Flood Claims – Improving the Customer Experience for NFIP Policyholders
There I was, sitting on my patio watching the PBS Frontline report on the problems with the NFIP with regards to Superstorm Sandy policyholders. Just a few days prior, I returned from the 2016 National Flood Conference (NFC) where I experienced three days of listening to elected and appointed politicians. FEMA/NFIP/DHS officials and a handful of self-proclaimed experts, all spoke with great enthusiasm and conviction about the NFIP and their ideas for “improving the (NFIP) customer experience”. It didn’t take me long to realize there is a troubling disconnect in the flood program. There is a mile-wide gap between what we in the flood industry all think how the NFIP should be treating its policyholders and how the NFIP actually treats actual flood loss “sufferers” – which I define as flood loss survivors with NFIP policies.
The new Director of the NFIP, Mr. Roy Wright, gave a great speech during the opening session of the National Flood Conference (I am a fan!). Many of the ideas he touched upon for change at the NFIP at the NFC as well as during the interview on PBS will improve the NFIP customer experience. Some of them will certainly take “an Act of Congress” to come to fruition but in the end, we will all benefit from them.
It was made clear at this year’s flood conference that over 99% of all Superstorm Sandy NFIP flood claims were settled and closed without incident. This percentage reinforces what I have experienced in all my 37 years of flood adjusting for the NFIP and WYO insurance carriers. So, in effect, the Frontline piece, as well as all the talking heads at the NFC, are concerned about less than 1% of claims that, for numerous reasons, fall through the cracks and leave flood sufferers with a less than satisfactory “customer experience” when dealing with NFIP policies.
Now I am all for making NFIP claims handling better for everyone. And, as adjusters, we can’t sit back on our laurels because the numbers reflect a 99% or greater closing rate among Sandy Storm policyholders. A 99% closing rate doesn’t mean that all 99% of Sandy NFIP flood sufferers were “happy” with their settlements. Let’s not forget the SFIP, with its three distinct policy forms (Dwelling, General Property, and RCBAP), is an insurance policy with limitations, exclusions, and restrictions. As much as I, and every other adjuster, claims manager and Independent Adjusting firm owner I know would like to see every policyholder made 100% whole, the SFIP dictates just how far we can go, legally, to make that reality (remember, the SFIP is actually a Federal Law).
What can adjusters do to improve the NFIP customer experience? I do have an idea. As adjusters, let’s improve communication. As adjusters, we have to a better job in communicating to the policyholder not just how their claim will be handled but, also how the flood program works. If there is time, this should be done on the first “phone” contact with the policyholder. If that is not possible over the phone, it must be done “in person” during the initial inspection. The adjuster should not leave the property location without explaining how the NFIP works as well as answer all policyholder questions they have at that time. The adjuster should set reasonable timeline expectation for the policyholder as well as set boundaries as to when the adjuster will be available to return phone calls, emails, and texts.
We are living in a very social media driven society, and a good adjuster should encourage his or her policyholder to contact him or her in as many ways they are able. Return all phone calls, emails, and texts within 24 hours. During a big event, everyone is going 24/7/365. Emails and texts can be written at any time and phone calls returned during reasonable hours. Policyholders WANT to hear from you, even if you have no news to communicate and are only calling back to acknowledge the communication!
If the adjuster has only bad news to communicate it’s better to do it sooner than to procrastinate because the news makes YOU uncomfortable. If the SFIP does not allow for coverage in a specific area of concern for a policyholder, it should be communicated to that policyholder as soon as possible. It that way, the policyholder has more time to find alternatives to resolve the issue.
Remember, policyholders lives’ don’t stop because their home got flooded. Life goes on, but the house also has to be fixed! At initial inspection, half of what you tell the insured, not matter how good your interpersonal communication skills may be, will be lost in the chaos of the moment. Don’t get short, upset or (my favorite) sarcastic with any policyholder who asks the same question multiple times. Their lives have just been turned upside down, and it is our job, as adjusters, to get them back to normal as much as we can.
I have a few other ideas stirring around in my head about improving the NFIP customer experience, but that is enough out of me for now.
After the Frontline show had ended, I turned on HLN and began to watch Forensic Files, one of my favorite shows. The episode was about a woman who killed her husband because he was not caring enough. Instead of just leaving him, she blew his brains out and, amateurishly attempted to make it look like an accident. I began to think that there is a political force in government who believes the NFIP and its adjusters don’t care enough about the policyholder and want to see us out of work and the NFIP “dead”. In my opinion, just like with the wife, these folks just need to “leave” – as for the rest of us, yours truly included, we will stay and do our best to continue to make the NFIP the best government-private sector partnership in the Federal system.
Adjust ‘til ya bust!