Canadian Underwriter

Independent Adjusters: Finding Common Technology Ground

October 1, 2003   by Fred Plant, a partner at Plant Hope Adjusters Ltd.

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Adjusters today are challenged to be more efficient in delivering service to insurance companies. The profession needs to continually show relevance by adding value to its services. In this climate, there is no room for adjusters to increase their fees even though the cost of doing business is increasing on many fronts, as insurers are under pressure to reduce their costs.

Despite this, there is no tolerance for reduction in quality of the information provided by adjusters to insurers. In fact, the trend is to be more vigilant, representing a return to “old time adjusting”. The bottom-line is that efficiency has to be improved. In this respect, new technology has a large role to play in helping the industry find its “efficiency solution”. As a group of professionals, adjusters can better service clients while meeting their own business objectives by working together to set an industry standard for claims management and adjuster/insurer communication.

Competing systems

Consider the historical context of our business: When insurers hire independent adjusters they are, in effect, ordering information. The insurer’s main focus is on getting the information in a timely fashion and ensuring that it is credible. Adjusters are concerned with the way in which the information is delivered and presented.

In the past, reports went from adjusters to insurers written on standard letter-size paper. The process of how the information was delivered was essentially the same from one adjusting firm to the other.

With the advent of electronic technologies, the way in which information has been ordered and delivered has undergone a dramatic transformation, although the premise of the exchange has remained the same. Insurers still need information and adjusters still make a living gathering that information. But, the process by which the information is delivered to the insurer has changed considerably as a result of technological innovations.

When electronic technology began to emerge as an integral part of our business approach, independent adjusting firms set out to develop internal electronic systems for the organization of the information they gathered. Through the use of the Internet, they created proprietary ways for their insurer clients to communicate with them in order to obtain their information electronically. Insurers were excited by the potential to easily access the information obtained by their independent adjusters using new technological innovations. Many independent adjusters responded to this need and created systems that allowed insurers to log in to the adjuster’s system to obtain their information.

This made the delivery of information faster from the standpoint of adjusters, and provided real-time access for insurance companies. However, there was a downside for insurers. Insurers were being faced with learning multiple systems (depending on how many independent adjusting firms they were working with) as the common “8.5 x 11-inch paper report” had transformed into various processes that met the adjuster’s criteria for the dissemination of information.

Standard solution

In short, adjusters responded to the opportunity presented by technology to better service insurers with faster reporting. Insurers encouraged this activity because it allowed them to monitor their claims in real time.

The side effect was the evolution of many different electronic processes and protocols which insurers had to learn. In our discussions with insurers we realized that each individual in each claims department had to go through a training process to learn how all of these different adjuster systems worked.

In the current climate of cost reductions, building an industry standard for electronic claims management and remote file access would be something of real value independent adjusters could offer insurers. The question is: Can we build a system or process so insurers could in effect get back to a common process of receiving information as they did when adjusters filed reports on standard “8.5 x 11 paper”?

Our perspective is “yes”. One reason being is that, as an adjuster, our company’s own survival depends on it – as does the survival of all other small independent adjusting firms across Canada. We also thought it was important for the industry as a whole, since small independent adjusting firms are the backbone of this part of the insurance business. Technology makes the solution possible, and now, affordable. It is perceived that such a system would have the following attributes:

Operating on Microsoft programs that are common throughout the world;

“Intuitive operation” so that after a brief introduction to the system, users in adjustment and insurer offices can get where they want to be quickly and easily;

The ability to catalogue all adjuster activity from the first call to the closing report with detailed activity notes;

Electronic document storage within the file giving insurers the added benefit of reducing their own paper storage while making file information retrieval fast and simple;

Built-in security features to ensure the confidentiality of claims information. Users are limited to where they can go in the system, what they can change, and what they can see based on who they are and what is necessary as defined when they are set-up as a user; and

All information to be backed up daily to ensure that an independent adjuster, struck by disaster, would be up and functioning again in a matter of several hours rather than several weeks.

Quality focus

At the end of the day, what sets independent adjusters apart is not the information delivery system they use. It is the quality of information they provide that is of real value. But, as markets evolve based on technology advances, so will the means of information delivery, which means that this will remain a fundamental factor for adjusters in maintaining the quality of service offered.

As a result, independent adjusters have to partner with their insurance company clients to help them meet the challenges they face. Specifically, standardizing electronic claims management processes and creating remote file access has become a critical priority requiring cooperation.

As a profession, independent adjusters can bring the focus back to the quality of work instead of the quality of individual information management systems. I invite my colleagues to step forward in presenting an “active solution” to what is becoming the biggest challenge facing our profession.