Mclarens Toplis' London area controller has attacked the cost-slashing mentality that dominates loss adjusting today.
Writing in a personal capacity in Insurance Times this week, Tom Heward said the culture that management consultants are imposing at the major insurers is short-termist and self-defeating.
Heward's comments (pages 20-21) respond to an article in Insurance Times last month by the consultants QBA.
In it, QBA claimed the change programme it instituted at CGU has resulted in improved service levels and cost savings to the insurer of over 35%.
The article quoted Bev Fitzgerald, former president of the Chartered Institute of Loss Adjusters and a partner in the CGU change process, as saying: "We have broken from traditional sleepy arrangements and brought a new commercial dimension to our business."
Heward, whose firm recently left the CGU panel, said: "The constant attack on fees is counter-productive. Initially a fee-slashing exercise saves expenditure, but very quickly the negative aspects of the arrangements start to show."
Urging a longer-term perspective that focuses on reducing claim payouts rather than purely on adjusters' fees, Heward said: "For those popping the champagne bottles at their new deal via QBA, enjoy it while you can as the whole concept of 'chop the fees' is doomed to failure. I predict that the overall claims spend for those who adopt this approach will inevitably rise as standards and service decline."