For many products across a vast number of industries, companies must offer warranties to remain competitive. While much time and energy go into the development of new products, far less is spent on how the warranties - and inevitable warranty claims - will be managed. To handle warranty-writing, claims processing, and reporting, KCIC recommends a customized and web-enabled Warranty Management Solution.

What We Usually Find – A Warranty System That “gets the job done…for the most part”

We have seen it before: a company uses a warranty management system that ‘gets the job done… for the most part”. Developers may have created the program over the course of many years as needs arose. From all outward appearances, the warranty management system is functional and an ‘if it ain’t broke, don’t fix it’ mentality has been the mindset for years. However, what we’ve seen with many companies is that if you look beneath the surface, there are a multitude of issues. For instance, depending on the request, reporting may come from a variety of different Excel spreadsheets maintained by a variety of people in a variety of locations. Not having the information maintained in a consistent manner and all in one place leads to reporting inconsistencies and irregularities. Further, claim review and resolution functions are often manual and clunky and the overall process is inefficient – unnecessarily costing the company time and money.

In situations such as this, management is frequently frustrated with the inability to get accurate reports and is concerned with the frequency of complaints from customers about slow claim resolution. So, warranty managers canvass the landscape looking for an off the shelf solution, but nothing really fits and it becomes clear that it makes the most sense to build a customized solution from the ground up. The system must align with the following goals:

• A streamlined approach to warranty writing that allows for some flexibility but also has the necessary controls to maintain some consistency and order;
• Efficient claims processing, resolution and payment;
• Powerful reporting that gives accurate insights to enable decision-making.

The Customized Warranty Management Solution

To ensure that each goal is met, we suggest a complete application for warranty and claims handling built to fit the specific requirements of a company’s warranty program. An optimal solution has two data-gathering modules, one for warranty-writing and one for claims handling, that feed directly into a centralized database from which real-time reports can be generated.

The Warranty Writing Module

Sometimes a seemingly endless number of warranties are created, each to a specific customer’s needs. Such a large number of customized warranties makes claims handling and reporting very difficult. A streamlined portal with warranty-writing rules allows for pre-determined variations of warranties that meet customer needs but also keeps control over the number and types of warranties issued.  It also allows the warranty claims adjuster to easily refer back to the coverage that was afforded with the warranty.

KCIC’s warranty writing module is a web application that generates a warranty once a sale is finalized. A company representative logs into the application and creates the warranty using a programmed set of guidelines and rules, as defined by the company (for example, certain warranty types and durations are available only for certain products sold in certain locations).  A warranty is then systematically created. The application inserts warranty and customer data directly into a centralized database and is that data is immediately available for real-time reporting.

The Claims Processing Module

KCIC’s claims processing module manages the entirety of a claim’s lifecycle, from claim submission, to claim review, to claim adjudication. For claim submission, a warranty holder simply navigates to a website, inputs identifying warranty and specific claim information and submits the claim for review.

Funneling claim submission information through a web portal structures the data making it more easily reportable.  It can increase review efficiency because the automated checks can remove certain ineligible claims or move other types of claims to resolution without human interaction, saving the company time and money.

After a claim is submitted and automated checks are completed, a claim processor logs into the claim review portal, reviews the remaining claims against pre-defined criteria and finds each claim to be eligible or ineligible for issue remediation. An eligible claim can then automatically proceed to issue remediation based upon a pre-determined process flow. A streamlined and systematic approach to claim review has similar reporting benefits as explained above and reduces subjectivity during claim review, as all claim review takes place based upon the established pre-determined criteria and is enforced by the structure of the claim review portal.

Real-time Reporting

Whether decision makers are maintaining the status quo or course correcting, they must be empowered with the data required to make business decisions. Dashboard reporting technology, that is, instantly accessible and web-enabled charts and graphs, can be used to display useful metrics to ensure alignment with the company’s goals. The dashboard may include things like: warranty costs as a percentage of sales, claim frequency by product, or warranty costs per unit sold.

Further, dashboards can be interactive. Managers are often frustrated with static monthly reporting – what they truly want is the ability to access metrics in real time and the ability to interact with the reports. For instance, a dashboard can incorporate threshold acceptance ranges, where an issue is visually highlighted if a metric is out of a pre-defined acceptance range. If the rate of claims made per product sold for a given timeframe is over a predefined range, management can be alerted visually. Dashboards also allow a user to ‘drill down’ into the data to ascertain even more specific insights that are driving trends.

Whether the goal is gaining efficiencies, increasing customer satisfaction, understanding the warranty program’s profitability, or all of the above, managers want immediate insight into the data.

Wrapping Up: A Single Application for Warranty Writing, Claims Processing, and Reporting

A thoughtfully built customized warranty solution can meet every goal of a warranty program – something that off the shelf programs simply cannot do. A customized solution built in accordance with a company’s unique process flow, can improve a customer’s experience, create efficiencies in the review and claim adjudication processes, and help a company better understand the cost of  their warranty program.