M. Ramadoss Chairman-cum-Managing Director mramadoss@orientalinsurance.co

1. NON-PERFORMANCE: AN INSURER’S RATIONALE M. Ramadoss Chairman-cum-Managing Director mramadoss@orientalinsurance.co.in

2. IMPORTANCE • One of the prime causes for the entry of private sector in the industry is to throw the industry open to competition from several players • Competition is expected to bring in the best in the industry, bring in the best terms for the customers • Remember the Rs.28 per “incoming” call charged by Mobile phone Companies or the Rs.25000 one-way airfare to Singapore!!

4. WHAT IS CUSTOMER SERVICE? A business cannot exist unless it has customers to buy the products it wants to sell. Customer service is the term used to describe what happens at the points at which the customer comes into contact with the business.

5. CUSTOMER SERVICE CIRCLE

6. CUSTOMER EXPECTATIONS IN GENERAL INSURANCE, CUSTOMER EXPECTATIONS ARISE AT TWO STAGES • POLICY SERVICING STAGE • CLAIMS SERVICING STAGE

7. POLICY SERVICING

8. POLICY SERVICING • INFORMATION STAGE • ENLISTMENT STAGE • POLICY SUPPORT STAGE • SECONDARY SERVICES

9. INFORMATION • PROSPECTS NEED ADEQUATE INFO ON COVERS, TERMS AND RATES TO ENABLE THEM DECIDE THEM THE NEED FOR INSURANCE, THE TYPE OF COVER, THE RIGHT AMOUNT • NEED FOR BROCHURES, PAMPHLETS, KNOWLEDGEABLE INTERMEDIARIES • INSURER’S REPUTATION AND IMAGE SHOULD INSPIRE CONFIDENCE • ‘HELP DESK’ FOR PROVIDING COVER INFORMATION

10. ENLISTMENT STAGE • SEVERAL PROSPECTS REQUIRE ASSISTANCE IN DOCUMENTATION LIKE FILLING UP PROPOSAL ETC. • ENLISTMENT SUPPORT BY INTERMEDIARIES SHOULD BE DONE WITH CARE AND ONLY WITH FULL CONCURRENCE OF THE INSURED HIMSELF

11. POLICY SUPPORT STAGE • SATISFACTION OF FAIRNESS IN THE DEAL • SPEED OF DELIVERY OF DOCUMENTS • CORRECT POLICY DOCUMENT – CONSENSUS-AD-IDEM • EXPLANATION OF THE POLICY DETAILS WHERE REQUESTED BY CUSTOMER

12. SECONDARY SUPPORT STAGE INCLUDES POST POLICY SERVICES SUCH AS ENDORSEMENTS ALTERATIONS & ADDITIONS CANCELLATIONS

13. INTERMEDIARY ISSUES • AGENTS/ BROKERS OVER-SELL & INSURERS UNABLE TO MEET THE CUSTOMER EXPECTATIONS • INTERMEDIARY PROPROTIES ARE DIFFERENT FROM COMPANY’S PRIORITIES – EXAMPLE MEDICAL POLICIES FOR AGED PERSONS

14. CLAIMS SERVICING

15. CLAIMS SERVICING • THE CORE OF CLAIMS SERVICING IS • ‘HELP DESK’ FOR IMMEDIATE RESPONSE • TRANSPARENCY OF ASSESSMENT • SPEED OF SETTLEMENT OF CLAIMS • LEAST DISTURBANCE / INCONVENIENCE TO THE CUSTOMER • FAIR AMOUNT OF SETTLEMENT

16. CLAIM ASSISTANCE • CUSTOMER BE TREATED WITH CARE & UNDERSTANDING AND NOT WITH SUSPICION & DISTRUST • SURVEYOR COMPETENCY IS VITAL • ALL REQUIREMENTS TO BE LISTED IN ONE GO • SYSTEM OF ADMISSION OF LIABILITY

17. INTERMEDIARY ISSUES • SURVEYORS SHOULD SUBMIT REPORTS WITHIN TIME FRAMES • REQUEST FOR DOCUMENTS/ INFORMATION SHOULD BE IN WRITING • ASSESSMENTS SHOULD BE FAIR AND TRANSPARENT • DISPUTED ISSUES TO BE BROUGHT TO THE URGENT KNOWLEDGE OF INSURER

18. CLAIM SETTLEMENT • IF SETTLEMENT AMOUNT IS DIFFERENT FROM THE CLAIMED AMOUNT, FULL REASONS FOR DIFFERENCE TO BE GIVEN TO INSURED • IN CASE OF REPUDIATION, CLEAR REASONS FOR REJECTION TO BE GIVEN • INFO ON APPEALS & GRIEVANCE REDRESSAL

19. PERFORMANCE APPRAISAL OF INSURERS

20. HOW HAVE WE PERFORMED? • CREDIBILITY OF INSURERS – A NON-ISSUE • ALL INSURERS HAVE SOME SYSTEM OF TECHNOLOGY FOR QUICK ISSUANCE OF POLICIES, BUT DELIVERY BACKLOG STILL PERSISTS DUE TO ADMN ISSUES, POLICY STAMPS ETC • DEFINITE GAPS IN CORRECTNESS OF THE POLICY

