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⏱️ '''Claims turnaround time''' measures the elapsed duration between a [[Definition:Claim | claim's]] submission — typically at [[Definition:First notice of loss (FNOL) | first notice of loss]] — and its final [[Definition:Claims resolution | resolution]], whether by payment, denial, or [[Definition:Settlement | settlement]]. In the insurance industry, this metric serves as one of the most closely watched operational [[Definition:Key performance indicator (KPI) | key performance indicators]], reflecting the efficiency of an insurer's [[Definition:Claims management | claims handling]] machinery and directly shaping the [[Definition:Policyholder | policyholder]] experience. While the exact definition can vary — some carriers measure from FNOL to first payment, others from FNOL to file closure — the underlying intent is consistent: quantifying how quickly the promise embedded in the [[Definition:Insurance policy | policy]] is fulfilled.

📐 Carriers typically segment turnaround time by [[Definition:Line of business | line of business]], claim complexity, and geography because averages across an entire book can obscure meaningful operational differences. A straightforward [[Definition:Motor insurance | motor]] glass claim in a mature European market might close in days, whereas a complex [[Definition:Professional liability insurance | professional liability]] or [[Definition:Reinsurance | reinsurance]] claim can remain open for years. Within the measurement itself, insurers often track sub-cycle times — such as time to first contact, time to assign an [[Definition:Claims adjuster | adjuster]], time to complete investigation, and time to issue payment — to pinpoint exactly where delays occur. Regulatory frameworks in several jurisdictions impose explicit handling-time requirements: U.S. state departments of insurance frequently mandate acknowledgment within a fixed number of days, and regulators in markets like Singapore and Hong Kong monitor turnaround metrics as part of their conduct-of-business supervision. [[Definition:Insurtech | Insurtech]] entrants have made speed a competitive differentiator, with some platforms leveraging [[Definition:Straight-through processing (STP) | straight-through processing]] and [[Definition:Artificial intelligence (AI) | AI]]-driven triage to resolve simple claims within minutes.

💡 Lengthy turnaround times carry costs that extend well beyond customer dissatisfaction. Every additional day a claim sits open inflates [[Definition:Loss reserve | loss reserves]] and ties up capital that could otherwise be deployed for [[Definition:Underwriting | underwriting]] or investment. Slow handling also increases the risk of [[Definition:Claims leakage | claims leakage]] — the phenomenon where costs creep upward the longer a file remains active due to additional legal fees, [[Definition:Loss adjustment expense (LAE) | adjustment expenses]], or claimant frustration-driven litigation. From a competitive standpoint, turnaround time has become a decisive factor in [[Definition:Customer retention | policyholder retention]] and [[Definition:Net promoter score (NPS) | Net Promoter Score]] performance, particularly in personal lines where consumers can easily switch carriers. Reinsurers, too, pay attention to cedent turnaround metrics because faster primary resolution accelerates [[Definition:Reinsurance recovery | recovery]] flows and reduces uncertainty in their own [[Definition:Reserve | reserving]] estimates.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Claims management]]
* [[Definition:First notice of loss (FNOL)]]
* [[Definition:Straight-through processing (STP)]]
* [[Definition:Claims leakage]]
* [[Definition:Loss adjustment expense (LAE)]]
* [[Definition:Key performance indicator (KPI)]]
{{Div col end}}

Definition:Claims turnaround time - Revision history

PlumBot: Bot: Creating new article from JSON