Small Choices, Big Impact

Of late I have been attending a lot of spiritual programs. The core emphasis of these discourses is that this life is temporary and at anytime we may have to leave this abode. So while we are living we must prepare and channelize are actions to deserve a glorious death. Most of these discourses encourage a habit to simplify life and plan ahead. These teachings inculcate in us the habit of being more responsible person. After attending these seminars I feel that life is a celebration and should be lived that way. Pure celebration comes with discipline and sense control. One can celebrate life by eliminating or churning out worries from our lives. Worries can be eliminated by acceptance of the inevitable and counteracting the avoidable stressful situations of life.

Insurance is such a tool devised to thwart the financial impact of any such contingencies or stressful situations in life. People who are winners in life are always understood to be as good planners. They foresee the future and formulate action plans accordingly. Since I am attending these programs I am trying to bring lots of positive changes in my life. I am trying to take as much control of my life as possible. In these discourses I also learnt that our own attitude towards the problem defines the magnitude of that problem.

Now I would like to be less preachy here. Among the many things that I am trying to change in my life in recent times is calculating what all and how much insurance policies I must have to ensure maximum protection of me and family, of course keeping in mind my budget. In my search I found that the top two essential insurance policies that a family holder must have is term insurance and family health insurance.

Here in this article I would emphasis more on term plan as unlike health insurance plans many people have ambiguity about it. A term insurance policy basically aims at replacing the income of the earning person of the family. In the event of death of the breadwinner of the family the impact is double edged. Apart from the fact that the family is emotionally shattered a huge financial burden also befalls their shoulders. In most cases the family members have to lessen their standard of living. The adolescents may have to start work earlier and may have to sacrifice on higher studies. But if the person had taken term insurance plan and he/she dies in that stipulated term the nominees of the policyholder get a pre agreed amount called the sum assured at the time of death. This sum assured is generally twenty times the current annual income of the policy proposer (the bracket may change according to age and health condition). With attractive tax benefits under section 80 C and 10(10)D of the Income Tax Act,1961 these term plans also come with various useful features depending upon insurer companies.

Thus, I would advise you all to compare first before just buying. It is always favorable to get more and more number of quotes from different companies to get the best deal. Don’t just go for the companies you hear of from friends or whose advertisement you see most on TV. To get a fair and unbiased comparison you may take help of various specialized insurance comparison portals available online. According to studies, people have saved significantly when they have purchased insurance plans after comparing on these portals or service provider websites.

Unemployment Insurance – Purpose and Summary

Unemployment insurance (UI) is a form of insurance that American society has with itself. Its purpose to create a savings pool from which qualified workers can draw if they are out of work under certain circumstances. By receiving an income during periods of unemployment, recipients can afford basic necessities until they can again be productively employed. Considering how dependent the American economy is on consumer spending, the inability of people to engage each other economically can have drastic and eventually far-reaching consequences.

The UI social safety net differs somewhat from other welfare type programs in that it is not based on economic need, but upon past employment history and the circumstances surrounding the worker’s separation from their previous employment. People that have been in the workforce for longer periods of time are generally able to receive benefits for more weeks. Since UI is a form of replacement income, the dollar value of benefits a person can receive is tied to the wages they received while working.

Viewed from one perspective, UI functions as a type of government mandated savings plan for workers, by requiring liable companies to “hold back” revenue that could otherwise be distributed to them. Viewed from another perspective, unemployment insurance is a type of tax on the economic prosperity that the workers create. Either way the cost of UI to business is determined largely by the amount of potential future benefits workers might receive and the taxing policies adopted by those in charge of each state’s UI program.

Funding for unemployment insurance comes from two sources – separate state and federal UI taxes. Liable companies pay a UI tax to their state government, creating a trust fund for the payment of future benefits. These same companies pay a federal unemployment tax to the IRS each year. Annually, each state receives a grant of these federal taxes to fund the employees and UI services that their UI agency provides.

