Having worked in Swiss Re's claims division for nearly 20 years, Karin Lloyd tells Johanna Gornitzki what it is like to finally be working for herself
Hardly anyone working in the field of insurance claims to having nurtured a life-long dream to go into the sector. And, for Karin Lloyd, a strategic and technical claims consultant, this certainly rings true, as she admits it was a "complete accident" that she fell into it.
"In fact, the very first job that I landed [in the industry], I actually went to interview for something completely different. The agency had made a mistake and it was the wrong job. But I was pleading with the people to be interviewed for something because I had come all the way from Gloucestershire to London. So, I was interviewed for a job that I knew nothing about," she says with a smile.
That was 24 years ago and Lloyd has now become an expert in protection insurance, specialising in claims assessments – an area she knows pretty much everything about having spent her entire career dealing with claims.
After having worked for Providence Capitol (part of Old Mutual group) as an underwriter for five years in the mid-80s, she landed herself a job at Swiss Re as an underwriter and claims assessor. At that time, Swiss Re did not have a life and health claims department, so it decided to set one up and Lloyd was subsequently promoted to be in charge of it. "That's when I made the move into full-time claims and realised we had been doing everything wrong before," she declares.
Lloyd ran the department for six years before moving into a global role with Swiss Re when the reinsurer decided to set up a global core team of around 40 people from all areas of the business. The decision to put together such a group came as Swiss Re evolved into a huge organisation and, accordingly, wanted to find a focal point for best practice, producing things that all the offices could put out to their clients.
During her time in the global division, Lloyd created several different support tools delivered via the internet, including a critical illness e-learning package that is still proving to be quite popular among industry peers – although Lloyd admits it is a "bit out of date".
This year would have been Lloyd's 20th anniversary working at Swiss Re, however, instead of waiting for the celebrations to kick in, she took the plunge in August last year and set up her own consultancy. Describing it as "one-woman's band", she says the aim of the business is to find out where claims fit in with pricing and development and feed that back into brand management.
While based in the UK, she admits to be looking forward to taking on work for insurers in other countries. With her knowledge of different insurance markets around the world, this should not be too difficult. Looking at protection insurance from a global perspective, Lloyd explains that most of the English-speaking markets work in a similar way and the big difference is really between them and the Asian markets. In Asia, more investment has gone into training than in countries such as the US, Australia and the UK.
"In Australia now, as a claims assessor, you can earn above market rate because they just can't get enough experienced people. I think the UK market is a bit like that too," she says. Contrary to that, the Chinese market, in particular, has invested a lot of money in training and setting up universities, she explains, saying that: "people should be a bit careful about where their jobs may be going in the future". She adds that, in the long-term, future UK companies may be outsourcing work to China.
One thing she found particularly interesting on one of her trips overseas was a company in Hong Kong that had drastically reduced non-disclosure rates by controlling its in-house sales force's commission structure.
"What it did wasn't only a monetary thing but it would also monitor each agent for the claims that were coming in for non-disclosure. And, if the agent had a bad record, they just weren't allowed to sell certain complex products," she explains.
Declined claims is currently one of the biggest talking points in the industry, but has the number of turned-down claims increased in recent years? Lloyd does not think so, but argues that the reason declined claims has become a focal point is because protection sales are falling and people are trying to find a reason for it. Instead of focusing so much effort on rejected claims, Lloyd thinks the claims paid out should be at the centre of everyone's attention.
"There has always been a smattering of stories when people have gone to the press when their claims have been turned down and, likewise, you always have a smattering of stories when someone has been prosecuted when they said they couldn't work and then they run a marathon or something. But between those extremes you don't get very much coverage of the people who are actually helped by their policies," she says.
Overall, Lloyd thinks firms have become much more professional when dealing with claims. "There is still a lack of expertise but that is constantly improving by bringing in people like occupational therapists as well as nursing-type services." The use of tele-underwriting has also helped speed up the processes, and, if the latest figures from MorganAsh are anything to go by, it leads to much better disclosures too, she says.
Looking towards the future, Lloyd believes the industry should try to be a bit more creative.
Take the long term care (LTC) market for example, she says, "a lot of the LTC products were actually quite good products but they needed the Government to either have some form of compulsion or some kind of initiative for people to go down that route because they were quite expensive". She mentions one of the LTC ideas she was involved in. "One of the projects looked at matching up some of the general insurance side with the LTC sector. We have this strange artificial Berlin Wall between life and non-life, which from a customer's perspective doesn't make sense at all and I don't think we, as an industry, do ourselves any favours with that kind of approach," she says.
Lloyd does not agree with the suggestion that customers have to pay extra for add-on benefits, but argues that, for the protection sector, in general there are ways to deliver quality through strategic alliances. She says insurers do not necessarily have to invest a massive amount of money into an after claims service when there are lots of patient charities in the UK that could help them out. "They should think slightly outside the box. How can we deliver quality with no pricing margin to play with and who may have a vested interest to look after these people as well as us?"
The industry is progressing, however. One new development, for example, that should be applauded is the creation of a women's insurance network. Lloyd explains that the network, which will have its first meeting in September this year, aims to get women in the sector together in a comfortable environment. "It doesn't exclude men but to actually be a member you have to be a woman," she says.
With her work for the women's network, and the establishment of her own business, including working with a new life company (which she cannot name but everyone knows), it looks set to be an exciting year ahead for Lloyd.
She has no regrets about ending up working in the protection industry and is very optimistic about the future. "It was all a complete accident that I ended up here but the industry has been good to me and I have had some fantastic opportunities. And now I have this whole new challenge," she says, clearly relishing the future.
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