By Ray Birch
SAN ANTONIO—“Skyrocketing” demand for involuntary unemployment insurance coverage during 2020 has led to SWBC making significant changes to its claims processes for the coverage it provides credit unions, the company said.
Joan Cleveland, president and CEO of SWBC Life Insurance Co., spoke with CUToday.info about how the company—like many other businesses—has had to pivot during the pandemic and adjust its policies and procedures regarding this type of insurance.
Cleveland explained that when the pandemic initially struck the U.S. in March, SWBC had to reevaluate how involuntary unemployment insurance claims were processed, considering how policyholders’ lives were dramatically impacted.
“When everything shut down at first, that was pretty scary for everybody,” said Cleveland. “From our credit union clients’ perspective, making new loans took a backseat for a little bit.”
Moving into the front seat, explained Cleveland, were claims from credit union members who were suddenly out of work and unable to make their loan payments. Cleveland said SWBC realized it needed to make some swift changes to its involuntary unemployment insurance claims processes to allow members to receive their benefits as soon as possible.
“People were coming into their credit union saying they lost their jobs. These were unprecedented times,” Cleveland said. “We had to reevaluate how claims were processed.”
What Borrowers Must Do
What is required for an involuntary unemployment insurance claim to be filled, explained Cleveland, is individuals must register with their state for unemployment benefits and, once approved by the state, they also have to prove they were actively seeking work.
“That is the case because involuntary unemployment insurance is tied to state unemployment benefits,” Cleveland said. “When the pandemic started we said, ‘Let's forget that actively seeking work requirement and let's also forget receiving the state unemployment benefits,’ because that would really push the individual out for a while before they could receive a benefit from us, such as having their loan payment made.”
Cleveland said SWBC made a decision to make that first monthly benefit payment for the member to the lender.
“We thought that was very important to do,” said Cleveland. “We said, ‘Let’s make sure that we can get that loan payment made for the borrower as soon as possible.’ That was the same approach we took for disability claims. All members had to do was present a positive COVID-19 test and we would use that as proof of disability. We waived the doctors’ forms to be completed, particularly since individuals were going through a tough time getting in contact with their physicians. We just said we understand you got a positive COVID test and we started making the disability payment. We just tried to make it as easy as possible for the borrower, because we knew they were scared and shocked—pretty much like the rest of the country.”
Joan H. Cleveland
Requirements Waived
SWBC also waived formal requirements and information submission to SWBC for the claim.
“We said, ‘Just get the paperwork to us any way that works for you’,” Cleveland said. “If they wanted to fax something, email, take a picture with their phone and text…Whatever worked for them to get us the proof we needed. We pretty much waived all the requirements there.”
Involuntary unemployment claims have skyrocketed with the pandemic, said Cleveland.
“Before the pandemic these claims were in the single-digit range at any point of time at SWBC,” Cleveland said, adding the company is now using robotic process automation (RPA) to assist with the heavy demand. “We would literally just have a handful of these claims going. Now we're easily up to about 500 on any given day. The percentage increase has really been astronomical. The same holds true for disability claims.”