The brand risk is often better managed by focussing not only on "what you do" but "how you do it". Resolving cases quickly and fairly will, usually, deflate any immediate reputational impact and in many cases even enhance it.
On the flip side, where there is no fault it can also be harmful to just open the chequebook. It is understandable to focus on the concept of "customer is always king " but it is important to do so with informed knowledge of the impact on both immediate claim costs and, ultimately, insurance premiums. This is particularly relevant in this hard insurance market.
At the roundtable we discussed the example of one insurer client who asked us to review claims spend in relation to an insured who regularly insisted on certain types of claims being paid, regardless of whether there was any fault. Over a three year period, the additional spend was sizeable and this ultimately left the insured struggling to secure insurance.
Paying regardless of the circumstances and avoiding litigation at any cost will also bring its own type of reputation - word gets out. Of course, matters should never be allowed to just slip into litigation and at the roundtable participants were rightly keen to emphasize that economics can and do play a key part in any decision making process.
Nevertheless, litigation can be a powerful tool, showing that a business has principles and conviction in its risk and controls. The easy example is when there is suspicion of fraud and attendees agreed that this was their focus. Pursuing fundamental dishonesty has become part of the armoury in such cases, though the extent to which a business will go will depend on the sensitivities of the particular case.
One of the more recent challenges is the rise of angry customers who are not prepared to accept a quick solution or speedy redress. Social media naturally adds a further layer of pressure, particularly when posts and the truth do not always coincide. This was a trend that some attendees clearly recognised and were grappling with. One tactic is to push such cases out to advisors to bring some distance, but a clear strategy and approach needs to be agreed at an early stage to manage any impact.
At the end of the day, a balanced and flexible approach to brand management will always be key - one size rarely fits all.
If you require more information about our approach to supporting businesses with their claims portfolio, insured or otherwise, or would like to discuss any points raised in this article please contact Archana Makol.