This dual funding mechanism mirrors the dual approach to administration that operates UI programs across the nation. Since the federal taxes pay for UI employees and services, the federal government sets out broad program requirements that the states must operate within as well as operating goals and targets that they must meet. For example, states must operate in such as way that a certain percentage of submitted UI claims are adjudicated and paid within 21 days. Since state UI taxes pay for benefits, state agencies decide tax provisions that fund the benefits as well as rules that allow or deny individual UI claims.

This structure, both for funding and operating the UI program, allows for a healthy tension to exist between the large and diverse stakeholder populations that can be impacted by the UI program.

Buying Financial Insurance in Canada

If you’re a Canadian and have been in the workforce for a decade or more, then you know that your income purchases less today than the first year of your working career. Inflation is a part of our society and while our government continues to devalue our money by printing more and more of it, inflation will undoubtedly continue. This is not only a Canadian concern though. All around the world people are feeling the effects of inflation due to excessive money printing; but more on that another time. The long-and-short-of-it all is this: YOUR MONEY WILL continue to BUY LESS as the years go by.

A quick 100-year calculation using the Bank of Canada (BoC) inflation calculator showed the cost of a fixed “basket” of consumer purchases in 1915 was $100.00. At the end of 2015 that cost was $2,083.61. More recently, over the last 10 years prices have gone up 18.01%. Has your income gone up by the same or greater?

The answer is probably, No.

Whether you’re a six-figure earner or you make 30k a year, your “money” is losing buying power. There are a lot of ways that you can protect your money from devaluation but we’ll discuss two common options people take.

One option is the stock market; put a lump of your savings into a portfolio and see what happens. Sounds like gambling to me. But if you’re prepared to leave your finances up to other factors (and people) other than your own due diligence, then putting your money into stocks may be a good fit for you under the following two conditions:

  1. You have the stomach for volatility and,
  2. Your primary objective is to see a substantial return in a short period of time… hopefully.

Another option, and this tends to be the easiest and most selected, is to open a bank savings account. No hassle involved; just open the account, decide how much you want to save and how often, put it on auto-pilot and watch your savings grow.


In today’s economy, bank savings accounts are not a viable savings vehicle. Most of the interest rates offered are earning below inflation rates. The sad reality is many savers make a future withdrawal only to realize that thy have lost money on an after-inflation basis.

So, what do you do if you’re not a savvy investor?

Buy financial insurance.

We have insurance for almost every aspect of our lives yet insurance is something many of us hopes we never need to use.

Buying financial insurance in Canada, or anywhere else for that matter, is putting your money into a vehicle that is protected long-term from the ups and downs of the volatile economy.

Buying financial insurance preserves your buying power and provides a hedge against inflation.

The global economy is changing but the only economy that should matter to you is yours.

How to Find the Best Insurance Agency

When you need coverage, you should look to your insurance agency to find the right policy. You might not be aware of some of the policies available to you. While you might think your traditional insurance will cover everything, you might be surprised to find out where traditional homeowner’s, rental, medical, and car coverage fall short.

Different Types of Coverage

If you should determine that you need any of these supplemental options, you should check with your insurance agency to find out whether they offer the coverage in question. Not all underwriters offer these policies. You may have to get these supplemental offerings from other agents.

If you have a dog, then you might want to purchase a dog bite or “pet liability” plan. While you might think that your four-legged friend would never harm anyone, there is always a chance that it could happen. According to the Insurance Information Institute, half of all incidents happen on the owner’s property. While homeowner’s liability may cover the medical costs, there can be complications, such as when incidents happen away from home. Having a specific dog bite policy will handle any unforeseen problems.

Those who live in coastal areas will want to get flood insurance. This protects your belongings from damage due to floods. What most homeowners don’t realize is that traditional homeowner’s plans do not cover this damage. That is why it is important to purchase these policies separately.

Burial coverage gives your surviving family members money to pay the cost of your funeral and burial. The cost is nominal, totaling only a few dollars a week or month. This policy is not often sold through a traditional insurance agency. You will either have to go to a broker or purchase from a funeral home.

Personal electronic equipment policies give you more protection than the standard homeowner’s plan. A traditional plan does not cover damage caused by installation errors. These programs offer repair or replacement of electronics such as computers, stereos, and televisions.

