Claims talent shortfall opens door for Pro Global in Germany

A stark shortage of talent in parts of the Germany insurance claims market, but especially in complex, disability-related employment claims, has opened the door to a greater acceptance of the use of third party administrators (TPAs) in the market by German-speaking regional re/insurers.

That is according to Stilianos Kalaitzidis, head of business development, Pro Global Germany, who told Baden-Baden Today that the business has enjoyed a track record of 100 percent growth in the market for the past two years. Now, it is looking to start to convince insurers that it can aid them on the underwriting side.

“German re/insurers have traditionally been cautious when it comes to outsourcing to TPAs, as many see claims handling as their core competence,” he said. “However, a shortage of experts and increase in complex claims has led to an increase in demand for trusted claims outsourcing partners, particularly when it comes to handling complex workplace disability claims.”

He said the core problem starts with a lack of talent in the sector. A mixture of the industry’s lack of appeal, Gen Z-ers seeking different types of careers and the fact that claims is a hard skillset to master has resulted in a talent drain in re/insurance generally, and in claims especially. 

“We can deal with the backlog and get things back on track.”

Another challenge is that the claims sector remains largely analogue-based, especially within smaller insurers. This makes it even more time-consuming for insurers to get through claims backlogs. 

After years of falling behind on servicing complex claims, insurers are now grasping the benefit of using a TPA. “First, they see that we can deal with the backlog and get things back on track. Second, we can save them money,” Kalaitzidis said. 

He notes that many disabilities claims in Germany can be reviewed by the insurer annually. This has not been happening for many but simply implementing it can mean cost-savings in the long term, he said.

“TPAs were typically only used in emergencies but that culture is changing,” Kalaitzidis said. “Pro is often signing multi-year agreements to support clients in various ways, depending on their needs, but the final decision on any claims is typically taken by the insurer.”

Pro Group’s next step is to move into offering services on the underwriting side. The plan was to start that process this year, but it has been too busy on the claims side and now plans to launch a pilot scheme in 2025.

Pro Global's sister company Pro MGA Global Solutions is also present at Baden-Baden.  It offers an incubator service for carriers wishing to enter the German market via MGAs, something that became more popular after the UK’s departure from the EU. Since then, Pro has helped some 20 MGA startups and the MGA team are in Baden-Baden discussing opportunities for partnerships in this space with reinsurers.

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