Insights from Liberty’s Claims Management Division
The onset of the COVID-19 pandemic caught the world off guard, leaving various industries grappling with unprecedented challenges. The insurance sector, specifically its claims process, felt the profound effects of this global crisis.
I had the opportunity to speak with Boitumelo Mothoagae, Divisional Executive of Claims Management at Liberty, to gain insights into the industry’s experience during this turbulent period.
From the outset, it was clear that COVID-19 had a considerable impact on the insurance claims process, particularly in terms of the death claims component. Boitumelo highlighted that the death claims segment saw a significant surge, especially during the third wave, known as the delta wave. Liberty witnessed an astonishing 60% increase in the number of death claims, with an unexpected rise in large claims as well. The severity of the claims also escalated, with stage three and stage four cancer claims becoming more prevalent post COVID.
While death claims experienced a temporary impact, they gradually rebounded as the waves of the pandemic subsided and the national death rate decreased. Notably, a new trend emerged in the living claims: long COVID claims and an uptick in critical illness and dread disease claims. Boitumelo mentioned that these claims often presented at more advanced stages than before, raising speculations about whether pandemic-related factors, such as postponed checkups and delayed medical care because of lockdowns, contributed to the trend.
Digital innovations – COVID-19 necessitated a swift shift towards digitisation within the insurance industry. Traditional paper-based claim submissions were rendered impractical due to hygiene concerns and movement restrictions. As a result, companies had to adapt and implement digital claim submission processes, making it both hygienic and convenient for clients to submit claims from their homes. This transition highlighted the importance of innovation and customer-centric strategies in navigating crises.
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Liberty’s claims team, like many others, faced challenges related to staff capacity due to COVID-19 infections and, tragically, even fatalities among colleagues. This compelled the company to explore solutions like hiring more and cross-skilling current assessors and embracing automation. By automating processes, Liberty aimed to enhance efficiency, reduce processing times, and manage the surges in claims volume, while maintaining the utmost sensitivity to the emotional needs of claimants.
Boitumelo emphasised that, while the pandemic-induced changes were significant, they aligned with predictions made by actuaries. The operational impacts, however, were palpable to the claims management team, who observed these shifts firsthand.
Transparency – A critical lesson drawn from the pandemic was the importance of education and transparency in the claims process. Clear communication with clients and advisors became paramount, particularly when dealing with increased claim volumes and complex processes. Liberty recognized the need to collaborate with clients to expedite claims processing efficiently.
Another notable lesson derived from the pandemic was the significance of full disclosure during policy inception. Clients who wisely supplemented their policies with additional coverage were often submitting early claims, leading to validation processes that exposed discrepancies between initial policy information and later medical records. This issue was exacerbated by the pandemic’s impact on medical practitioners’ availability and record-keeping.
Financial advisors also played a crucial role in ensuring smooth claims processing. Boitumelo emphasized three key points for advisors to consider: ensuring complete claim requirements, managing client expectations through clear understanding of policy terms, and maintaining accurate and updated client information. By adhering to these principles, advisors can prevent unnecessary delays and ensure the claims process is as seamless as possible.
The COVID-19 pandemic brought about significant changes to the insurance claims process, impacting both the technical and emotional aspects of claims management. The increase in death claims and the evolution of claim trends highlighted the pandemic’s multifaceted repercussions. Additionally, the necessity of digitization accelerated innovation and forced the industry to prioritize efficiency and customer convenience.
My discussion with Boitumelo Mothoagae shed light on the resilience and adaptability of the insurance sector during challenging times, underlining the importance of continuous evolution to meet the needs of clients and claimants alike.