17th April 2015

Nick Balcombe Speaks at The Post Magazine Claims Club: Importance of loss adjusters must increase for UK to regain status as pre-eminent insurance market

The following is an article from The Post Magazine by Jonathan Swift:-

Nick Balcombe

Insurers need to cut out bureaucracy, the role of lawyers has to be reduced and importance of loss adjusters increased if the UK is to regain its position as one of the world’s pre-eminent insurance markets.

That was the view of Harris Balcombe partner Nick Balcombe who shared some reflections on his 51 years in the market at the second Claims Club meeting of the year.

He told delegates that in the past no one needed lawyers and forensic accountants to settle claims as the loss adjusters were skilled enough to get the job done: “Very few dubious claims ever got past those people because they knew what they were doing.”

He added: “But I feel that in today’s loss adjusting world we do not have that same quality because insurance companies have taken it away. I also fear that some adjusters have shot themselves in the foot by selling themselves for tuppance ha’penny. It simply does not work. You cannot send out a proper person to deal with a claims at £50, £75, £100, or whatever it is.”

Balcombe continued: “I also believe that insurance companies have developed so many layers of authority within themselves that you can never get a decision out of anybody these days. I find it very difficult and frustrating that it takes an inordinate amount of time for anything to be processed. Treating customers fairly was a saying we did not have in the sixties because we did not need it as all of our clients – and those of the insurers and brokers – were treated fairly. If a claim had to be paid, it was paid. We did not have all the delays that are thrown into the melting pot these days which I find quite unacceptable.”

Balcombe noted he was currently working on a number of committees set up by the British Insurance Brokers’ Association that were looking at best practice within the claims space and what lessons could be learnt from overseas.

“I remember when the UK was the leader of the world’s insurance market,” he said. “I remember when I spoke with colleagues in the US and the stories we could tell were second to none. Well I’m afraid parts of the world have caught up and overtaken the UK and I would like to be part a team that tries to get a world beating service back in the UK.”

Among his suggestions to improve the situation was to give authority back to loss adjusters to settle claims and remove impediments to speedy settlements, such as second signatures on cheques: “If you cannot have money transferred to a client’s bank account within four to five working days of agreement then there is something seriously wrong and that needs to change. Because an insured that has suffered a loss need funds to keep going and that money should be transferred immediately.”

With regards acceptance of liability, Balcombe said the UK should follow the US, in making insurers accept or reject it within 28 days of a loss occurring; Or alternatively go to court to explain why it cannot do either: “In US, claims that should not be paid, are not paid, ones that should are promptly. It makes a big difference.”

Balcombe also thought the UK should have a law like Florida that means loss adjusters cannot be loss assessors: “It will remove from our industry the cowboys who try and play both sides of the fence, which I don’t think should be allowed.”

He concluded by saying that claims preparation costs should be standard on policies as they are in Australasia, certain US states and European countries: “If the insurance market is serious about TCF, I believe that claims prep cost should be on every single policy.

“Whether that would mean we would have more loss adjusters becoming assessors I don’t know. It is important for the insured to be correctly represented and don’t understand how major carriers can issue policies in Australasia with them included and then in the UK without. It is something I have been fighting for a long time and is something I think should happen.”

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