If you have valuable items like jewelry or high-end electronics, then you want to have supplemental coverage. While your homeowners plan does cover some items in the event of fire or theft, it does not cover everything.

Some businesses offer their full-time employees short-term disability. However, if your company is not one of those groups, you should look into having short-term disability added. Medical plans will help to cover bills from doctors and hospitals, but it will not help to cover normal monthly bills that can pile up if you have to miss work. While not all short-term disability programs are the same, it is something you should check into to ensure that you don’t fall behind on your bills.

You need to research and understand the different types of coverage available to you. If you are unsure, an insurance agency can assist you in finding the information you require.

Construction Insurance Protects Your Employees and Your Investment

The building profession is a diverse field. Construction workers are employed in a variety of commercial and residential settings and use an array of different tools and materials. As a result, each site presents unique risks for personal injury or property damage. Construction insurance is necessary to protect contractors, subcontractors, and property owners from litigation resulting from an injury or property damage connected with the building process.

However, purchasing construction insurance is not just a wise business investment. Policies may be required when providing services to the federal, state, or local government. Many private entities will require coverage as well. Your employees, clients, and the public all benefit from comprehensive coverage in the event that something does not go as planned. Potential clients also look for these protections as a sign of professionalism when hiring a contractor.

Construction insurance works by protecting the contractor and any injured parties in the event of property damage or injury at the job site. This type of policy is referred to as commercial general liability insurance. Parties protected generally include the party agreeing to the services and members of the public directly affected by the work.

The insurance company will pay for any accidental injuries or property damage so that the business owner does not have to pay from his own pocket. Legal counsel will also be provided in the event your business is sued as a result of an accident. Negligent behavior and deliberate omissions or errors are not covered by these policies. Typically, the policies are effective during the time the contracted work is ongoing. However, issues may arise long after the completion of the building. These problems can often be addressed when creating the agreement by adjusting some of the language.

A builder’s risk policy indemnifies against damage to the building while under construction. It protects against damage to fixtures, materials, and equipment used in the building or renovation process that may be caused by fire, wind, theft, or vandalism. Cars and trucks used in connection with the work and driven by employees may need coverage as well. Design professionals like architects, or others engaged in designing any aspect of the project should have professional liability coverage.

Workers compensation is another type of coverage that may be required in your state. These policies protect workers injured or who become ill on the job site by paying medical bills and disability claims. Finally, a bid bond may be required under some circumstances. This is a proof of guarantee to the project owner that a contractor can perform the work required and is a promise that the owner will be compensated.

Consult with an agency experienced in serving contractors, subcontractors, and property owners if your project requires construction insurance. An experienced agent can help identify risks and potential losses in order to determine what plans will cover your needs.

Five Ways to Effectively Tackle Insurance Fraud

Insurance Fraud is one of the top challenges that insurers are facing worldwide. While there are pricing pressures owing to slow economic environment, cutting back the Claims payout is one of the best means to increase efficiency and cut cost. From a strategic perspective also, carriers overall success to a large extent depends on the manner they treat their Claims function; for many insurers Claim processing efficiency is often their unique selling proposition. Reducing Claim leakages by effectively fighting against insurance Fraud and having a larger focus on recovery management can help insurers reduce their Claim cost.

This article is an effort to highlight five key areas that should be considered when building an effective Fraud management strategy.

1. Underwriting Prudence

Claims and Fraud management begin much before the Claim incident is reported. There are several indicators that can raise suspicion during the underwriting process. After the Claims are settled, the Claims data can positively impact the underwriting and rating functions. There is a need to incorporate more information into the underwriting decision-making process. The responsible use of data and information during the underwriting analysis is one of the most powerful weapons against Fraud.

The organization should know its prospective customers well to find fraudulent intentions beginning the review of sales proposal. An attempt should be made to dig deeper to verify identity and every application must be individually scrutinized. The goal of reducing Claim leakages should be kept in mind from the very beginning and the Fraud fighting mechanism should be activated from that moment.

