CED, a loss adjustment services specialist, is actively engaged in a digital transformation. The digital transformation is in response to a recent development that restoration in kind can compete with the payment of damages. This means that in the case of an insurance claim for damages by a third party, insurers can restore the damage in lieu of an insurance payment.
To address these changing market conditions and customer expectations, CED, together with Magnus, created an innovative insurance business model called CED Repair to manage this process. CED has a business relationship with over 500 handymen/women where they can offer customers or other insurers the service of repairing any damage in lieu of a payment. This expedites the repair of damages through their network.
The solution of multi-device technology and smart digital claims processes, took just three months to deliver. Operations Manager André van Vuuren explains how CED Repair has transformed itself from an ambitious idea to a successful new service in the Q&A below.
Why did CED start CED Repair?
Our customers, insurers, are under pressure. Due to the rise of online comparison sites, consumers tend to select more on price and are therefore less loyal. Insurers should provide consumers more added value and account for both a decrease in costs and a higher customer satisfaction. This raises the following question: how can CED help with achieving this goal?
We always ensure efficient and proper handling of the loss of victims, but now as a contractor rather than a mediator. Moreover, we now put the customer experience in front. Our new Mendix solution helps employees take the right steps to help out the victim as much as possible.
The Mendix solution also provides victims with better information: they know where they stand in the process and can see we are ready to assist when necessary. This is good for consumers and good for the insurer.
In addition, we do not only renew the insurance, but also the repair industry. With our mobile app, we seamlessly integrate the repairman in the process.
How did you start this project?
Together with insurers, we studied the loss adjustment process. Which touchpoints are present in the customer journey of a victim? Our requirement for the lead time was to shorten it considerably, resulting in a maximum of two weeks. The ideal process for us would be to have a repair company record the damage in the morning, retrieving paint at the wholesaler immediately after, and repair the damage in the afternoon. The shorter the lead time, the lower the transfer times and the higher the customer satisfaction.
So the process is a lot easier?
Yes! The correct intake ensures the right approach, because it must be very clear to the customer what is going to happen. This already starts during the first call: Is there a burglary? If so, we bring a prevention box. Is the customer startled? Are there children involved? Then we bring a teddy bear. Together with the insurers, we made a complete program, knowing what really adds value. We have embedded this way of intake and follow-up in the new process application.
How do you use new technologies?
Besides the mentioned personal attention, the Mendix solution also supports the technical side of the process. Our employees assess which skills are needed to repair the damage during the intake. Based on these choices, the new system decides, among other things, which repairer is available and is sent to the victim. The victim is then informed with an SMS and email with photos of the repairer. All repair companies work with our mobile app, which is tightly integrated with our Mendix process application. This allows us and the insurer to watch the progress 24/7 and ensures we are aware of all developments.
And this new business model is realized in collaboration with Magnus?
Yes, we have opted for a fast speed to market: in only three months the Magnus consultants built an application in Mendix and supervised the process. This gives us a quick Return on Investment, though it requires a lot of flexibility from the parties involved. That’s why we chose to take an Agile approach.
How revolutionary is this approach actually?
Huge! We operate in a very traditional market; with Repair, CED has introduced a completely different mindset for both repairers and insurers.
How important is the new Mendix process application to CED?
It’s very important, because with the Mendix Platform, we can easily extend to other markets, such as maintenance and private repair. Although we should not be too eager, we need to keep quality high. Our added value is in the customer experience and reducing the cost of the client. Now that technology is able to transform our ideas so quickly into working processes, we sometimes need to mark time as an organization. The world is upside down when compared to ten years ago.
Are the results worth mentioning already?
We judge our success primarily with two indicators: the cost of claims and the Net Promotor Score. We can already see that claims have declined by 9 to 11 percent depending on the insurer. And the Net Promotor Score is a lot higher, increasing from 20 to more than 50.
In the meanwhile, the new model provides us with 2.5 times more revenue than before, and next year we project to double this number again. And this is something we are more than happy with!
How does the organization respond to this transformation?
It’s a transition from process thinking to customer experience. For years, the process and tight logistics were holy: customers were offered a solution in a short time, whether the solution was optimal or not. Nowadays, the call center staff has knowledge of loss adjustment themselves and they pay more attention to empathy. At the start of the process, we assess what should be done at the back. It is helpful for the victim to partake in qualitatively good conversation. That this conversation takes longer than 90 seconds, which was previously the norm, is something we sometimes have to get used to.
With CED Repair, we operate as a best practice organization and all business units follow our developments with great interest. Things that are going well in our organization are investigated and rolled out in our parent company. Our team is growing and more and more people become affected by the enthusiasm in the organization and would like to be part of it. It’s like a pebble thrown into a pond: the ripple is increasing. More and more departments are participating. We even have a smiling accountant, which, I can assure you, is an exception in the insurance industry.