John Yoswick

John YoswickJohn Yoswick is a freelance automotive writer based in Portland, Oregon, who has been writing about the collision industry since 1988. He is the editor of the weekly CRASH Network (for a free 4-week trial subscription, visit www.CrashNetwork.com).

He can be contacted at john@crashnetwork.com 

Tuesday, 15 November 2016 20:16

Retro News: November 1996, 2001, 2006, 2011

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15 years ago in the collision repair industry (November 2001)

Insurers risk losing market share because their field claims staff focuses too much on reducing costs and not enough on customer retention, according to industry consultant Dale Delmege.

In a presentation at the Collision Industry Conference (CIC) in Anchorage, Alaska, Delmege said such claims staff often are “driven powerfully and instinctively by self-preservation, are isolated and entrenched, are insulated from such issues as policyholder defection, are impervious to their own employer’s goals, are institutionally incapable of acknowledging reality, and share none of the common interests” of shops, vehicle-owners and insurer upper management.

Delmege, a past chairman of CIC, emphasized that the views he was sharing were only his own based on some research he conducted for a client interested in what factors would likely result in U.S. insurers gaining or losing market share.

He said you generally have to look six or more management levels above field staff in an insurance company before you find someone with accountability for both expenses (severity and loss adjusting expense) and marketing or customer retention. Staff below that level care primarily for one or the other but not both.

He suggested that because consumers often base their decision on whether or not to switch insurers on the “claims experience,” an insurer could retain and gain market share by transferring accountability for both cost-containment and customer retention closer to those controlling that experience.

“By that I mean a regional executive who sweats both bullets, who makes decisions about the administration of claims as a function of his other responsibility, which is retention of policyholders,” Delmege said.

Delmege and others at the meeting pointed out that insurers could also reduce field staff by shifting more of the responsibility for – and benefit from – both cost-containment and customer retention to shops.

“Never before have insurers had so many opportunities to have claims repaired honestly, to have policyholders treated superbly, to have repairers make a massive contribution to loss adjusting expense,” Delmege said.

– As reported in Hammer & Dolly.