Claims during the COVID-19 Pandemic and Managing Expectations of Austral’s Insureds 

When processing claims, insurance companies need to seek to manage the objections they receive through good faith and good communication, as is set out in the Brazilian Civil Code, which states that the insurer defends the legitimate interest of the insured (Art. 757). 

While good faith is necessary from both sides right from the time of purchase of the policy, in the adjustment phase we also observe this requirement scrupulously. Based on this premise, the adjustment process—from the notification of claim up to its conclusion, whether through a settlement or even through a denial of claim—requires extreme diligence in how it is handled.

By setting timelines with all parties to the claim—insureds, brokers, consultants, regulators, even reinsurers—we can have a better understanding of the progress of the determination of losses, what is required in terms of time and labor to move on to the next stage, and what the expectations are of each party at the end of the claim’s adjustment.

Once the team is put it place for analyzing the case and the extent of the damage and losses based on the terms and conditions of the policies, it is essential that concerns be well-managed, starting from the very first communications. And in times when there is latent psychological strain, such as in the pandemic endured in 2020, our most powerful ally is good communication. To avoid upsets or assumptions, apart from the technical expertise of the professionals involved, the success of the claim adjustment is based on just a few premises: clarity, objectivity, and, above all, transparency. These are the key words to be kept in mind from the time of purchase of the insurance up to the settlement or denial of the claim.

In addition, just as in any contract involving major risks, the clauses are essential; thus, the next step after receipt of the claim notice is contract analysis wherein the event, coverages, and exclusions need to be evaluated. At the time of adjustment, there is a duty to observe the limits that were put in place at the time of underwriting, as well as the provisions in the insurance contract and the policy itself.

In times when contingency measures never before seen in the modern world are being  implemented, the primary challenge faced during the COVID-19 pandemic has been to remotely plan and execute adjustment strategies. However, if due diligence is done and issues are handled with transparency, the primary stakeholders will be kept in the loop of all developments in the adjustment process. This way, misunderstandings are reduced or even eliminated, clearing the path for the best possible alignment among all parties involved.

In times when contingency measures never before seen in the modern world are being  implemented, the primary challenge faced during the COVID-19 pandemic has been to remotely plan and execute adjustment strategies.

Finally, a big part of this are Austral’s excellent consultants, who are skilled and suited to the task they have been assigned, and who especially share this philosophy, to achieve success in the management of the concerns of all parties involved.

Contributors: Aline Marques and Giselly Monteiro.