2. FNOL Management

From a Fraud perspective, effective management of First Notice of Loss (FNOL) process is crucial for the insurance company. Through improved workflow, streamlining the processes and use of automation, insurers can identify the Fraud triggers and recovery possibilities early in the Claims cycle. The insurers should make use of early warning systems like, Voice Analytics for timely identification of Fraud. There are key factors for example, who reports the Claim (Claimant vs. Attorney Vs. anyone else); the time when the Claim is reported (Immediate vs. Delayed reporting); and the manner in which Claim is reported that can raise suspicion on the genuineness of the loss.

Any delay in identifying the Fraud triggers can have serious consequences later. If the decision to make an SIU appointment is late, the insurers can lose important eyewitness that can affect the Fraud analysis and the recovery possibilities. Any time lost during this stage will cause more than four times efforts, time and cost in the future. To fight the Fraud in an efficient manner, insurers have to be wiser and faster in comparison to Fraudsters. The use Data Analytics to narrow the possible number of Claims to be investigated for Fraud is vital. The insurers can then pay attention to those Claims, where high probability of Fraud exists.

3. Developing an Effective Claims Team

Effective deployment of resources is an important part of the overall Fraud management. Any organization that wants to effectually handle Fraud, must rebuild the Fraud investigative skills and capabilities. It should hire people with solid investigative skills to build a strong SIU unit for Fraud handling. By virtue of their experience, investigators who have worked for the FBI, Police and other investigative agencies can bring more value to the table.

The employees should be equipped with the necessary resources and a well-defined training program should exist. There should be online education and awareness programs through an Online Claims monitor on recent Fraud to the Claim handlers and investigators. Claims people should encourage feedback from the Claimants as a quality improvement tool. There should be a seamless link between Claims personnel and underwriters to make sure the overall business perspective is maintained and followed.

The aging of the baby boomers and the lack of skillful resources is resulting in heavy reliance on automation and investment in IT. Management should have a well-defined strategy to retain employees with key skills through the workload and work-life balancing. The goal of containing Claim leakages and rebuilding investigation skills and capabilities cannot be met unless the organization has a well laid out and forward-looking re-sourcing strategy.

4. Use of Technology

One of the problems being faced by Claims Organizations these days is the increased use of manual processes with limited use of tools and technology to manage processes. It is often found that the Claims Division in an insurance organization is one of the departments that are working with less-than optimal systems with huge maintenance cost. The need of Advanced Technology and Analytics in the Fraud handling cannot be over emphasized. The insurers should develop an integrated Fraud program with full policy life cycle consideration having clear defined Fraud management goals that are aligned to the business model.

With the number of people using social media sites, increasing day by day, the insurers should even consider social network analysis. The integration of Claims systems with social networking sites can prove to be an effective tool for Fraud detection. For insurers where the fraud leakage is on the higher side, it can even consider integration of IT systems with outside law enforcement agencies’ like the FBI, Interpol and DMV. The automation of the decision-making process based on business rules can also help in streamlining and standardizing the Claims process.

5. Information Sharing

Often it is found that different functional areas within an insurance organization do not talk well with each other. Thus, there is a greater need to strengthen data sharing between various departments specially, Underwriting, Claims and Finance. There might be similar Fraud patterns and issues across other lines of business, like Workers’ Comp, Commercial Auto and Crime. Having access to look across different coverage types for common behavior will be critical to success when combating Fraud. Besides, the companies should collectively work towards the maintenance of Fraud databases to have all the information in one place. This can aid in the analysis of Fraudulent Claim by comparing with old Frauds and grow the institutional knowledge and capabilities of the Fraud management.

There should be a centralized Fraud module where the findings and reports from Claim handlers and investigators are documented and available for anytime review. With Fraudsters becoming more sophisticated in their approach, there is a greater need for increasing industry collaboration and sharing of leading practices among insurers to combat Fraud.

Do You and Your Insurance Company Know Your Liability?

Do you and your Insurance Company know your Liability?

Traffic signs are everywhere. They provide us with warnings, directions and information. They can be found along public roadways, private roadways and parking lots. As of June 13, 2014 all agencies with public and private roadways which are opened for public travel are required to have a traffic sign assessment and management plan in place.

