Journal
Notification lag in winter motor claims, and why the committee sees it late
A claims committee in February often looks at January paid loss and concludes that winter was kinder than the weather suggested. Handlers know otherwise: the car was in the bodyshop, the hire was still running, and the first complete invoice had not arrived. The ledger is not lying. It is late.
Notification lag is the gap between the collision date the policyholder gives and the date the file becomes a claim you can count. In motor, a further gap appears between notification and the first indemnity payment. If you chart paid loss by payment month alone, December ice sits in March.
When we read a winter motor book, we ask for collision date, first notification date, and first payment date as separate fields. We then show three small charts, not one. The first is volume by collision week. The second is the same files by notification week. The third is paid amount by payment week. The committee can see the bulge move.
Handlers are not the villains in this story. A policyholder who waits for a quiet morning to call, a repairer who will not estimate until parts are seen, and a total-loss engineer booked after the holidays all stretch the dates. The briefing should say so. Blame charts that colour handlers red for lag they cannot control will be ignored, correctly.
What the room should discuss is whether the extract even holds collision date as the driver stated it, or as a default of the notification day. We have seen books where the two dates were copied from one another for a fifth of files. In that case the lag chart is a portrait of a default, not of winter.
If you are preparing a Q1 pack, freeze the extract after the last hire invoice you care about has had a chance to land, or show open hire as a separate line. Otherwise the committee will congratulate itself in February and fund a surprise in April.