Hi, Is there a difference between Claims Underwriting and Claims Management? Having done CP1 before, I am very used to quoting initial underwriting and claims underwriting. In which one is assessment in the proposal stage and the other is to verify the validity of claims/detect for frauds. I am therefore reusing this terminology (Claims underwriting) in SP1. However I rarely see this term being used in the solution, it is almost always "Claims Management", which from the description of it sounds like the same as claims underwriting. Can I know if they both mean the same thing and therefore equally scores mark in the exam? It bothers me because I would phrase my sentence differently if I am using different terminologies, and I want to make sure the examiner knows what I am trying to say. Thanks Trevor
Hi Trevor I would say that claims management is a little wider than claims underwriting. Claims underwriting is looking at a claim and deciding on its validity. But there are additional claims management actions, eg for IP business the insurer might manage its claims by offering advice (eg a nurses visit) on treatments/physio and possible return to work part-time or in a different role. Best wishes Mark
Hi Mark, Thanks for the explanation. I think to be at the safe side, it is better to mention claim management as it covers more items. Also another follow up question: is claim management action limited policyholders that are currently in the claim state? eg for IP: we can offer advice on how to recover faster, so reducing claim payment duration. How about general advice on how to stay healthy before claim inception itself? eg: offering free sports membership to not let them fall sick to begin with. Is this point parked under claims management?
Hi Trevor, As per my understanding, Offering any free services to the customers will be cost to the company and must be charged in premiums. This might be included during premium reviewability in order to enhance marketability, in light of market competition. But also as per your point, I recall for claim monitoring we can introduce some precautions in these forms to control excessive claims. This might be case where a particular company employees/occupation has been hit by economy and there are chances of more claims. Then claim management team might use these claim monitoring techniques to control claims. Not sure, in general regular business days if this can be done. Mark can help us understand better.
Hi Trevor I would think of claims management as being for people in the claims state. Free gym membership is similar to initial underwriting as a way to reduce claims before we get to the claims stage. Best wishes Mark
Hi Varsha Yes, free services won't be entirely free and generally need to be loaded into premiums. But they may partially pay for themselves if they reduce claims. Your point on claims monitoring looks to be on a different topic though. I'm not quite sure what piece of the course you are referring to. If you give me a chapter and page reference I can comment further. Best wishes Mark
Hi Mark, I was referring to Chapter 29,practice question 29.6ii. Here it is asked to discuss impact of large rise in unemployment on company's sickness experience. In soln,there is one point of stricter claims control to reduce fraudulent claims. So this part of claims monitoring I was thinking about. Thanks, Varsha
Hi Varsha So your question was whether having stricter controls on fraudulent claims could be done these days in practice. The answer is yes. Insurers will work hard to spot fraud. There was a case in the news a few weeks back where an IP claimant had been spotted on television picking up a sporting award - the claim was quickly cancelled. The most obvious way to check for fraud for IP would be a mixture of medical certification and visits from a nurse. Best wishes Mark
