5 Golden Rules for effective claims audits

  1. Why - Decide what it is you want to achieve from audits and the type(s) of audit required, eg. leakage, forensic. Know what are the most critical issues for your business, and know where to focus your attention on what matters most.
  2. What - Decide what you are going to do with the results especially if problems are identified. Think about how you will follow up (ensure results are seen by appropriate decision makers). There should be a willingness to learn, to do things better in future, not just to use the audit as a way to beat people up.
  3. Contracts - Ensure contracts with external suppliers allow and specify full audit rights. Make sure you can get access to their systems at audit. Do ensure you have effective technical audit procedures and programme in place. Don't rely on just the usual supplier management/procurement systems.
  4. Programme - Establish a timely programme of regular frequency audits and ensure they include a forensic claims-led review of all the data/management information which you hold.
  5. Authority - Ensure audits are seen as an integral part of normal business. The audit team must be experienced in the areas they are to audit and have the authority to 'command' responses. Use a mixture of internal and external people in audits, not just one or the other. In particular, inhouse auditors will benefit hugely from the experience and range of knowledge of external people, and this can build skills inhouse for the future.

For further advice on effective insurance claims audit programmes, contact CWMC today on 01327 830014.

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