By CYRIL TUOHY, managing editor of Risk & Insurance®
In April 2008, Dorien Smithson, Willis North America's executive vice president and head of the broker's strategic outcomes practice, was hired to revamp the firm's
approach to delivering risk services that is claim, risk control and data analytics. Smithson, with 30 years on the carrier side of the business, was ready for the challenge. Now, three years later, the insurance claims practice has been turned into a strategic asset for the firm.
Smithson spoke with Risk & Insurance®
Managing Editor Cyril Tuohy about turning Willis North America's claim, risk control and data analytics operations around.
Q: When did you come to Willis and what were your marching orders?
A: I started at Willis back in April 2008, and I was charged by then-CEO Don Bailey to get our arms around our claim and risk control services. So, the first thing I did was get on a plane with a pen and a pad. I talked to everyone I could. I talked to producers, business leaders, client advocates, claim and loss control consultants, prospects, clients and the markets. I asked them "why am I here? What would you perceive to be the value?
Q: And what did you find?
A: I came back with pages of notes of what everybody told me was their perception of value. Here's what I found: Business heads wanted a strategic partner, they wanted someone to help them plan how they deliver risk services to clients two or three stages ahead. Producers said they wanted someone to help them grow the business and to articulate value to clients. Claim and loss consultants said they wanted more recognition for the work they did. Clients and prospects wanted someone who could tell them what they didn't already know. The markets wanted someone who could negotiate with them from a very technical perspective. No doubt, it was a vast constituency but this was how we built our strategy
Q: What are clients telling you they want from the Willis claim operation?
A: Clients are saying they want someone in their corner to advocate on their behalf to the fullest extent possible. They want someone knowledgeable about their industry. Clients are raising the bar on their expectations. They are asking "tell me something I don't already know, provide me with something that I can't do for myself, tell me what's on the immediate horizon and what I can expect in the long-term future."
Q: Willis North America already had 300 to 400 claim and risk control people in regional offices around the country. What did you do with them all?
A: The first thing we did was to approach the issues in a very different way. We decided to create a true practice, not a "virtual practice." We did not want this to be a practice whose mission was to simply coordinate other experts within the firm. The strategic outcomes practice needed to be empowered to deliver the expertise the clients need anywhere, at any time regardless of the traditional restraints of regional borders. We pulled all those 300 to 400 claim and risk control people out of their respective business units and offices around the country and put them under the strategic outcomes practice. Once we did that, we then put together a technical leadership team and built a strategy around it. The strategy was simple. It was to help clients in three areas: prevent and mitigate loss; if there is a loss, get the claim paid quickly and appropriately; and if there was a retained loss the mission is to help the client control the cost of that loss.
Q: You also made changes to the leadership team. What were they?
A: We built a leadership team consisting of Joe Picone, the chief claim officer, Bill Spiers, the chief risk control officer, and Jason Franks, the chief data analytics officer. They operate as an integrated pre- and post-loss team reporting to me. We then took the same concept that we applied with the national team to the regional and branch level and so have practice leaders for each region/branch within North America. They are responsible for driving the integration of pre- and post-loss strategy at and driving claim resolution at their respective levels. Additionally we named national leaders of specific lines of business and industry specialties to drive that specific expertise, build best practices and train and develop others.
Q: Why was there a need to restructure the leadership team into a national, regional and branch-level model?
A: We found in any given office you could have the receptionist by day that was often the claim person by night. So, for the sake of efficiency and to improve quality, we decided to centralize the basic claim reporting and monitoring "bird dogging" in Nashville and in Phoenix. Additionally we have the field claim consultants. In the past if the client had a claim the broker would go to their local claim expert and hope that person could meet the needs of the client in question either by industry, line of business or complexity. If not, the next best thing was to blast an e-mail asking if anyone knew anything about a specific claim, or if anyone knew anyone else with the requisite expertise. Then, if they found it, they go through the process of negotiating or bartering to have access to that person. We do it differently because all claim professionals report to one arm, the claim management arm. We are able to bring the appropriate claim professional at any level, from anywhere to get the best results for our clients
Q: What technology systems are you using to help you collect your claim data, and how are you making the processing of data more efficient?
A: We track metrics carefully. So, for example, we track how quickly we report the claim to the carrier, our maximum target is that it's reported within 24 hours, for example. Then there are the expectations on how quickly carriers get on the case, how quickly the carrier assigns an adjuster to the claim. Then, when we put forth a valid claim, we expect and track partial payment. We track a number of metrics and have a target for claim processing based on our experience on what we expect is fair. Here is our philosophy: The faster we get the claim reported, the faster we get an adjuster assigned, the faster we get our clients paid, the faster the client can get back to business
Q: Do claims matter from the perspective of clients?
A: Claim factors heavily in any decision by the client. Getting a claim paid is a fundamental reason why you are buying insurance. If you ignore that it would be madness. It's very important to clients. Clients want to do business with people they believe will treat them fairly. They want a broker partner so that if something goes south, they are not home alone.
Q: You spent much of your life on the carrier side. What
has it taught you that you were able to bring to the broker side?
A: As an underwriter you represent yourself and you do your best to convince the insured that you're giving them the best that is available. When you come to the broker side you have a broader view of things. Inherent in the broker role that I occupy now particularly on the claim resolution side is it's a role that demands handling controversy. The client needs us when things go south. You stand between the insured and the carrier. I have much respect for our carriers and feel a responsibility to negotiate with them from a highly technical and professional platform.
Q: Where do you see yourself and the reforms you've instituted at Willis in the next three to five years?
A: I'd like to see us have greater involvement with long-term strategy. What I'm talking about are things outside of the immediate claim and the risk control transactional process. In the next three to five years we are also looking at making investments in deeper industry specialization, building out our specific industry expertise in specific geographic areas, training for the next generation. Carriers used to grow their own and that had gone away to a large extent. We are starting to see it come back as the carriers recognize they have a vested interest in training people who can manage and process a claim. It's about growing your own and making an investment in developing people.
March 1, 2011
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