November 17, 2017 by Emily Atkins, Editor
Balu Naidu and his partner, Raj Mody, have a unique business model for Claimstech, their independent adjusting firm.
The boutique firm, based in Mississauga, Ontario, offers a wide array of claims services, from personal and commercial property and liability, to injury and accident, transportation and catastrophe adjusting, as well as support for litigation, mediation, and arbitration.
That’s a wide array of expertise, but where they really stand out from the crowd is in their commitment to training the next generation of adjusters. The partners have developed a three-month training program for new recruits to the claims business designed to help mitigate the growing shortage of adjuster expertise.
Claimstech has been on the independent adjusting scene for four years now. Balu and Raj started the business in 2013. At present they have three adjusters working with them.
A year ago they set up a satellite office in Calgary, intending to be able to respond to catastrophes when required. Both partners and the business itself are licensed to operate in Alberta.
Further expansion, with a dedicated team in Calgary and possibly also Fort McMurray is in the works. Claimstech has set its sights on the Alberta cat market, and with more than 3,000 cat claims under his belt, Balu has seen almost everything Mother Nature can serve up. He points out that Alberta, with its extreme weather, is a good place to offer these services. Balu has significant experience in the province, having worked in Calgary with Crawford before returning to Ontario to start Claimstech.
His past experience also led to the creation of the adjuster-training side of the business. While he started his career in Kenya teaching finance, he’s been in Canada since 1990 and has been teaching CIP courses for 15 years. Raj also teaches, with 10 years experience as an instructor.
A professional development focus
With Crawford, Balu was extensively involved in creating and teaching courses for the company’s adjusters. “”“I trained adjusters from coast to coast,” he says, and that’s what helped him identify training as the industry’s greatest need.
“There’s a lack of specialized skills and knowledge and also specialized training for new people coming into claims adjusting,” he notes.
The industry as a whole is facing the challenges of the retirement of the baby-boomer generation, coupled with merger and acquisition activity that is causing layoffs and reducing the number of employers.
“Layoffs mean further loss of [adjusting] expertise, which is where the independent adjusters really provide the depth of experience to the insurers, and also fill in the gaps due to lack of resources—our manpower is available,” Balu says.
Claimstech’s response is to bring new people aboard and give them a broad exposure to the claims adjusting business.
The company is reaching out to millennials—recent grads who may not know where they want their career to go—to gauge their skill sets and aptitudes for the insurance industry. As experienced adjusters know, it takes a person with an interest in learning something new every day to become good at the job. Before taking on a candidate Claimstech checks for people skills, problem solving and interest in continual learning.
And this suits the millennial generation well, Balu says. It’s normal for them to change jobs every couple of years, he asserts, so the adjusting profession is good for them, “it’s not boring, not doing the same thing over and over”.
Still, he notes that there is quite a bit of persuasion required. “You need to sell our profession to young people coming in, as to what is in it for them. That’s what it’s coming down to.”
“We tell them: ‘If your interest is to be learning on a daily basis then this career is for you,'” he says.
Once selected for the program, the recruits learn every aspect of claims so they have a broad exposure that will guide them into selecting possibly a specialty later on.
“You need to get a grasp on each and every area of the claims process, then you are focused and you find you’re longing for more,” Balu says. “That’s pretty much what happens to the millennials because otherwise they get bored.”
The company has had a 70 percent placement rate for its trainees so far. “We have fulfilled our goal of providing manpower to the insurance industry,” he adds.
A modern approach to competition
One of the biggest challenges for Claimstech, along with other small IA firms, Balu says, is competing with the big firms for files. The partners have taken a two-pronged approach to business in this competitive environment.
First, they focused on their own business processes, which they have established as completely paperless.
“We are providing the best possible services at a lower cost,” he says. “And that created a strength for us.”
The idea came about when he worked at Crawford. By going paperless there, he was able to “downsize filing storage space from about 500 square feet to probably 200 square feet.”
So when the Claimstech partnership came about Raj and Balu readily agreed that they needed to have this economical, modern and IT-oriented philosophy informing their business practices.
“When you visit our office, you’ll see our desks and the phone,” Balu says. “There are no filing cabinets, nothing at all.”
The company keeps all its data in the cloud, relying on Microsoft Office Pro, tablets and smartphones. Balu emphasizes the importance of strong security and good practices, noting backups and frequent password changes.
He believes in this tech-forward approach, which enables staff to quickly capture and share images of claims, as well as making it possible for the insurers they work with to also have immediate access and securely download materials from the cloud. “This is where we’d like to be different from other independent insurance adjusters,” he concludes.
Looking to the future
Business is good, Balu says, and the company is meeting the objectives the partners set on startup. But that’s not stopping them from planning for the future.
The second part of their two-pronged strategy to overcome competitive pressures has seen Claimstech sign on as a member of the newly established Omnia Co-op. Omnia is a group of like-minded, small independent firms working together to gain access to contracts that would otherwise be out of reach for smaller companies.
Balu says their membership in the Omnia Co-op is intended to help meet bottom-line objectives. The company set a goal of $1 million annual revenue, and after four years of growth he says they are close to meeting it. “We expect to achieve the goal within the next two years.”
A must for adjusters
Claimstech’s membership in the CIAA dovetails with Balu’s view of the challenge of competing for business with the large national firms. “It should be a must for any kind of independent adjusting company,” he says. “Whether it’s a boutique firm or a medium-size or large firm, you need to be a member so that we can work together to spread the word about the professionalism of the independent adjuster.”
He underlines the value the association offers in developing talent through seminars and other events. As well, he feels the association’s elected board ensures representation across the country from firms of all sizes. “They do represent the needs of a small independent and boutique firms all across Canada.”
For Balu and Raj at Claimstech, their CIAA membership supports their carefully crafted strategy to compete in the changing claims industry, while at the same time supporting it by creating training opportunities for new adjusters.