El Niño is a warming of the Pacific Ocean that occurs every 3 to 7 years and impacts weather on a global scale. As the warming waters move from west to east along the equator, they bring moisture and rain to the Southern tier of the United States and the west coast of South America. Drier weather and warmer weather can appear in other areas (Australia and Indonesia are often afflicted with drought and related issues like wild fires).
A significant El Niño developed in 2009 and is predicted to last well into Spring of 2010.
El Niño’s impacts on weather include higher-than-average rain in California and the Southwest where the storm season can generate peak claims volume. The 1997-98 El Niño (the most significant El Niño measured to date) produced 230% of normal rainfall in San Francisco and 210% of normal rainfall in Los Angeles. This year’s El Niño is producing rainfall well in excess of normal, particularly in Southern California.
The Unhappy Insured – The Dreaded Side Effect of El Niño
Insureds seem to have virtually no tolerance for delay and are not soothed by explanations about massive claims volume. Most do not accept excuses and want fast service regardless of the broader situation. Endless hold messages (“Your call is important to us…”) or busy signals when faced with a personal loss result In frustration and upset.
As noted in the J.D. Power 2009 Home Claims Satisfaction Study, “A positive claims experience that meets or exceeds expectations may foster long-term loyalty, while a negative experience may drive the customer to shop for a new insurer.” The link to the full study is 2009 Home Claims Satisfaction Study.
As a result, El Niño can not only Increase loss expenses, It can also negatively impact premium if the claims experience for the policyholders is not a pleasant one.
Taming El Niño and Soothing the Storm-Ravaged Insured
The elements that tame El Niño and sooth the storm-ravaged insured are:
- Speed of contact
- Speed of inspection
- Speed of report, which permits
- Speed of settlement
The rapidity with which a claim is addressed goes a long way toward bringing about a claims experience that “meets or exceeds expectations.” In the absence of speed, neither skill nor experience nor sympathetic demeanor stands any chance of producing a positive experience for the insured.
DMA Claims (David Morse & Associates) is fast - very fast. You don’t have to take our word for it, just inspect the metrics below based on Xactanalysis data.
Xactanalysis is a claims program that is part of the Xactimate family. One of the benefits of Xactanalysis is precise measurement of vendor performance in terms of response time. The program is used by many carriers, and thus it is capable of providing "industry average" metrics based on tens of thousands of claims per month handled by a great many Independent adjusting firms.
The graphic below compares DMA performance (based on hundreds of claims per month) to "industry average" and shows DMA to be significantly faster in the key areas of contact and first report. The measurements are in days/fractions of days.
