The nation's third largest automobile insurer is pioneering a one-stop vehicle repair service that's earning accolades. The Progressive group of insurance companies is applying home-grown and purchased information technology to manage the entire claims process for customers in 17 selected U.S. markets.There's little in life that compares to the emotional experience of having an automobile accident that's followed immediately by the car repair merry-go-round.
To most consumers, the vehicle repair process can be a confusing and time-consuming process. Generally, you must contact your insurance company, get repair quotes from several body shops, arrange for a rental car, get your car to the body shop, check on the progress of the repairs, wait for the car to be fixed, then inspect the work and drop off the rental. And that's if everything goes well.
"It used to be that when we'd write a check for a claim, our work would end and the customer's work would begin," says Brian Passell, claims group president for the Progressive group of insurance companies, the nation's third largest auto insurance group. "Then we asked ourselves, 'why?' and changed it all. What used to be the customer's problems are now our problems, and that's the way it should be," he asserts.
Progressive is believed to be the first insurance company in the country to take responsibility for the entire vehicle repair claim's process and provide customers with a way of avoiding the roller-coaster experience.
Progressive launched the innovative auto claims system a year ago (April 8, 2003) and today the carrier has one-stop claims service centers serving 17 markets around the country. The program offers the carrier's customers a choice-manage the repair process themselves or have a Progressive claim representatives and hand-selected auto body repair shops manage it on their behalf.
"For customers who don't want to do it themselves, we basically can manage the whole repair process for them," says Craig Moore, manager, one-stop claims service centers for Mayfield Village, Ohio-based Progressive.
Rather than do-it-yourself claims processing and repair, "when you call up to report a claim, we'll tell you about this option," says Moore. "If you select it, when you come into our service center, we'll have a rental car for you. We'll spend 10 to 15 minutes checking you in and you drive off in your rental. After that we manage the repair process for you," he adds.
When the car is ready, the owner returns in the rental car. "We've inspected the car to make sure the repairs are OK and if you have a deductible, we collect it from you and we take care of paying the repair shop," says Moore. Customers may choose their own repair shop.
What prompted Progressive to quietly initiate a "one-stop" pilot program in 1999 that could dramatically change its auto repair claims procedures?
"We looked at the customer and said 'there must be a better way,'" to make the process faster and easier for the customer explains Moore.
"From our perspective, the shop's perspective and the customer's perspective, we're trying to form a better relationship. We want to work with the shops, focus on quality repairs, and get it all done quickly," explains Moore.
This strategic innovation is made possible by Progressive's own home-grown information technology, augmented by software purchased from an outside vendor that allows the company to estimate the repair costs associated with damaged vehicles.
All together there are three basic technology systems at work. One component keeps track of all claims files and was initially developed by the carrier in 1987 for use company-wide. So when a customer calls in with a claim, it's the information technology that allows Progressive to "see" what coverage he or she has, the policy data and claims history and any special notations that are pertinent to the policy.
The second piece is a Web-based scheduling and workload management system called WebTracker, developed by Progressive about two years ago. It helps the insurer schedule customer appointments and acts as an interface between the one-stop claims centers and the associated repair shops. The system helps carrier representatives schedule repairs, track their progress from start to finish, and coordinate any changes or updates in the repair of a vehicle. WebTracker time and date stamps all car repair information.
The third piece of applied information technology helps the claims centers estimate the cost to repair the damaged vehicles. (It was purchased from a leading software vendor in the estimating field that Progressive declines to name).
Repair updates are communicated to the customer through the use of a text pager. The text-paging feature is linked to the IT system. "When a customer first comes in, we loan them a text pager," says Moore. "I can use the pager to send a customer a text message that says we have estimated the cost of the damage to their car and here are the estimates. I can also tell them when their car will be ready and what day I will call them to let them know when they can come in and pick it up," he adds.
The WebTracker system allows Progressive claims centers to know in real time when customers will come in to drop-off rentals and pick-up their vehicles. "The system helps us to manage the workload so we can have the right number of staff on hand to handle customers," says Moore. "It helps make sure that we don't schedule too many customers at one time," he adds.
A whole host of events are tracked by the IT system. "If you have a car in for repairs at one of our claims center, I can go into the system and tell you exactly where the vehicle is in the repair process," says Moore. The selected repair shops taking part in the program are linked into the IT system so they can provide updates to the insurer.
As part of the innovative claims IT system, Progressive places bar code labels on each incoming vehicle that can be read with a hand-held scanner. The information in the scanner can be cross checked with information in the WebTracker system to verify the lot location of cars either headed to the repair shop, not assigned to a repair shop yet or that are ready for customer pick-up.
"I can scan every vehicle in our lot to make sure it matches the data in the IT system. It's an enhancement to the system that allows managers to double-check the system and see if it matches with the vehicles sitting in our claims lots."
It's too soon for the Progressive group of insurance companies to disclose time or cost saving facts or if the one-stop claim's service centers are luring new auto insurance customers into the fold.
"It's too early in our development to talk about any specific numbers," says Moore. "But clearly, one of the reasons we did this is because we think it's more efficient. It's our goal and our expectation that this one-stop claims system will save everybody money that can then be turned back to the customer," adds Moore.
Information technology certainly makes the process more efficient than traditional insurance company approaches. "The technology allows us to pull this off," maintains Moore. "It would be very difficult to operate this kind of service for a customer without the IT systems we have in place. The technology saves us and the customer-who wants their automobile fixed as quickly as possible-a ton of time," adds Moore.
Moreover, the text-paging feature of the system is much more efficient than the telephone. "You can't always connect with the customer by telephone. When we use text-paging, I know our customers receive the current repair information," says Moore. "And we don't have to worry about playing message tag."
"Customers who have gone through the process, just love it," exclaims Moore. It's a lot easier for them. We do the work. We get them back into their vehicle fast and the repairs are top quality.
Anecdotally, Progressive has received accolades from many of the people who have been through the process. One claims service center representative was even hugged by a customer. "We don't expect hugs every time," says claims group president Passell. "But the process is getting rave reviews, and we believe this is the future of auto insurance," he adds.
While claim's processing is core to all insurance carriers, it is a standout for Progressive. The insurer has used its skill in the function to become one of the most profitable firms in the industry and win recognition from Fast Company and Investor's Business Daily for its innovative techniques.
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