Insurance is a big part of everybody’s life, especially for properties that you’ve worked hard to obtain. Insurance claims though are another story. H2M’s very own Patrick Kelahan, in this episode, shares his insights as a Property Insurance Appraiser, Customer Service Advocate, InsurTech observer, Customer Experience Defender, and Insurance Claim Improvement Advocate. He confronts the general ideas and knowledge when it comes to this business and dives in on what quality customer service in the insurance world should be. Understand insurance claims deeper while also learning about the challenges of the Insurtech industry and the changes it will encounter going forward.
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Improving Customer Experience In The Insurance World With Patrick Kelahan
I have Pat Kelahan from H2M Architects coming on board to tell us about customer service and customer engagement in the insurance industry. Pat is a veteran. He’s been in this for decades. He believes that is not just technology. It’s not just policy and procedure and process that make a good insurance industry, its people. It’s customer service and its customer engagement. Pat, it is great seeing you again. Thanks for being on the show.
It’s my pleasure, Ben.
Things are good. The world is a great place. People are buying. People are interested. People are seeing value in what we’re doing. It’s always an adventure and it’s always a different day. It’s a matter of going out there and figuring out, “What kind of trouble can we get into?” Let’s get into this. This show is all about how do you differentiate. There are millions of businesses out there. There are millions of companies out there that do similar things. It’s a matter of understanding what are the little things that companies do that make them different, special and unique to a certain audience. Why does that audience care about them? Tell me the story about H2M Engineering. Tell me the story about how you got there, what you do, why you do it, who you do it for and more importantly why do those people care about you?
I’ve been with H2M for a few months. I worked for about twenty years with Allstate Insurance; property claims, property claim management, audit and a lot of customer service. Prior to that, the Federal Government Disaster Program. I’m seeing a lot of people in adverse situations. I’m traveling and visiting people. Prior to that, construction then cell phone retail then big box retail. At age fifteen, I was working in a small grocery store in Syracuse. It’s four decades of customer service that I’ve been involved in. All different ways but they’re all customer service things. I wasn’t a widget maker. I never have been that way, not that that’s bad. All along, I’m doing these customer service deals. My most important job is being a father. I have seven children. My job mostly is to support my wife who’s a great mom and she works. It’s a great partnership but even that’s customer service, keeping the family going.
A few months ago, I was trying to find a work-life balance. I approached Rich Humann, he is the President and CEO of H2M and Mike Shanti, his Senior Vice President. I’ve worked with them for more than ten years with Allstate. They were our service provider for Allstate. H2M is a very large engineering firm. The piece that touches insurance deals with asbestos and wall and fire investigations, cause and origin, environmental, indoor air quality appraisal. They’re good services for insurance carriers. They’re located out on a Long Island. I approached Rich and Mike and said, “You are great company. I could provide an inside perspective from an insurance carrier side that would help H2M with continuing on their business and to grow their business.” At the time, I suggested perhaps Florida and Rich said, “Maybe someday but we’re looking to expand in Upstate New York, what do you think?”
We talked back and forth. Being frank speakers, we came to an agreement and I came on board. The most striking thing is they came up with a title called Forensic Market Strategist. Forensic, being the division of the engineering. That’s their descriptor for the market that they deal with for forensics. The strategist, that describe my role. It’s part working with insurance carriers and staff at H2M, but also looking forward in time to see what’s happening in the insurance world. If the forensic market relies upon insurance carriers for their business and they do. Mike Shanti over many years developed a great relationship with a lot of carriers. You need to know what’s happening in your customers world so that you can serve them better and react to what their needs are. Half of my role is being involved with that. That half of the role is how you and I became acquainted.
I’m much more involved in what’s happening in the networking amongst insurance worlds and marketing and such which comes to this podcast. Along the line, finding out that the big carriers are going a different way. Innovation and Ensure Tech is the catchphrase, the by word, the direction of things are going and trying to see how do I fit H2M into that future. Engineering is a whole different world than insurance. It’s a whole different culture. The speed of how things go, how they interact with customers is different than what an insurance carrier does. I’m trying to bring that. There’s my piece, there’s where I fit in. I’m the inside guy, the liaison, that type to see what’s going on to help H2M recognize new ways of doing business. Thankfully, they’ve been great allowing me a lot of latitude to do that. It’s going to pay off handsomely.
If you know your customers’ trigger points, you're going to build your brand as one that could be trusted. Share on XYou talk about four decades plus of customer service. I’m listening back to your resume of all the things you’ve done, the twenty years in Allstate, the disaster relief and the H2M now. It all has to do with the fact that wherever you’ve been, whatever you’re doing, you’re dealing with stressed out people. You may not be dealing with them directly, but the industry that you’re in has an enormous amount of people that are living under adverse situations. They’ve had fires, they’ve had floods and there are earthquakes. There are a million different things that could have happened there, even from a tree falling on the roof of their house and making a great big gap.
