In theory, the claims department plays a key role in how an insurer can differentiate itself from its competitors, however its usually price it the absolute factor that the consumer decides upon. From a loss assessors perspective, we would state that the same loss ratio should be applicable to all insurers if they are providing the same quality of product.
If the cost of claims at any point in time (including estimated future cost) exceeds the available resources to pay such liabilities, then the insurance / reinsurance company will technically be insolvent and must legally enter into one of the forms of insolvency available. Essentially this means that they cannot write new business therefore the estimation of future liabilities is an extremely important control conducted by the regulator for the general public.
It would be difficult to understand, if insurer A sells 1000 policies and insurer B sells the same over a five-year period that they wouldn’t both arrive at approximately the same loss ratio. How do they genuinely compete against each other?
From a claims perspective, possible ways could be,
- Incorrect advice, policy holders should be informed that they can appoint their own loss assessors. It would be important to note that the term loss adjusters and loss assessors mean two completely different things. The loss adjuster works for the insurance company and the loss assessor works for you.
- Inner conditional limits. Some policies provide a lot of inner conditions relevant to certain aspects of your policy, they can cap the overall liability of the insurer and indeed reduce the payment within your claim.
- Unjust enrichment. The incorrect advice regarding what items you are entitled to claim for, this is where the utilisation of a good qualified loss assessor will do you justice.
- Trick or treat. A Maam Cross approach to claim settlement which is in breach of every aspect of modern day consumer law.
- Repudiating claims. Unfortunately, this does occur to the general consumer which leads to a lot of financial hardship.
If you have suffered a loss and need to make an insurance claim, contact us to day for advice regarding how to obtain at least a 30% better settlement offer net of our fee.