Martin Henson is regional head of claims at Allianz Global Corporate & Specialty (AGCS)
Claims Magazine: Can you tell us a little about your role?
Martin Henson: I am the London Regional Head of Claims for AGCS. The Region includes UK, Australia and New Zealand, MENA, and Ireland. While our local Allianz offices (e.g. Allianz UK) mainly concentrate on local businesses with a turnover of half a billion Euro or less, anything above that or with significant global exposure, is dealt with by AGCS. We also deal with all business in certain specialty lines. Being part of a global company makes us different – expertise in areas such as marine, aviation, energy, and financial lines, are concentrated in specific areas and utilised throughout the AGCS network. Hence we are Global, Corporate and Specialty.
CM: Can you give us an insight into how you write policies and your interaction with the local offices?
MH: We’ve got over 2,000 global programmes within AGCS. So let’s say it’s a UK multinational we’re working with. We would issue a global master policy here which would cover the UK operation and differences in limits and conditions in each of the country offices that the company operates in.
For most claims, the insured would deal with the local office under the local policy so you get the continuity of local service, but it’s all managed and controlled through the insured’s home country. That’s part of the service we offer, because we have the global reach.
It means that you can co-ordinate all your insurance purchases through one transaction. If you come to us with a property policy and you want to insure all your risks in multiple countries up to the same level; you can make sure that the risk manager can achieve the same level of cover around the world. The idea is that a risk manager sees us as a one stop shop. It’s a very co-ordinated programme.
CM: How has the perception of claims departments and managers changed since you entered the insurance business?
MH: I started off when I left school as an underwriter for Prudential. I then worked for Swiss Re for 10 years as a property underwriter and ended up as property underwriting manager, before joining Allianz as property and liability underwriting manager. I’ve run property, liability, and energy lines of business, as an underwriting manager. Ten years ago I was asked to take on claims. That was very unusual in those days, because you don’t normally get people switching from underwriting to claims, or vice versa.
Claims are regarded by some as being something of a back office service, a hygiene factor that you have to deal with in the same way that you have to collect premiums and issue policies. The cutting edge is often seen as underwriting and market management.
We’ve addressed the balance because we’ve got a lot better interaction between underwriters, claims, marketing and risk consulting. The claims team now sit with the underwriters – we’re all on the same floor and there’s great interaction.
AGCS have been pioneers in putting claims at the front of the business over the last 10 years. That means that when we’re in the tender process for a piece of business, nine times out of ten, a claims person will accompany the underwriters. A few years ago that wouldn’t have happened. We were one of the first to start doing it and now it is spreading across the industry.
It just shows that the claims function is gaining in importance. It makes a real difference how you handle a claim in customer satisfaction and retention, and it is much better if the client sees the team at the inception stage.
CM: What are the major issues that you are tackling at the moment as a business?
MH: Something we’re increasingly working on is scenario planning. So before we actually get to the stage where there is a loss, we discuss with the risk manager, broker, external loss adjustors and underwriters what might happen in different circumstances.
We test various scenarios, so that we would be prepared if something did happen. If you can effectively plan how to deal with 80% of scenarios in advance then that really helps.
There are numerous complex interactions that affect business interruption and contingent interruption, which means that you can be dealing with suppliers and customers anywhere in the world. If a key supplier happens to have had a fire and cannot deliver, that means that you can’t produce, which means that you’re going to start losing money. This is why a lot of clients are now taking a long look at supply chains.
The huge earthquake in Japan kick-started this and contingency business interruption became one of the biggest worries. One example was that a European company had a new technology item launching and the microchips for it were produced in Asia. The actual property damage suffered by the company was zero, but there were very significant claims that came from contingent business interruption because they were unable to complete the launch on time and had to find alternative sources of supply.
Where our own insureds suffer losses we aim to help them by making quick advance payments to allow people to get the business going again, restore confidence, and ultimately helping them to reduce their losses.
CM: There’s much talk of better use of data across claims. How is AGCS trying to improve its data management?
MH: We get a huge amount of data on claims and have created an internal unit in Munich called Claims Portfolio Intelligence and coordination. Data is used to give information to underwriters on types of losses, locations of losses, frequency etc. There’s a huge amount that can be learnt from claims data and in the large risk space, as an industry, we have not been great at utilising this data for ourselves.
We have also not been particularly good at utilising this data for the benefit of clients. We are currently developing a new online tool called myAGCS.com. The aim is for the claims information to be accessible to clients so that they can look at it at any time to see what’s been paid, see where negotiations and processes are, and analysing the data for their own benefit.
We are making a big push in the harvesting and use of data as we know it will not only help improve our service to our clients, but also potentially offer us a real competitive advantage.