I know what you are thinking, that’s great the government has more paperwork to add to their already inflated bureaucracy. Though that may be the case, if you are a commercial or industrial business, mall, shopping center, home owner’s association, convenience store, gas station, just to name a few, with a parking lot or roadways, you should be preparing for traffic sign Retroreflectivity.

Why should you be concerned or taking note of traffic sign assessment and management? Well simply put if you allow motorists to drive on your property, which would almost be impossible not to, you are entering new realm of possible liability.

You along with your Insurance Company should know what the failure to prepare and plan for traffic sign assessment and management can mean. I bet most agencies and businesses don’t even know what traffic signs are their responsibilities.

Why don’t you humor me and let me give you an example how this can affect you. When your property was built, more than likely you or the owner at the time had to obtain a driveway or highway occupancy permit to enter and exit the public roadway. More than likely your plan had a stop sign at the entrance, no big deal, right? Wrong, if a driver leaving your property pulls out into the path of an oncoming vehicle and there is an accident, one of the things that the investigating agencies will be looked at is whether the proper traffic signs are in place and in operational condition. They will look at the signs in helping to determine who is at fault. Maybe not a huge deal if it is a fender bender, but what if there are major injuries or even worse a death. Now you can be certain the insuring parties, or family of the injured or dead are going to be looking for someone to pay for the damages and pain and suffering.

Get my point! In the example above we are only talking about one sign, a stop sign. Let me ask you a few things that the investigators will probably asking.

Property owner, what was the date the stop sign was installed? Do you have records of the purchase? Did the stop sign meet the highway traffic sign standards at the time of installation? Where did you purchase the sign? Was it installed to the proper height and mounting standards as required by the highway standards? When was the sign last assessed for compliance?

Holy cow! As a property owner how would you know any of that information? Simple: a traffic sign assessment and management program.

Now many permit and civil plans for properties have more than one stop sign on them, many have multiple signs. Did you also know that some state, county and local agencies add wording to the permit plans that give responsibility for the new roadway signs added during construction to the property owner. I know, you are asking why, would they do that. Simple, alleviate or pass the responsibility to someone else. Smart on their part, but bad for you and you insurance company.

The MUTCD (Manual on Uniformed Traffic Control Devices) is about to make all of our lives a little bit more interesting. I believe the door is opening for a flood of liability claims relating to traffic signs. The MUTCD and Federal Highway Administration have stated that private roads open to public travel are required to meet provisions of the MUTCD, including the minimum retroreflectivity standards. I know some people will argue that parking lots are not included, however I believe this extends to parking lots. My logic behind this is that there are drive lanes in a parking lot and what is a drive lane other than a private road. But hey I will let the lawyers argue that point in court.

A statistic obtained from Auto Insurance, indicated that Nationwide Insurance’s 2012 claim data showed 13 percent of all accidents occur in parking lots. During my research I have found that injuries to pedestrians are one of the fastest growing types of accidents which occur in parking lots. So my next question is are your Pedestrian crossing signs compliant?

As you can see, I am trying to make a point, if you do not have a traffic sign assessment and management plan in place or think that it can’t happen to you all I can say is good luck. But just remember an implemented plan may be the cheapest insurance you could purchase.

8 Major Income Protection Myths Debunked

Insurance products aren’t the easiest of things to understand and income protection insurance is no exception. With cumbersome key facts booklets and the media citing stories of context-specific consumer-insurer battles, it’s no surprise that many people misunderstand exactly what it is and what it specifically offers.

Outlined here are eight major protection myths demystified, so that next time you hear something about income protection, you’ll be able to separate fact from fiction.

Myth 1: It doesn’t pay out

Provided that the policyholder has kept up-to-date with their monthly premiums, and has given truthful personal information from the outset, claims are nearly always paid out. In fact, last year in the UK, insurance providers paid out over 90% of successful claims. If you’re still unconvinced and want to double check specific insurer payout rates, most of them now provide easily-accessible claim statistics on their websites.

Myth 2: It’s too expensive

This myth is purely subjective. If you were a smoker in a high risk job and wanted a very high level of cover, your premiums would, of course, be costly. For the majority however, income protection is affordable and can cost as little as 30p per day. If you want significantly lower income protection insurance quotes, consider buying through a commission free broker or by extending your deferral period – the amount of time between a claim being made and the money being paid out. Premium rates are calculated based on your age, health, smoker or non-smoker and occupation, so if you’re serious about cutting the costs of premiums, it may also be beneficial to adopt a healthier lifestyle.