21. PERFORMANCE IN CLAIMS SERVICING • LACK OF EMPATHY OR EVEN SYMPATHY • CUSTOMER IS NOT CLEAR ON ACTION TO BE TAKEN IN THE EVENT OF A CLAIM • DELAYS IN EVERY STAGE EVEN IN APPOINTING SURVEYOR • SURVEYOR INCOMPETENCIES – BARGAINERS AND NOT LOSS ASSESSORS • CLAIM OFFER LETTERS DO NOT DISCLOSE BREAK-UPs

22. CUSTOMER SERVICE BALANCE SHEET ORIENTAL FOR INSTANCE ISSUED ABOUT 1 CRORE POLICIES AND HANDLED 6 LAKH CLAIMS DURING 2005-06 TOTAL NUMBER OF GRIEVANCES LESS THAN 5000 WHICH IS 0.04% EVEN THIS HAS TO BE REDUCED

23. NON-PERFORMANCE • GENERALLY, ONLY MOTOR AND HEALTH GIVE RISE TO GRIEVANCES • MOST GRIEVANCES RELATE TO DELAY IN SETTLEMENT/ REJECTION • VERY FEW COMPLAINTS ON RUDE BEHAVIOUR OF EMPLOYEES • UNDERWRITING GRIEVANCES ARE VERY VERY FEW

24. NON-PERFORMANCEHEALTH • PRE-EXISTING CONDITONS • TPA IS NON-RESPONSIVE TO URGENCY • BREAK IN INSURANCE • REQUEST FOR COVER FOR OLDER PEOPLE • HIGHER PREMIUM CHARGED BASED ON AGE

25. NON-PERFORMANCEMOTOR • ACCEPTANCE OF OLD VEHICLES • RENEWAL OF COVERS WITH HIGH CLAIMS RATIOS • DL/RC VERIFICATION & INVESTIGATION • SALVAGE VALUATION IN CASH LOSS • DEPRECIATION AND DENIAL OF CERTAIN PARTS

26. FUTURE EXPECTATIONS • E-INSURANCE: POLICIES ON INTERNET/ ATM • POLICY/ CLAIMS HISTORY AND STATUS ON INTERNET • TRANSACT SIMPLE POLICY RENEWALS OVER INTERNET WITH CREDIT CARD PAYMENT OPTIONS • M-INSURANCE: TRANSACTIONS THROUGH MOBILE PHONES

27. FUTURE EXPECTATIONS • INTEGRATED HEALTH INSURANCE WITH PREMIUM DEDUCTED AT SOURCE- SOCIAL SECURITY CHIP CARD WHICH WILL ALSO ASSIST IN CASHLESS CLAIM FACILITY • HASSLE-FREE MOTOR CLAIM SETTLEMENT AND STANDBY VEHICLE DURING REPAIR PERIOD • ONLINE CLAIM INFO & COMPLAINT TO OMBUDAMAN & CONSUMER FORUM

28. SOLUTIONS? • CUSTOMER EDUCATION BEFORE SALES • REGULAR CUSTOMER EDUCATION PROGRAMMES TO FEED UPDATED INFORMATION PERIODICALLY • FULL USE OF IT IN UNDERWRITING AND CLAIMS

29. SOLUTIONS TO INTERMEDIARY PROBLEMS? • FULL CONTROL ON APPOINTMENT OF SURVEYORS • MONITORING SURVEYOR CORRESPONDENCE WITH INSURED • TPA PERFORMANCE TO BE MORE CLOSELY MONITORED • RUTHLESS PRUNING OF INTERMEDIARIES

30. SOLUTIONS? • EMPATHY TRAINING FOR EMPLOYEES • IMMEDIATE DECISION ON ADMISSION OF LIABILITY • ENCOURAGE PRACTICE OF ‘ON ACCOUNT’ PAYMENT • REGULAR REVIEW OF PENDING CLAIMS • PERIODICAL ENHANCEMENT IN FINANCIAL AUTHORITY FOR CLAIMS PAYMENT • COMPULSORY PAYMENT OF INTEREST ON DELAYED CLAIMS

31. CUSTOMER FAULTS • SOME TIMES CUSTOMERS ALSO ARE AT FAULT • NOT RESPONDING TO REPEATED REQUESTS • FRAUDULENT INTENTIONS • IRRITABILITY – why ask all these unnecessary questions? • EXAGGERATED / INFLATED CLAIMS • LACK OF UNDERSTANDING OF POLCY COVERAGE

32. INSURER’S RATIONALE THERE IS NO EXCUSE FOR NON-PERFORMANCE EXCELLENT SERVICE IS LIKE HORIZON. THE NEARER YOU GO TOWARDS IT, THE FARTHER IT GOES AWAY FROM YOU!!!! WE ARE FAR AWAY FROM 100% CUSTOMER SATISFACTION AND MILES TO GO EVEN BEFORE WE THINK OF SLEEPING

33. THANK YOU