A soft business environment, workforce issues and technology challenges – all exacerbated by an unstable economy – are among the major concerns for claim officers, according to a survey conducted by global professional services company Towers Watson. Findings fromTowers Watson’s sixth Property & Casualty Claim Officer Survey, Claim Implications, Challenges and Innovations, reveal that claim officers are finding planning more difficult and that they are expected to meet performance goals with fewer resources.
Claim officers' concerns reflect current uncertainty. Profitability/ROE is the main business challenge for respondents (71%), followed by top-line growth (63%) and a competitive environment (52%). Leading the list of claim-related issues is workforce management, cited by 77% of respondents.
Workforce management encompasses many facets of employee oversight, including attracting/retaining talented workers, building bench strength and keeping morale high. The other top claim-related matters are technology innovation (54%) and financial results (48%).
“We believe that claim officers expect the challenges generated by the current business environment to continue,” said Kathleen Cullen, Towers Watson senior consultant and coauthor of the report. “These challenges are both claim-related and workforce-driven, and are connected to overall operation and efficiency of the claim function, and to management of a transitional workforce.”
Cullen also noted a distinction in workforce management responses between the most recent survey and previous studies: “In past surveys, chief claim officers were focused on efforts to retain their experienced workers to maintain a competitive edge. That emphasis has now shifted toward attracting and developing critical-skill workers, potentially a sign of the times and reflective of the economy as a driving factor pressuring employee costs.”
When asked about specific workforce concerns, 71% of respondents cite organizational adaptability. The survey finds that, by far, large firms consider organizational agility and flexibility the biggest workforce challenge by a wide margin. Conversely, small and midsize organizations are more concerned with the second-biggest workforce challenge, developing/attracting critical-skill workers, which received a 67% overall response rate. Employee morale and engagement raised concern for 60% of all respondents.
Overall loss costs (61%) and customer service (69%) are more often viewed as critical priorities than loss adjustment expenses (44%). This is a change from our first survey, where expense costs were listed as a top priority by 79% of participants.
Brian Stoll, Towers Watson director and coauthor of the report said technology innovation is improving the customer experience, and making a difference in improving efficiency and boosting financial results: “Particularly in personal lines, managing loss and expense costs while enhancing customer service are compatible goals, and claim officers who focus on high quality service and faster claim cycle times achieve efficiencies through technology and process innovation, and clearly gain a competitive advantage. These innovative approaches offer the same opportunities for standard commercial lines.”