Myth 3: It’s a waste of money

When it comes to ill-health and injury, people can feel a sense of invulnerability, and so it’s all too easy to see how this kind of myth circulates. But ask anyone who’s used their income protection policy, and they’ll be the first to debunk this notion. If you were unable to work due to illness or injury, the monthly instalments provided by income protection could become invaluable, affording reassurance that bills, loan repayments, and any other expenses could continue to be financed during your time off work.

Myth 4: It isn’t necessary if you receive benefits

Statutory sick pay and other benefits tend to pay no more than £400 a month, which for most, would not cover the rent or mortgage. An income insurance policy however, would pay up to 75% of your usual income, comfortably covering the costs of your living.

Some employers will provide a more comprehensive benefit than statutory sick pay. Therefore, it’s important to check if this applicable; as this may mean that your deferral period can be extended which can, in turn, lower premiums.

Myth 5: It’s the same as PPI

Although they may sound similar, income protection and payment protection insurance (PPI) are not the same products. PPI insures a specific loan repayment, whereas income protection is designed to cover a portion of your income. If you found yourself unable to meet your mortgage repayments due to ill health, PPI would be on hand for this, but what about all the other inevitable expenses? This is where income protection comes in.

Myth 6: It’s not necessary if you have critical illness cover

Whilst critical illness insurance is important, unlike income protection, it would not pay out if you were unable to work due to injury or if you developed a non-critical illness. For this reason, income insurance may be worth considering along with critical illness cover, as this would cover a wider range of eventualities.

Myth 7: It’s not for you if you’re self-employed

Self-employed people can get income protection insurance, but be prepared to provide the relevant documentation. If you’re self-employed, your income may be more variable, so it would be beneficial to regularly review your policy to ensure that you’re covered for the amount of money you require.

Myth 8: It takes too long to apply

Whilst this may have been true in the days of dial-up-internet and telephone brokers, thanks to user-friendly websites, it is now easier than ever to search, compare and buy income protection policies.

Surety Insurance May Give You Peace of Mind

In a world where unforeseen consequences can lead to costly damages and potential lawsuits, managing your risks is an absolute must. When looking for ways to mitigate risk in an investment, such as a car, house, or expensive work of art, people often turn to major insurance companies. In theory, paying a little each month can protect you from sudden financial disaster in the future. While these companies have good intentions, the reality is often much less idyllic. Companies often try to deny claims or take forever to process payments, leaving you stuck with a mountain of debt while you try to keep your investments afloat.

Contract Work

Particularly in contract work, standard liability coverage often leaves much to be desired. When allowing a contractor to work in your home, install an air conditioner, or run new power lines, you are taking a huge leap of faith that the company will behave ethically and do their work up to code. While most reputable companies carry liability, there is simply no way to guarantee that their coverage will provide you with the compensation you need when their mistakes cost you thousands of dollars in damages. To mitigate this risk, surety insurance has become a preferred means of protecting your investment. This type of protection, often called surety bonds, offers a unique method of controlling the way funds are distributed in the event of a disaster. Rather than spreading settlement payout across a myriad of clients, surety insurance is a three-way agreement between a customer, a contractor, and their bondsman. With stricter guidelines and a clear understanding of responsibility, these bonds allow payment to be treated like a bank loan rather than a sudden cash windfall. By cutting out the major corporations, homeowners are able to hold contractors accountable and seek damages as soon as they know shoddy work has been performed rather than after catastrophe has struck.

Public Works

Surety insurance is also beneficial in the case of public works. When building a park, statue, or other municipal attraction, city and town governments rely on one major overseer to manage a large number of subcontractors. Often this primary job lead is the only point of contact for the various electricians, sculptors, and carpenters working on the job site every day. While this manager hires out the work and can make agreements for compensation on his own, he will not be the one receiving complaints should any subcontractors not receive their due. Dissatisfied workers will climb as far up the food chain as they can and head right for the biggest wallet. Liability protection held by a contractor won’t save the city in this instance; only a qualified bond will do the trick. The township can activate their agreement and settle payment directly with the workers without any scandal or lawyers whatsoever.