You’re dealing with people that are under an enormous amount of stress. From what I see, the insurance business is set up to, “Here’s a claim, here’s some money.” The human factor is what seems to be missing. You and I talked about this all the time. We talk about the human factor of the insurance business whether it’s insurance technology, whether it’s straight out and feel the insurance industry. It’s getting us back to human-to-human understanding and the human-to-human relationship. In the end, all businesses are about that. All businesses are about understanding the customers aches and pains and helping fix them. How do you go about working through that part of the business to be able to make sure that the human side of the business is not neglected?
I’m going to preface how H2M deals with their clientele. Many years ago, when I started in insurance, there was a smart guy. He didn’t come up with the phrase, but he always stressed, “You adjust the customer first.” In the insurance world, you could have claims from a little leak in the ceiling to a totally destroyed house. The person with the small leak in the ceiling could be more upset about that in their perspective than the person who lost the house. You need to understand, how is that loss affecting the person? The person with the leak in the ceiling, they’re living in that house every day. That piece of water stain in the ceiling is making them distressed. As opposed to the person who loses the entire house, there’s nothing you could do. You can’t live there, you’re somewhere else. You recognize it’s a terrible thing.
Understanding how the person with the spot in the ceiling reacts to it, then you can you can personally rack on how you’re providing your service. Taking that concept into all the different businesses that anybody could be in. If you see how your business customer needs to deal with whatever they’re dealing with, then you can adapt how you’re dealing with them. If you’re helping them do what they do, you win. If someone’s dishwasher fails, they go into the store. They’re not looking for dishwasher, they’re looking for clean dishes. You don’t care if it’s a dishwasher or if they send somebody there 24 hours a day that you don’t have to pay for, as long as your dishes are clean.
In the engineering world, if our customer is the insurance adjuster and the tree hits the house and they’re not sure about the full scope. If you understand that that adjuster needs to be there promptly, you need a detailed report. They need it all done pretty quick because their customer needs it. You understand what that adjusters going through. You understand they’ve got a dollar amount that they need to not control but manage. All of these things, understand what your customer needs.
Your brand will be built strongly because you’re working not from what you need to do, “I got to get this assignment. I’ve got to move to the next one.” You’re dealing with that one in that person’s eyes. What I’m saying is not new. It’s the oldest thing in the book. If you live it every day, if you’re a manager and you’ve got staff and you know that John Smith is having some difficulties in getting people out of his house to school. You say, “Why don’t you start ten minutes late?”
John Smith is going to perform much better because you’re recognizing what his needs are. He’ll still get the work done and you don’t have to say, “8:30 to 5:00, that’s what we’ve scheduled.” You adjust everybody first. I don’t care who you’re dealing with. Whether you’re in retail or you’re insurance or engineering. If you know what your customers trigger points, you’re going to build your brand as being someone who could be trusted and someone who understands. All of a sudden you get what you need, they get what they need. That’s how I’ve approached it throughout four decades. I’m not the smartest guy in the room, but I’m smart enough to get by, smart enough to get on your podcast. Trust and understanding what they need is what I see drives my brand if you want to use that phrase.
You talk about Insurtech, the new technology that’s driving the insurance business. What do you see are the benefits of the Insurtech industry? What do you see are the challenges that they’re facing moving forward?
If you look at Insurtech, it’s an offshoot of the financial technology like Fintech a few years ago. In finance it’s all numbers. It’s balance sheets, its profit and loss, it’s improving the data faster. Smart people said, “Insurance is information and it’s money. I’ll bet we can do this better.” In my research, Insurtech is heavy on the tech. Let’s understand underwriting pricing distribution. Those are data that you can remove and manipulate and such. They’re applications. What I see is missing there, most insurance is in big companies’ hands. It’s a huge market share. The customers are happy with it because that’s what it’s been for decades. If you change the technology up front and you do all that cool stuff, there’s this enormous administrative organizational bureaucracy that exists. It’s developed over decades. If you’re not adapting that, then the technology piece is fine, you can plug in this and that.
Most customers aren’t going to push an application and get their totally destroyed house paid for. Most adjusters’ goal is, “I need to get this claim handled and moved.” Now they’re dealing with, “I’ve got all these requirements that my company needs me to do. I’ve got a toggle this toggle. I’ve got to send this report up. I’ve got this regulatory thing to take care.” There’s the big piece in Insurtech that has yet to be addressed. What I mean by that is it’s an administrative burden. That is the friction which will inhibit Insurtech from going from the distribution piece to the customers hands. The customer doesn’t care what works in between, the adjuster and the administrative people do. At this point, one of my favorite phrases is, “Innovate from the customer backwards.” Dig in, find out what’s inhibiting the adjuster from dealing with the customer.
