There is a huge demand for Certificate of Insurance (COI) in the market for a number of reasons. Some of these reasons include to inform the client of the key details of your Insurance Policy, to reduce unnecessary litigation in future, to reduce the quantum of liability in case of any eventuality, to provide easy access to the key details of a policy etc. While for the policy holder, it is proof that he or she has an insurance cover that is in existence as on date, for a company it increases its reliability and furthers its case for professionalism.
Processing a Certificate of Insurance (COI) can be a very tedious task. It requires an agency to look into documentation running into thousands of pages for one single client. Each day thousands of insurance policyholders may demand a COI. It may become practically impossible for the Insurance Agency to process all these in a reasonable amount of time. There are many other important and pressing matters that an Insurance Agency is required to handle. And processing a COI is not on top of the list of important tasks. However, not processing a COI in time may lead to a bad reputation and loss of goodwill. Therefore, hiring an outsourcing partner who speeds up the entire process of processing the COI efficiently through its team trained specifically for this task is a good policy decision.
Exact Functions of an Outsourcing Partner for the Processing of COI
To understand the functions of an outsourcing partner, one should be aware of the more important components of COI, which include:Insurance Policy coverage dates, Insurance Policy coverage amounts, who has issued it? – Insurance agent/ Insurance provider should issue this document, Insurance Policy Number, Vehicles (if any) insured under the Insurance Policy, Name of the Insurance Policy Holder, Key terms in brief, and other critical information.
The exact functions of an outsourcing partner are as follows:
- Certificate of Insurance:
The outsourcing partner is supposed to efficiently issue and process the Certificate of Insurance with proper details and updated terms and conditions.
- Certificate of Insurance Management:
Effectively keeping a track on all the Certificate of Insurance requests and processing them in the least turn-around time should be the primary focus of an ideal outsourcing partner for Certificate of Insurance services.
- Compliance of all the terms and conditions:
The Certificate of Insurance should be processed, keeping in mind what terms and conditions have/ have not been complied by the insured. All the crucial details have to be recorded in the document.
- Keeping track of all renewal requests:
The job of an outsourcing partner for COI services is to update itself and to systematically keep track of all the renewal requested by the Insurance holders.
- Issuing revised certificates:
Once the insured renew their policies, there can be a lot of different sets of terms and conditions. Issuing revised certificates after the renewal of the policy is a very crucial part that can be handled well by an experienced outsourcing partner providing COI services.
Some Reigning Misconceptions About COI Outsourcing Services
Before beginning with the misconceptions, let’s discuss in brief the concept of COI. COI is a document (physical/ electronic form) which is proof of the fact that your company has an insurance cover. It lists the key terms and conditions of your policy. Someone might have an insurance cover of thousands of dollars or lakhs of rupees, but that will be of no use to their clients, till the time that company has a COI to prove the same. Acquiring a COI can be a tedious job, and it can take up to months to get hold of your COI. The procedure of acquiring the same is very complex and extremely lengthy documentation is required to obtain a COI. Typically small business owners are the people who might have to show a COI.
Now that the concept of COI is clear, let us discuss in detail some of the major misconceptions:
- The first misconception is that the insurance agency executives can handle it.
While it is true that insurance agency executives can process a COI, however, they will take too much time. They are not well trained in this task, and therefore, they might commit mistakes. Thus, the insurance agency executives may be too occupied with these cumbersome tasks, leaving no time for the vital, processing issues.
- The second misconception is that the insurance agency loses control over the process of issuing a COI.
While all the documentation will be processed by the COI outsourcing services partner, the agency will still have control over business procedures and rules on coverage exceptions, overriding requests or changes, etc. The outsourcing COI partner will only provide services relating to standardising the procedures of reviewing and compiling of information from bulky sets of documents.
- The third misconception is that outsourcing COI services is very costly.
The costs depend on the agency itself. Some may be a bit heavy on your pocket, while others will align with your budget. For example, Insurance Backoffice Pro, which is the subsidiary of Flatworld Solutions, provides Certificate of Insurance services in USA, India, and other parts of the world. The rates offered by Insurance Backoffice Pro are very reasonable and standardised and are more affordable than the rates offered by other Certificate of Insurance services companies. The rates offered by Insurance Backoffice Pro are accepted across the globe. They are deemed to be a pocket-friendly solution for all types (small, medium, and large scale) of Insurance agencies.
What Are Some of the Major Advantages of Outsourcing COI Services?
There are broadly 6 benefits of COI outsourcing services. They are as follows:
- Scaling of resources and reduced costs:
If the Insurance Agency or an Insurance Carrier uses its current employees for such tedious and cumbersome tasks, they might become discouraged and exhausted with “not huge” results. Also, if the requests for Certificate of Insurance increase, that will prompt the agency/ carrier to employ more people. However, once all the requests are met, the new employees will be dead weights on the company’s resources.
