What is the first notice of loss and why is it important to both policyholders and insurers?
Most people and businesses are often unaware that when they first contact their insurance provider to report a theft, loss, or damage, they are actually contacting a first loss notification call center ( FNOL). FNOL call centers generally operate 365 days a year, 24 hours a day, ensuring that policyholders can easily report a loss and furthermore that respective insurance companies receive timely claim loss data and precise.
First notice of loss trades are sometimes done in-house, but more often today trades are outsourced to a specialist. As you can imagine with any 24/7, 365 operation, staffing, training, and accurate receipt of claims is a challenge for any organization. There are different types of providers that offer solutions for FNOL, some offer software, others offer a comprehensive call center based on a proprietary application, and others customize their call center operation to fit any platform. These are platform-independent providers who claim to work with existing insurance company platforms.
Why is first notice of loss important to both policyholders and insurance companies? Obviously, the key function of a notice of loss is to alert the responsible insurer to the theft or destruction of something that is covered by the terms of the policy. In some cases, the notification will precede the filing of a formal claim. In certain circumstances, the insured may contact an FNOL representative and follow specific rules of engagement related to policy parameters. This often happens when a provider writes different types of insurance coverage and uses a specific format for each type of policy it offers to consumers. Herein lies the challenge for many insurers, and the frustration for many policyholders, as the policy specifications dictate both the information required and the resulting claims processing process. In many cases, speed is of the essence. For example, theft involving jewelry would require a very specific notification of loss, and prompt notification to authorities and the insurance provider can help improve the chances of recovery.
The first claim notice has also undergone a metamorphosis, offering insurers the opportunity to demonstrate their relative professionalism at a time when policyholders are likely to be upset and stressed. This is an optimal time, regardless of whether the call center is internal or external, to demonstrate a customer-centric attitude that increases customer satisfaction and loyalty. Therefore, First Notice of Loss (FNOL) is a critical component of customer satisfaction and retention.
