Initiatives to Improve Operations Related to the Claims Payment Administrative System
August 13, 2008
Sony Life Insurance Co., Ltd., a wholly-owned subsidiary of Sony Financial Holdings Inc., conducted an investigation into the status of its inadvertent under-payment and nonpayment of insurance and other claims during the period from April 2001 through March 2006 and announced the results of its findings in a news release dated October 5, 2007. Sony Life recognizes that the payment of claims is one of the most fundamental operations of a life insurance company, and apologizes sincerely for this lapse.
Sony Life has made additional payments that investigation results identified as necessary. Furthermore, the company has made the establishment of a claims payment administrative system a top management priority, establishing a "claims special project for introduction of countermeasures to strengthen its management structure relating to the payment of insurance and other claims" as part of its ongoing effort to improve operations related to its claims payment administrative system.
The status of these efforts is reported below. Going forward, Sony Life will regularly disclose its progress on these initiatives as part of its vigorous efforts to recover the trust of its customers. The company will also put forth additional efforts to raise its level of services.
Initiatives to Improve Operations Related to the Claims Payment Administrative System
1. Enhance Information to Customers on Claims for Insurance and Other Payments
| Content | Implementation | |
|---|---|---|
| Enhance Information on Claims at the Time Claims Are Made | To prevent requests for payments of insurance and other claims from being inadvertently missed, the company has introduced a Claim and Benefit Request Interview Sheet to be used at the time of receipt and notification, enabling the salesperson in charge of that policy to confirm details of the situation reported by the customer. | June 2007 |
| In addition, Sony Life has implemented and begun using a system to support the process from creating the interview sheet to creating the requested documents to indicate claims for which the possibility of payment exists and the necessary requested documents from each customer's insurance policy. | July 2008 | |
| Operating procedures to sort out any other claims on which the customer can make payment requests from a medical examination certificate or other information is presented, and transmission of that information to the customer is indicated clearly. | October 2007 | |
| Other | To create an environment that ensures the process of requesting insurance and other benefit payments is less burdensome for the customer, Sony Life plans to begin assuming a fixed amount for the cost of obtaining a medical certificate in the event a non-payment decision is reached. | October 2008 (Expected start) |
2. Provide Information, Enhance After-Sale Service
| Content | Implementation | |
|---|---|---|
| Ensure Excellent Ongoing After-Sale Service | To ensure thorough after-sale service, Sony Life has revised its system. Changes include paying policy maintenance commissions to salespeople throughout the premium payment period, and clarifying the policy handover process when a salesperson resigns. | April 2007 |
| Enhance Research into Payment Operations | To ensure that customers can make claims correctly, as one part of solicitation education, specific training is provided to cover specific responses for the period from signing a new policy through to payment. To this end, Sony Life is reviewing the content of its induction, compliance and management training to implement this additional training. | June 2007 |
| Using its in-house video conferencing system, Sony Life has introduced Claims & Benefits Division Television Training at all sales outlets to ensure that salespeople understand the structure of life insurance products and are fully cognizant of reasons for payment, as well as to learn to understand the customer's situation accurately. Claims & Benefits Division Television Training content has been made open, so that it can be accessed at any time. | June 2007 | |
| Enhance After-Sale Service | Once a year, generally around October, Sony Life sends customers a Notice Concerning Protection. The timing for sending this document is to be changed so that the document is posted several months prior to the policyholder's birthday, providing an opportunity for companywide effort toward after-sale service. | April 2009 (Expected start) |
| Enhance Information Provided to Customers | To help customers better understand requests for insurance or other benefit payments, as well as these payments, Sony Life has prepared a guidebook entitled Guidebook on the Payment of Insurance and Other Claims when the Unexpected Occurs. This information is also included on Sony Life's website (Japanese only). | June 2007 |
| To ensure that customers fully understand important matters concerning procedures on the payment of insurance and other claims, the designated claims system and other items at the time they enter into a policy, Sony Life has added this information to the Explanation of Important Matters (Cautionary Information) and explains such information to customers. | August 2007 | |
