How to have tough claims conversations

When the devasting earthquakes struck New Zealand’s Canterbury region in 2011, insurance professional Tony Boon was seconded from a national training role to manage the ensuing claims. A Christchurch local, he had a deep understanding of how his clients were feeling.

‘It was definitely the highlight of my career,’ says Boon, now Head of Claims Operations at Ando Insurance.

‘The fact that we were able to help so many people move on with their lives was unprecedented, but there were some tough conversations that we had to have with clients along the way.’

The bearer of bad news

Boon recalls a difficult conversation with an older couple in the aftermath of the disaster. The husband had cancelled their insurance policy prior to the earthquake without telling his wife.

‘We felt terrible for them,’ says Boon. ‘It was a really hard conversation to have. But while we couldn’t help them by providing them with cover, we were able to put them in touch with our network of experts and services.

‘I always tell my team that when you know you have to deliver tough news, be upfront about what's covered and what’s not and have that conversation as early as possible, but always try and find the things that you can do for people, because there’s always something you can do to help someone out.’

Straight to the point

No one wants to be the bearer of bad news, but it’s part of the job in most industries, especially for insurers and brokers.

Clients may be in a vulnerable state during a claims process and emotions can naturally run high. Insurers are under pressure to be mindful of vulnerable clients and sensitive to the impact of catastrophes, while also running a sustainable claims process.

All in the delivery

Rebecca Houghton is CEO of BoldHR and runs training workshops on how to have difficult conversations. She says that while you may not be able to tell clients what they want to hear, the way you deliver the news can help to shape their claims experience.

Houghton adds that while tough conversations are rarely easy, it’s important to get straight to the point.

‘Most people try to avoid tough conversations and tend to fluff about a bit with how they deliver bad news,’ says Houghton.

‘However, there’s a danger in that, because it can be quite confusing for the receiver of the news and they're not clear on exactly what you're saying.’

‘People can become distrustful of you when you're not being really clear with them,’ adds Houghton.

‘It’s better to say it like it is and give them time to digest it, rather than try to manage their emotions through using more words as a delay tactic. In trying to make yourself feel better in delivering the news in an abstract way, you’re actually making the receiver feel worse.’

Don't delay

Boon adds that tough conversations should not be delayed.

‘I've never heard of a situation where waiting to say no to a claim has worked out better for anyone,’ he says.

‘The longer you wait to deliver the news, the higher the expectations of cover and the harder is to have that conversation. It’s better for everyone to have the conversation sooner rather than later.’

Nicki Mackay, Head of Claims and Digital Assessing at FMG in New Zealand, says her team members face tough conversations with clients when claims outcomes aren’t what they expect.

‘As soon as you sugar coat something, you actually create an environment where there's an element of doubt in the decision, or there's a feeling that something's not quite right. That’s not fair on your clients,’ she says.

Ensure clarity

Mackay says it’s not so much the news that’s delivered, but how it’s said that can influence a customer’s claims experience.

‘It's really important to think about how we deliver those messages,’ says Mackay. ‘Are we using clear language that our clients, who are not experts in insurance, will understand and take on board?

‘Insurance is complex, let's face it. Our job is to make sure that our clients understand what is or isn’t covered and why. This information needs to be delivered in a way that is clear and that people can feel comfortable with.’

Mackay says that insurers must ensure their claims teams are equipped to have tough conversations.

‘Our team are trained to pick up on vulnerability and to identify clients that might require extra care. How do we train our teams to have those difficult conversations? These all things that we do on a regular basis.’

Empathy and understanding

Tough conversations can go more smoothly if you plan what you want to say.

‘It’s easy to imagine how someone is going to take the news, but you can’t control their reaction,’ says Houghton.

‘Before you have the conversation, take time to plan what you’re actually going to say, and remember that their reaction is not about you personally, so long as you deliver the information in a way that is clear and to the point and that you show a degree of empathy.’

Mackay says empathy is a vital ingredient when it comes to having tough claims conversations with clients.

‘We need to be able to put ourselves in our client's shoes,’ she says. We need to set expectations with them throughout their claim and provide honest information in an empathetic and respectful way.

'Sometimes, this may involve pointing them in the direction for help if they want to lodge a complaint, and it’s important to make them aware of services such as the insurance ombudsman if they feel like what we've done is unfair.’

Listening is also a valuable skill during tough conversations, says Mackay.

The importance of listening

‘It’s also really important that our teams listen hard to what our clients are saying, because they may not understand why a claim has been declined and we need to be able to explain it,’ she says.

‘Or, sometimes clients just want to be listened to. It's not so much that they want to change the outcome, but just need to be able to talk through everything they need to.’

For Boon, tough conversations require the human touch.

‘You need to listen and to be human,’ he says. ‘I think sometimes we over-complicate things or we're just focused on the thoughts of the regulators, but I think being a decent person is the best solution.

‘This approach works for business just as it works in life,’ adds Boon.

‘We all have to have tough conversations as some point, so talk to people like they’re human beings and focus on what we can do for them, not just on what you can't.’