claim at hand and about similar claims filed in the past. Then, they need to be able to use this information along with their own experience to make accurate decisions related to coverage, liability, and damages. That requires claims adjusters not only to exercise good judgment when processing information, but also to keep learning as they gain professional experience. Over time, that continuous learning should help them to handle claims with increasing speed and accuracy.
As important as it is for a claims adjuster to process information intelligently, first they must have access to the right information. To consistently have that access—and to be able to quickly and efficiently locate the right information at the right time—they need to stay organized.
Given the amount of information they must deal with and the speed with which they must deal with it, keeping it all organized is no easy task. But those claims adjusters who do manage to stay organized are at a major advantage when it comes to accuracy and efficiency during both the investigative phase of the claims process and the later negotiations.
Speaking of negotiations, top-performing claims adjusters need to be able to justify their decisions. Their justifications should be conveyed convincingly, showing that those decisions were reached fairly and that their reasoning was accurate. Depending on the claim, they could have to make their case to customers, external vendors, attorneys, and internal management. To do so successfully, they need to feel confident that they have managed each claim methodically and reached the right conclusions.
No less importantly, claims adjusters need to have confidence in their processes and decisions in order to be effective negotiators. The negotiation phase of claims management can play a crucial role, both in determining how much your company will pay out on any given claim and in shaping the overall customer experience. But while customer service is essential, successful claims adjusters also must be prepared for the possibility that a claimant will push to receive a larger settlement than is appropriate. And that means that top-performing claims adjusters need to have the confidence to stand firm (in a polite and professional manner) when necessary.
Given how highly the insurance market is regulated and how high the stakes can be for insurers, honesty among claims adjusters is as much a financial and legal imperative as it is an ethical one. Aside from the penalties insurers can face should a claims adjuster violate relevant laws, these companies’ business success relies heavily on their reputations. To build up and maintain a high level of trust among customers, it is critical to ensure that your company’s claims adjusters display integrity consistently.
Integrity also matters when it comes to your company’s internal evaluations. It is common for insurance companies to incentivize professional excellence among claims adjusters, which (ideally) means rewarding those adjusters who have the highest performance metrics. But for these incentives to be effective motivators, they must reward the right adjusters. And to reliably identify top-performing claims adjusters, your company needs to be able to count on its adjusters to be honest in their internal reporting.
Why is the claims adjuster’s role so critical for insurance companies?
One major reason that claims adjusters can have a major impact on insurance companies’ overall profitability is that these professionals play a big part in reaching settlements with claimants. If they are too willing – or too unwilling – to pay out to their customers, that can have a serious, negative effect on their employer’s profitability. As a result, it is crucial for insurance adjusters to be mindful of the dangers of underpaying or overpaying.
In addition, the speed and efficiency with which claims adjusters work can seriously affect an insurance company’s profitability. Because major companies can deal with a large volume of claims, claims departments’ operating expenses can have a significant impact on their bottom line. When these companies empower their claims adjusters to use their work time more effectively (while maintaining their reliability and accuracy), they can help make their claims departments more profitable.
At the same time, claims departments’ data can help other departments to optimize their own performance. For example, underwriters should consider past claims settlements when evaluating the level of risk created by future policies and set prices accordingly. By providing their colleagues in other departments with comprehensive and accurate data, claims departments can help them make well-informed decisions.
The Overall Impact of Claims Adjusters
It’s not hard to see the impact that claims adjusters can have on an insurance company’s overall success. Not only are they customer-facing professionals who can make the difference between a positive customer experience and a negative one, but the decisions they make regarding claims can significantly affect your company’s profitability. And the data provided by adjusters can help your company’s underwriting department to set the most appropriate prices for policies they sell, further helping your company to make a profit.
All of that makes it crucial for claims adjusters to display intelligence, organization, confidence, and integrity.
So, what’s new about that list of qualities? One major difference between being a claims adjuster today and being one in the past is that today’s data-driven technologies can empower any adjuster to display those four qualities. By automatically providing adjusters with the right information at the right time, you can now give every adjuster the ability to perform as well as their most successful peers.
How Five Sigma Empowers Claims Adjusters
Five Sigma’s AI-powered CMS automatically analyzes data from past and present claims and uses it to help even claims adjusters with little experience to excel in their jobs.
One especially important way that Five Sigma’s technology empowers claims adjusters is by offering them just-in-time guidance – which helps them to make well-informed decisions, to make those decisions quickly, and to avoid making costly mistakes. Our claims management solution also documents and indexes adjusters’ outgoing and incoming communications automatically, in addition to recording the key steps they take as they manage a claim. By automatically documenting this information, our CMS helps claims teams enhance their level of transparency.
Taken together, our claims management solution’s data-driven capabilities empower claims adjusters to perform with the intelligence, organization, confidence, and conscientiousness they need to thrive. This helps entire claims departments make sure each adjuster has the information and resources needed to manage claims efficiently and quickly, without compromising on reliability or accuracy.
For more on how your company can make the most of data-driven claims intelligence, check out our latest guide, Transform Every Claims Adjuster into a Top Performer, Using Claims Data.
Frequently Asked Questions
What is a claims adjuster (or insurance adjuster)?
Claims adjusters (or insurance adjusters) are professionals whose job involves investigating insurance claims and determining how much money a company should pay out. In addition, their work often requires them to negotiate in order to reach a settlement, to analyze data, and to keep records.
Many of these professionals are employed by insurance providers, third-party administrators (TPAs), and self-insured companies. However, some claims adjusters work on behalf of policyholders.
What is claims management?
Claims management encompasses the whole process of handling and resolving customers’ insurance claims – beginning with the first notice of loss (FNOL) and sometimes including the process of paying out to claimants. Although claims management plays a key role in determining the profitability (or unprofitability) of insurance carriers, not all insurance carriers handle this process in-house. Instead, some opt to outsource claims management to businesses such as TPAs.