Whether you are building an addition to your home or rebuilding the town square, make the right decision and cover yourself with surety insurance.

How to Evaluate the Right Claims Management System for Your Organization?

With continuous changes to the software industry, Claims Management Systems (CMS) have evolved with technology. These systems are equipped with newer capabilities to provide enhanced services to customers. In such situations, evaluating and selecting the right CMS for your organization could be a difficult task. In order to assist with this process, we furnish a few simple steps through which you can evaluate and choose the right CMS for your organization.

Check the efficiency and responsiveness of the system:


• Claim management systems are crucial to making the customers satisfied and to improve the overall performance of the company. A CMS should be able to manage the entire claim process – from the beginning to the final settlement. The software should help in organizing every file activity and maintain reports.


• In addition to performance, a CMS needs to allow the user to run reports instantly. The ability to quickly access information will expedite the claims, allowing employees to return to work, and employers to save valuable resources.

• A transaction – accessing and saving a claim, creating letters, etc. should not take more than 10 seconds, and on an average it should be done only in a couple of seconds.

• While evaluating the performance and response time of the CMS, ensure to check them in a real time environment with and user data. This will give a complete picture of the performance and the responsiveness of the system.

Technology used in the system

Today, many organizations prefer browser based systems that help them simplify deployment, support, and allow for remote access.

• While evaluating the technology, check the type of database being used. It is important to choose the right database with a simple and efficient data model. This will help create reports and data mine independently.

• A critical issue that goes unchecked by many organizations is with respect to the reporting database. The reporting database should be kept separate from the transactional database as it impacts the system performance.

Security, confidentiality and hosting model of the system

Security and confidentiality of the data

It is the responsibility of the organization to keep the claimants information secure. In order to keep the data safe, it has to be encrypted with multilevel access passwords. All users should be given unique ID’s and passwords with no plain text.

• To reset the password and protect system security, do not allow viewing of the old password.

• Data to the user and from the user should be encrypted using a SSL encryption. Along with this, user access permissions, levels of authority, hierarchy, etc. – are necessary to ensure security and confidentiality.


• If your organization possesses adequate bandwidth and infrastructure for supporting new applications you may want to consider hosting the system.

• If not, hiring a reputable web host is you best alternative. Be sure to confirm the system is always accessible and is supported without any interruptions in the services. Additionally, in choosing a web host make sure that there is equipment redundancy and document backup to ensure data is replicated without any loss.

Functionality and features of the system


• For every CMS, there should be some basic functional modules such as claim/claimant maintenance, notepads, diaries, reporting, payment and reserves, etc.

• Check the functionality that will help the examiners to focus on closing claims quickly. You can ask various questions regarding the functionality of the CMS, depending on your business requirements and workflow.


• Check the features of the system and all the data categories that your organization needs.

• The system should enable users to build data fields as the organization grows and risks become more complex.

• Check for the software integration. This gives the new capabilities in settling the claims quickly and efficiently.

Vendor assessment

Once the system meets all the required guidelines, it is necessary to assess the vendor. In order to assess a vendor, several factors should be considered.

Clients’ needs

• An efficient vendor should constantly work on improving the system, based on client needs. They should be to discuss new functionality and any challenges with implementing system enhancements. Ask any potential vendor how often they meet their clients for discussing such issues.

Other factors (past experience, etc.)

• Consider vendors past experience. How efficient they are in research and development of new technologies? How effective are they are in knowledge transfer?

• References would assist in choosing the right web host. This will provide appropriate insight to what a relationship with the vendor will be like in the future.

Pricing structure

• Pricing structure should be flexible for each client. Depending on size and need, each contract can vary greatly. Terms of payment should also be flexible in order to allow companies of all sizes to find a system that works for them financially. A CMS with many users should cost less per user than that of one with fewer users.

Following these points can help evaluate the claims management system (CMS) quality parameters, and check how well it suits your business.