Often, it’s simple admin. I was at meeting in Toronto with my friends from Symbility, great people. A big life insurance said, “We held a one-day identify your problems session.” All their staff said, “Here’s all the little things, I don’t need to do.” They simply did some artificial intelligence, some robotic chat bot stuff and machine learning and whatever you want to call it. They eliminated a lot of those barriers. There are two things that happened. Number one, you get rid of the barriers. Number two, the employees are empowered to think, “We have something we’re doing here.” What did that cost them? You can’t call that tech so much. It’s more trust and understanding that the people that work for you knew what they were doing. That’s how I see Insurtech. A lot of smart people doing things, but have we gotten to the point where we’re eliminating the barriers to the customers understanding that it’s improvement? I’m not sure.
From an end user’s point of view, that’s where I see the challenge is. It’s wonderful to have technology. It may solve the company’s problem. It may make their life easier. It may make things easier for them internally. If they’re not making things easier for their customer, then the customer is stuck in the same old situation. It doesn’t matter how good the technology is, the customer are grumbling about, “A $2,000 bill showed up for my insurance policy again. Maybe I’ll go shop around and see if there’s a better policy.” They’re not seeing the value.
Ironically, you’ve touched on well. I’ve got some people that fight me on this, but insurance is a commodity. Its contractual and people say it’s not a commodity. What do all the big insurance companies do? They advertise on price, “I’m going to save you $100. I’m going to save you whatever.” When push comes to shove, most customers have never had a claim. All they see is the premium dollars and they’ll shop. When the claim happens, that’s where the rubber meets the road. Are you servicing your customer well? Is technology assisting that customer being resolved? Without the customer knowing because the customer doesn’t care. If they have a loss, they’re happy on one hand if you hand them a check. They don’t care how they to get to it, but they want to know what’s coming next.
It’s the communication piece. “We’re sorry for your loss, here’s the things that we’re doing to be able to take care of you. Here’s the things that are coming down the pipe and this is how we’re going to continually help you until this problem is resolved.” Some companies do this well, some of the companies not so much. Unfortunately, when you’re buying the policy, you have no idea until you’re in the middle of a claim. You have no idea how good an insurance company you have is or is not. It doesn’t matter if it’s insurance business or any other business. Most companies can do what they do every day well as long as things are going right. It’s when things go wrong and you still have to take care of the customer. That’s what proves whether you’re a good company, a bad company or a great company.
In the property insurance world, about a third of all claims are declined coverage. Share on XIf you take that to a little descriptive position, if you take Lemonade they deal with a lot of renters. If there’s a bicycle that’s lost or stolen, Lemonade is going to pay you in three seconds. If you have a bicycle that stolen, you’re not worried, “I get my money, I go get another bicycle.” Take that to the other extreme, your house is totally destroyed by a fire and the carrier says, “Here’s your check for $362,412.” What do you do with the check? Do you put it in the hole where the house used to be and hope it grows? Somebody has to help the customer understand what comes next. The insurance contract doesn’t say they have to do it. If you’re trying to differentiate yourself as a carrier, money is where you differentiate the purchase, to differentiate for keeping that customer. That’s where the money’s made in insurance retention. It’s how you serve them.
Every customer needs a different level and type of service. That’s the important piece. Insurance person or every employee needs a different approach. Your brand is trust, your brand is adjusting your customer first before you deal with the service. It’s interesting. Insurtech is great, I just don’t think it’s hit the big piece yet. Insurtech is great but are we touching all the people who need the service in the world or the underserved people? That’s another piece of it. You can’t stick to whoever you’re coming to. You’ve got to broad and beyond that claim customer and if there’s people who need the assistance in the insurance world through networking. You’ve got to help those customers as well.
You brought up AI. Everybody’s talking about AI. Artificial intelligence is a sexy thing. I’ve seen great AI and I’ve seen horrific AI. The great AI allows the end user to be asked a series of questions. As soon as the computer can’t answer any more questions or it’s too complex for the computer to deal with, AI needs a human being. It kicks you out to the right human being who’s got your information already on screen already logged in, knows who you are, what your issue is and can automatically start helping you out.
There’s AI that as soon as you get frustrated and you’re screaming, “Customer service, human being, real person” and hope to God the machine will figure this out. When you finally do, they get kicked over to somebody else. They have no idea who you are and what your problems is. You have to recount it and that little difference, is the difference between the poor customer service rep, on the other side, having a client they can sit down and work with or somebody that they’re going to have to spend ten minutes listening to because this person is frustrated. They’ve already recounted all this information and now they have to do it again.