However, on the other hand, if the outsourcing partner is providing COI services, they have the requisite resources and trained personnel to handle such tasks. These trained people work efficiently towards the completion of tasks in the least amount of time. Now if the workload reduces and the processing requests are reduced, the outsourcing partner can scale the resources employed for that task. Some people can be deputed for another task at hand. Scaling is easier when the job is outsourced. This does not put any dead costs on the company. The overall cost of getting the job done reduces manifold.
- Reduced risks:
Insurance agencies are always facing the threat of being defrauded. If there is someone on board who is not trained and experienced, there is a possibility of them overlooking certain fraudulent elements. However if there are outsource Certificate of Insurance services, and trained personnel are handling the task, they will know where and how to look and find out if there is a fraud going on in this particular policy or if there is non-compliance of the terms of the policy. This will reduce the risks and costs of the leading insurance agency/ carrier.
- Reduced turn-around time:
An insurance agency can utilise the services of its staff for a limited number of hours per week. In those limited hours, they have to accomplish other tasks as well. This might lead to the colossal processing time for issuing the COI. This is where the outsourcing partner comes to the rescue. They can scale up the resources as when the demand for COI increases. They can employ more trained people to accomplish the task of processing the COIs. This will reduce the processing time and subsequently reduce the turn-around time. That will help the Insurance agency in maintaining its market share and expect customer loyalty in return.
- Helps in building in Personal Branding:
The Insurance agencies/ carriers are facing competition for almost everything in the market. If the processing of COI is done efficiently, in very less time for a large audience, that will create a positive image (brand) for the insurance agency/ carrier. It will also help the insurance agency garner goodwill in the industry.
- Increased efficiency:
To accomplish such tedious and cumbersome tasks, streamlining the process is very important. Along with it, years of training and research on the most effective methods is also the need of the insurance agency. However, the insurance agency neither has the time nor the bandwidth to spend years streamlining the procedure to process COI. Yet, the outsourcing partner has already invested in researching the most efficient and effective procedure to process a COI. This reduces the cost of processing and does not put any weight of research, development, and training on the Insurance agency.
- Reduced costs:
COI outsourcing services will reduce the costs of hiring additional people to process the certificates. It will also reduce the cost of research and development of the most efficient and effective ways of processing these certificates. Lastly, development of streamlined procedures can take up multiple years and the Insurance agency, if it outsources COI services, will be able to take advantage of the streamlined procedures of the outsourcing partner from day one of hiring them.
Therefore, outsourcing of COI has an advantage of cost, increased efficiency, infrastructural ease, and reduced turn-around time.
What Are Some of the Challenges in Outsource of Certificate Of Insurance Services?
There are some inherent challenges that Insurance Agencies/ Carriers might face while processing and managing Insurance certificates and contracts, and which can be tackled very smoothly by an outsourcing partner specializing COI services. These challenges are as follows:
- Firstly, a very complex language is used in insurance contracts. Someone inexperienced can commit blatant errors while reading and comprehending the same. Its comprehension requires someone who is equipped and experienced in that field and specialises in the area. There are some very difficult tasks and industry-specific jargons, which can only be understood by the people who have been working in that area since a considerable period of time. This is where an outsourcing partner equipped to handle such documents since many years can come into the picture and help the Insurance Agencies and Insurance Carriers.
- The problem of Additional Assured Status is challenging to tackle. Additional Assured Status is when coverage is provided to individuals who were not initially covered under the policy. Insurance agencies staff is sometimes not equipped to deal with this, and there is a possibility of blatant errors while dealing with such certificates. While preparing a COI, it is pertinent to include the Additional Assured Status in the certificate. If it is not included, it can lead to incurring huge amounts of liabilities for the insurance agency and the person who has retrieved the COI.
Both these challenges, however, can be eliminated to someone experienced in handling COI services for insurance agencies.
Who we are and Why We Are an Authority?
Insurance Back Office Pro is a subsidiary of Flatworld Solutions. Insurance Back Office Pro is an ISO Certified company [ISMS (ISO 27001)] with its COI Services in USA, India, and other parts of the world. We have a global presence in 8 locations all over the world and provide services on all continents. We treat your data with the utmost confidentiality. We have well-curated policies for data security. Our teams are functional 24*7, and therefore, we give the time zone advantage. Further, we have the very well researched and streamlined methods of processing Certificates of Insurance and related services. Therefore, our turn-around time is comparatively less than our industry counterparts.