This article originally appeared at InsNerds.com. This article was going to be named “Help, I Hate My Claims Job” but as usual Carly served as the voice of reason…
I started in claims, and I loved it. My first insurance job was taking calls in a claims call center. Then, I got recruited by a bigger carrier who took me out of the call center, gave me a raise and a job title with “Senior” in it, and then, unfortunately took away my decision-making abilities. I hated it! One thing I did enjoy about my second claims job, was the opportunity to spend 10 days in Joplin, Missouri volunteering for CAT duty after the deadliest tornado to ever hit the US. The experience moved me and made me realize how claims can positively affect lives.
Some of my best friends still work in claims, and they love it. We normally focus on articles about how insurance is an awesome career, but we try not to shy away from constructive articles to help make it an even better place. That’s exactly the purpose of this particular article.
Claims is a great place to start an insurance career, and claims is an awful place to start too! Have I confused you yet? Good.
Because of my extremely extroverted nature, my involvement with the CPCU Society, and this blog, I have the unique chance of interacting with a LOT of insurance professionals. I’m connected to 4,400 of them on LinkedIn (and growing) and have met hundreds of them in person whenever I have a chance to. Many of these folks are just a few years into their careers. Claims has always been an entry point into our industry, and at most carriers, it’s easier for a brand new college grad to score an entry level job in claims than it is to get one in underwriting or other departments. Starting in claims is great because ultimately claims handling is the product we sell. Insurance is inherently intangible, and the claims experience can “make or break” whether or not the customer ultimately chooses to keep using their current carrier.
The customer no longer cares about the great price they paid, the smiling agent, or the spiffy website or app they bought the insurance from. Once a claim happens, handling that claim well is all that the customer will remember, and it will have a huge impact on whether the customer remains a customer. Thus, claims professionals truly have the future of the company in their hands, and having a year or two of claims experience will help you better understand insurance, even after you grow into other areas of the industry. A fantastic claims experience is probably our best vaccine for a customer to stay with us even after being bombarded daily by billions in marketing.
Most insurance rookies I chat with start out by being polite when I ask them how they like working in insurance, but when I dig a little further, and they start feeling a little more confident, the ones that are in claims generally admit to wanting to get out of the industry. Then, I ask them why they would ever leave insurance, tell them my story, and try to convince them that insurance is awesome. I’ve come to the conclusion that quite simply, claims IS a great area of insurance to work in, BUT it’s not for everyone.
The problem is that the typical entry level claims job has changed, typically for the worse. If you started your career in claims back in 1990, chances are you were a multi-line adjuster. You may have even been lucky enough to work from home in the field. That was a great job! You got to help customers out in person, had a lot of control over your time, dealt with a large variety of work each day, and continued to learn for several years. You had a real opportunity to pay your dues and to learn your trade. Some carriers taught their field staff to handle personal and commercial claims including property, casualty, and other lines. Society was also a lot less litigious back then.
Today, most carriers have moved to an in-office, call center environment where claims reps, many brand new to the industry, deal with large numbers of claims. Some carriers have even specialized the function so much that their reps see only one line of the claim or even just one coverage. From the carrier perspective, it keeps salary costs down because of reduced training expense and lower overhead costs. This works well for quarterly earnings calls but, unfortunately, doesn’t address longer-term problems with training and retention. It also doesn’t help us grow broad claims managers! Younger Millennial workers demand constant engagement, the feeling of purpose at work, and job satisfaction, and these types of customer service jobs rarely satisfy those needs.
The reason I loved my first claims position was because I got to see a variety of claims of all types as I took the first notice of loss call, then I got to work the simpler ones (clear liability, no injury, not a total loss, less than $10k in damages). The reason I hated my second claims job was pretty much the exact opposite. I was a specialized casualty adjuster working nothing but first party injuries. I didn’t get to make any liability assessments or decisions, work the property damages to the car(s), manage the rental car or work on the third party injury. I literally reviewed medical bills and paid them out with very little negotiating authority. It was a glorified data entry job and might have turned me off from insurance forever had it been my first job! I know other people whose specialized claims positions were simply making liability decisions and never paying an actual claim since every coverage was handled by other teams. That’s not how you create a fulfilling job and grow an engaged insurance professional for the long term!
Unfortunately, many carriers have irreversibly changed to a specialized, large office setting, and this cannot be easily turned around or changed. Some successful carriers now implement career path coaching for ambitious employees. These initiatives involve either creating growth opportunities within the employee’s current position or a defined roadmap for future opportunity. Many of these entry-level employees experience “burnout” within a year or less so it is imperative for carriers and entry-level managers to regularly discuss advancement and education with the employee to keep them growing and moving forward. Designations are a good way to work on personal development, but, ultimately, it is up to the employee and employer to work together to maximize the employee’s career development.
If you are doing an entry-level claims job, know there are abundant opportunities available with some good personal development and the right mentor. Commercial and personal lines claims jobs are increasing every year as more and more Baby Boomer employees leave the workforce. Litigation specialists are usually trained from within and handle large, complicated, litigated files. Complex property specialists handle large commercial risks including catastrophes and multi-million dollar properties. Specialized lines like management liability and bonds claims offer great opportunity for people willing to explore new career opportunities. There’s also the option of becoming a field adjuster or even a Catastrophe adjuster who basically lives in the field and are like the Marines of the insurance industry. The first one to arrive when something happens.
Many of these opportunities are offered to the best and the brightest employees so make sure to check with your manager regarding career development to make sure the company is working to help you develop as much as possible. Many companies offer job shadow and career development opportunities. If you have done everything you can regarding designations and personal development, it may be time to see what other departments or even other carriers offer. Of course getting your AIC and CPCU will really help!
Claims is an interesting, rewarding, and fun career with many opportunities opening up in the coming years, but it’s not for everyone. Make sure you check out everything this function of the industry has to offer before moving on to other ventures and if it’s just not for you, that’s fine, use the valuable claims experience you got to move on to other areas of the industry!
If you are a claims manager, director or VP, we call on you to take some time to look at your turnover. Are your younger employees leaving to go do claims at other companies or growing into other non-claims areas of the company? Or are they leaving the industry entirely? If too many of them are leaving the industry serious changes are needed.
We would love to see companies personality testing new employees, not only to figure out whether they’ll be a fit for their first job in the company, but also to help them find great long-term placements after their first couple of years. Then, during orientation and beyond, make it clear that while claims handling IS the product people are buying, and it is an excellent way to start your insurance career, but it’s not for everyone. Ask from the beginning that they give you 18-24 months to get a good feel for claims. During that time, invest some resources in teaching them about the different paths to grow within claims AND also in teaching them about different paths in the rest of the industry. Make it explicit what they should be doing to grow into the paths they’re interested in pursuing. Publicly celebrate those that grow within the claims function, and also celebrate those that did a good job and then grew into a different part of the company. We are all much better off if we can help an employee grow to an area of the industry that’s a better match for them than letting that experience walk out the door to pursue a career in a different industry.
Since I only spent 2 years in claims, I brought in a more experienced claims consultant to help me improve this article and add detail to the claims opportunities past the entry level. I’m very thankful for his help. For now he has requested to remain anonymous.