Think about the two scenarios, you have one where the employee is empowered. Knowing what’s there. Their highest value is resolving problems. As opposed to the second person who continuously deals with persons who are upset. The employee doesn’t understand what information is left to rebuild it, which builds a frustration for the customers. All day they’re dealing with that. Eventually, that person gets frustrated to the point of departing the company. What they were promised by their employers that they would be helping people solve problems and all they’re doing is putting out fires. It’s a real big problem. Your point is well taken.
The turnover of those employees is astounding. Not only do you have customer service issues, but you have HR issues. You have hiring issues and you have all the backend issues. All of a sudden, you’re not only dealing with having to deal with the employees leaving but now you’ve got to hire new employees and train them. The expense involved in doing that is probably way more than setting up the systems right in the first place.
What if the C-Suite says, “Why isn’t our customer service department doing well? Maybe we should offshore.” You’ve got it somewhere else and you’re building even new problems. The customer service piece is design it well. Make training part of that design. Have the training be continuous and recognize all the road stuff needs to be sifted out of your process. Let AI take care of that. Train your staff for the highest and best value that they have and that’s interacting. If I look at that with H2M, we’ve got engineers that go out and look at people’s houses. Their expertise is looking at it and writing reports.
My expertise may be understanding what the adjuster needs and then whispering in the engineer’s ear, “Here’s what we need to do on this one that’s a little different than the last one.” Every case can’t be the same. We have to do the same thing. There are a lot of engineers around. How does H2M differentiate itself from all the other national vending engineers? We need to be prompt. We need to be thorough. We need to be prompt in our reports. We need to do things that the carrier needs and not just boilerplate everything. For the insurance world, it’s the same idea. Understand adjust the customer first. Train your staff well and get rid of all the junk that’s in your process. Let AI do that type of thing.
Let me ask you one last question. There’s a question I ask everybody. When you’re leaving a meeting, when you’re walking out of the room, when you close the door when you drive away. What is the one thing that you want people to think about you, the company you work for and the solutions that you provide?
I’m in those situations a lot. If I do a seminar, I do a presentation in front of some special investigators for insurance carriers. They’re looking at how am I going to deal with the fraud in the world? I’m looking at it. I’m an engineer. I want your company to use me for things. I need to adjust that presentation so that their take away matches up with what they’re up for an expectation is. They wanted to spend time to learn something to make their job easier, better, productive and lucrative, whatever you want to call it. When I’m done and I walk out, I’m hopeful that their take away is, “He talked about fire investigation for engineering. Now, I know, depending on certain things that they find, I can apply that to a fraud investigation.” Their goal is not to pay claims that are fraudulent and to get somebody arrested for fraud. Customizing what I do in every presentation and every discussion, understand what their end hope is to take away some little thing that they can use as opposed to, “Pat said X, Y, and Z.” It’s all stuff for them. I don’t want them to think I was only speaking to my needs. I know that sounds stupid, but I try to customize that. Any communication, any connection on LinkedIn. What is it that that person has that I can help with? Every communication not just presentations. I need to add value to them every time.
If customers believe that you have their best interests at heart, if you’re the one advocating for them, if you’re the one who understands where their pain point is, they’ll look to see, “Maybe he does have a solution that can fix our problem.” If it’s all about you, they can’t say, “We don’t need this and we don’t need that. We don’t need the other thing. That’s what Pat does. Pat took the time to understand what we do, what our needs are, where our pain points are, what our challenges are and he understands that. Maybe he’s the right person to be able to fix those problems.”
I’ll give you an example. In the property insurance world, about a third of all claims are declined coverage. That’s a tough conversation when an adjuster sitting in someone’s living room and says, “You’ve got this damage. It’s not covered” If you explain and then you say, “I know it’s not covered but I do know a few things about this. If you do this and this, you might be able to get this fixed without too much cost. Talk to this type of an extra to help you out.” If you understand what they need to take care of their concern. They’re not looking for you to settle their claim. They’re looking to have a fixed house. If you walk away and they understand how to fix their house, they’re disappointed that the insurance company didn’t pay but if they know how to fix their house. They’re well on their way to recovery and they will stay as a customer. Even though you told them something they didn’t want to hear. They weren’t shopping for an insurance claim settlement, they were shopping for a fixed house. That’s my best example.
Pat, thank you very much. You’ve been a great guest.
Thanks, Ben.
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I hope you enjoyed our conversation with Pat. It’s all about understanding how do you take care of individual people. As human beings we’re all different, we’re all unique and we all have different needs, wants, desires, hopes, fears and we all trust differently. The more you can understand that your customers are human beings and not just a number and they all need to be recognized, heard and understood, the better off you’re going to be. My name is Ben Baker and my company is Your Brand Marketing. We want to help you tell your story. How can we help you engage your customers in a meaningful way and have them turn around and tell that story for you?
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