Digital Platforms

The Contracts Update section includes announcements of contracts insurance information technology companies have signed with customers in recent weeks. Contract news can be faxed to Insurance Networking magazine at (312) 913-1366 or by electronic mail to Stephen.Dwyer thomsonmedia.com AgencyPort Insurance Services Inc.

Only five short years ago, insurers were scrambling to get their IT systems ready for Y2K. This year, they're at the cusp of implementing enterprise solutions that leverage component-based software across the organization, saving them significantly in both IT development and maintenance costs."Before 2000, I conducted approximately 100 Y2K risk assessments in the industry," says Deborah Smallwood, insurance practice leader at TowerGroup Inc., Needham, Mass. "The common themes were: What is your vision? What is your strategy? Do you have your arms around your portfolio? And they all failed. In the course of five years, insurers have come a long way."

When it considered the various ways to comply with the security rule included within the Health Insurance Portability and Accountability Act (HIPAA), Chattanooga, Tenn.-based BlueCross BlueShield of Tennessee identified its "incident response" capabilities as a viable compliance strategy.More specifically, the Tennessee Blues plan formed an incident response team (IRT) to respond to information systems incidents that could potentially compromise the security of personal or protected health information of its customers. The Blues plan can now better respond to information systems incidents as a cohesive team and minimize impact of incidents on its business and customers, says a security analyst at the company.

Providence Washington Insurance Cos., Providence, R.I., will cease underwriting new and renewal business, to the extent permitted by law. In addition, the company has entered into an agreement with OneBeacon Insurance Co., Boston, whereby OneBeacon will acquire renewal rights in Providence Washington's small business package policies. Providence Washington plans to continue servicing its existing portfolio of commercial and personal lines business. The company reported statutory net losses of $7 million in 2002 and $35 million in 2003. It reported a net loss of $7 million in the quarter ended March 31, 2004. These losses contributed to the policyholders' surplus dropping from $92 million at year-end 2002 to $59 million at year-end 2003, and to $53 million as of the quarter ending March 31, 2004.

eAutoclaims Inc., an Oldsmar, Calif.-based claims management services company, has executed the final closing of approximately $2.5 million in new financing. Of the $2.5 million, $2.25 million was a sale of equity to multiple investors at $0.28 per share and $250,000 was an 8% convertible debenture from one of the company's directors.Both the equity and convertible debentures include warrant coverage. This represents additional capital of $900,000 from the company's previous announcement on May 5, 2004. Noble International Investments acted as placement agent on a material portion of this raise and will continue to advise the Company as its investment banker.

BOSTON--John Hancock today introduced a new, highly competitive variable universal life policy for small- to mid-sized businesses, called Performance Executive Variable Life (VL). The product focuses on high early cash values and offers strong cash value accumulation. It has an outstanding selection of investment options, and benefits and features that are among the most comprehensive in the industry.

HARTFORD, Conn. -- The process of proofreading 17-digit automobile VIN numbers or lists of property coverages can consume as much unproductive time for an insurance agency as recording account information with a quill pen. New tools are needed to match the insurance business with the competitive needs of a new century. Thanks to one major insurance company, agencies will soon find they have more time to devote to managing customer relationships, time which used to be spent knee-deep in paperwork.

LAS VEGAS, NV--The 12th Annual ACORD Awards ceremony recognizing achievements in ACORD data standards implementations was held at a special luncheon during the ACORD LOMA Insurance Systems Forum in Las Vegas. Beginning with a welcome from ACORD President and CEO Gregory A. Maciag and remarks from ACORD Board Chairman David Findley, Senior Vice President, Commercial Lines/Personal Lines, St. Paul Travelers, the ceremony honored those who excelled at implementing ACORD data standards over the past year.

CHICAGO--Aon Corporation and Computer Sciences Corporation have agreed to negotiate the outsourcing of the majority of Aon's U.S. information technology (IT) infrastructure. The transition to CSC would begin in fall 2004, subject to completing a final contract.

OVERLAND PARK, Kan.-- Sprint announced plans today to launch Sprint Mobile Claims Adjustor, a mobile solution that will allow insurance claims adjustors to process claims on-site using wireless handheld devices.

LAS VEGAS, NEVADA -Sun Microsystems, a leading provider of industrial-strength hardware, software and services, and Brixlogic, a provider of industry-standard Web Services solutions for the financial services industry, today announced that the two companies are partnering to deliver the first integrated solutions for the ACORD messaging standards.

SAN FRANCISCO--Quality Planning Corporation (QPC), the Rating Integrity Solutions Company, today released its annual Premium Rating Error report. The report concludes that premium rating errors lower the overall profits of auto insurance companies. QPC estimates that $15.2 billion of premium revenues were foregone in 2003 due to inaccuracies in rating information. The report can be found online at: http://www.qualityplanning.com/research.html.

BLOOMFIELD, Conn.-- CIGNA HealthCare and WebMD Health today announced a multi-year agreement that will offer help to millions of CIGNA HealthCare members in making vital health care decisions and in understanding and using their health care plan. Under the agreement, CIGNA will integrate WebMD Health's comprehensive suite of online health information and decision support tools into myCIGNA.com, the personal health benefits Web portal for CIGNA HealthCare members.