| Sony Life has revised the document it hands to customers entitled About Your Policy: Terms and Conditions to make it easier to understand, using simpler expressions. | April 2008 | |
| To help customers confirm whether the payments that they seek may or may not be made, Sony Life has enclosed a checklist for customers to fill out themselves when sending the Notice Concerning Protection. | October 2007 | |
| Sony Life began disclosing on its website (Japanese only) information concerning the status of claims and benefit payments and the sample cases in which the payment was not made. This information is updated quarterly. Concerning the number of complaints reported by customers, the company indicates the number of complaints as well as sample complaints and information on what is being done to solve the situation. | August 2007 |
3. Enhance Business Processes for Making Insurance and Other Payments
| Content | Implementation | |
|---|---|---|
| Achieve Highly Accurate Payment Management Operations | To prevent inadvertent non-payment of insurance and other payments, as well as lapses in presenting information, when accumulating assessment criteria by accumulating points of caution during assessment, Sony Life has prepared operations manuals and other materials and reviewed business procedures. | Regular Implementation from July 2007 |
| From the standpoint of preventing inadvertent non-payment of insurance and other claims, after concluding that a payment of insurance or other benefits is to be made, Sony Life has created a Payment Checklist and incorporated into the workflow a recheck against inadvertent nonpayment. In line with the current investigation results, the company has revised this checklist, as well as the accompanying workflow. | January 2008 | |
| The accuracy of inputting information provided by customers, such as claim request and medical examination certificates, has been substantially improved. At the same time, large-scale revisions have been made to the insurance payment management system to ensure a working environment in which assessors of insurance and other payments can concentrate on these activities. | April 2008 | |
| Following the above-mentioned developments, large-scale system development has commenced with the aim of enhancing the information provided to customers at the time of payment and raising the efficiency of assessment activities. | Expected Completion in 2010 | |
| Enhance the Payment Management System | To strengthen the payment management system, the organizational structure has been streamlined gradually, and four departments have been created within the Claims & Benefits Division: the Payment Assessment Department, the Payment Deliberation Department, the Payment Management Department and the Payment Operations Department. Accordingly, the number of personnel in the Claims & Benefits Division has been increased substantially. | Regular Implementation from April 2006 |
| The Insurance Assessment Deliberation Department has been created within the Compliance Division to strengthen checks on the appropriateness of insurance non-payment decisions. | March 2007 | |
| To ensure the appropriateness of insurance payment assessments, Sony Life has formed the Insurance Payment Deliberation Council, composed of outside experts, to serve as a deliberation and advisory institution, and this council has commenced deliberations. | May 2007 | |
| Reflect on Products for Sale | To forge stronger links between related divisions when developing products, Sony Life has established the Product Development Committee and formulated Product Development Regulations. In addition to clarifying each department's role, the Product Development Committee establishes and deliberates on inadvertent non-payment and inadvertent lack of guidance during development of each product. | December 2006 |
4. Enhance Management Supervision and Internal Inspection Systems
| Content | Implementation | |
|---|---|---|
| Enhance the Management Supervision System | To enhance the management team's grasp of the status of the claims payment administrative system, at each monthly Executive Management Board meeting a report is delivered on the payment status of claims that have been determined to be outside the scope of payment, as well as on the status of insurance payments, and the board confirms the content of this report. | May 2007 |
| To improve its operations, the Company has established a "Claims special project for the introduction of countermeasures to strengthen its management structure relating to the payment of insurance and other claims" which reports directly to Sony Life's President and Representative Director. The status of this project is reported regularly to the Executive Management Board, and the management team assumes responsibility for confirming these measures. | April 2007 | |
| Enhance the Internal Inspection System | With regard to the internal inspection system, the internal Inspections Division has been strengthened through such measures as substantially increasing the number of personnel. In FY2007, top priority has been placed on internal inspections of the claims management system. | March 2008 |
Note: This is an English-language summary of a Japanese announcement made by Sony Life on August 13, 2008. The summary was prepared by Sony Financial Holdings Inc. solely for the convenience of non-Japanese readers.