Uniondale, NY--OnlineBenefits Inc., provider of Internet-based HR solutions, announced that it has signed a Letter of Intent to acquire Captiva Systems, a producer of agency management software for group insurance brokers.

Atlanta--Jacada Ltd., a provider of solutions that accelerate business improvement, today announced Jacada Fusion, a first-to-market solution that delivers The Perfect Interaction between people, process, and information.

NEWARK, Calif.-- Risk Management Solutions (RMS), the world's leading provider of products and services for the management of catastrophe risk, today announced that it has released a new data formatting tool called the RMS Data Wizard. The tool is designed to help clean up and convert data about insured locations into a common format for use by insurance buyers, agents, brokers, insurers, and reinsurers.

NEW YORK--AIG Technologies, Inc. (AIGT), a member company of American International Group, Inc. (AIG), today announced the launch of WINS Now, a Web-based insurance processing system designed to streamline policy administration and increase speed to market for Managing General Agents (MGA) and small property-casualty companies, including start-up and virtual insurers.

ProMutual Group, A Boston-based provider of medical malpractice insurance in the Northeast, has introduced a new Web site for policyholders. All policyholders will be receiving a letter within the next week announcing the site and providing each of them with their own individual username and password.This site is designed to be a source of medical malpractice and company information. A key feature of the site is the ability to link to online continuing medical education (CME) programs developed by ProMutual Group and offered in conjunction with the Massachusetts Medical Society. ProMutual Group-insured physicians can receive CME credit by taking an online test at the same discounted rate offered to Massachusetts Medical Society members.

NORTH RICHLAND HILLS, Texas--UICI today announced that, without acknowledging any fault, liability or wrongdoing of any kind and subject to satisfaction of certain conditions, it has agreed to settle a substantial number of its pending "association group" lawsuits.

SPRINGFIELD, Mass.-- MassMutual Retirement Services unveiled new aged-based asset allocation options that allow defined contribution (401k) plan participants to select an automatically-adjusting investment strategy based on their anticipated retirement date.

The Agents Council for Technology (ACT), which is affiliated with Alexandria, Va.-based Independent Agents & Brokers of America, has published Guidelines for Effective Agent-Carrier Technology Agreements, a report that can help independent agents and brokers as well as carriers identify issues to address in technology agreements.These agency-carrier technology agreements supplement agency agreements by detailing electronic interaction expectations between agents and their insurance company partners.

COLUMBIA, S.C.-- Following health insurance scams that have hit South Carolina recently, BlueCross BlueShield of South Carolina has added new tools for consumers to use to report fraud.

Jeff Post (44) has resigned as CEO and president of the U.S. Allianz subsidiary Fireman's Fund Insurance Co. (FFIC) for personal reasons and will leave the company at his own request. He will be succeeded by Fireman's Fund board member Charles (Chuck) Kavitsky (52), who will step down from his current position as president of Allianz Life, effective immediately.Novato, Calif.-based Fireman's Fund and Allianz Life are wholly owned subsidiaries of the Allianz Group. Jeff Post joined Fireman's Fund in May 1994 as chief actuary and was appointed chief financial officer in January 1996. In January 2001, he became CEO.

Standard Insurance Co., a subsidiary of StanCorp Financial Group Inc., Portland, Ore., has launched enhancements to its AdminEASE plan administration tools to enable its clients to manage more aspects of their insurance plans online.Employers can now initiate claims and analyze claims experience as well as check the status of insurance applications that require medical underwriting. The AdminEASE plan administration tools are available to The Standard's group disability, life and dental insurance customers at no additional charge.

Fiserv Inc. has created a new organizational structure--and a new name--as part of its strategy to provide a comprehensive information technology offering to the insurance industry.

IT spending continues to inch upward, according to Forrester Research Inc. A recent survey by the Cambridge, Mass.-based research and consulting firm found CIOs' rising optimism about their business climate will translate into a 2.4% spending increase in 2004, up from the 1.7% originally projected six months ago.The survey of more than 870 IT decision-makers at large North American companies also showed that business services, such as consulting, transportation, and construction, and finance and insurance firms lead other industries in year-over-year IT spending increases, with a rise in 2004 budgets of roughly four percentage points.

COLUMBIA, S.C.-- Insurance Services Office Inc. (ISO) has launched the new Microsoft .Net-ready version of its ISO Claims Outcome Advisor (COA) personal injury claims management solution. COA Release 3.1 offers major new features, including the Treatment Protocols function and enhancements to the COA Medical Library and Settlement Analyzer tool. This will enable claims handlers, managers and third parties across the entire enterprise to manage information about personal injury claims via a secure Web browser, thereby speeding up claims resolution, improving accuracy and ensuring best practices.

FARMINGTON, Conn.--Insurix, Inc., a provider of Web-based insurance sales and administration platforms, announced today that Harvard Pilgrim Health Care has successfully completed the launch of "Easy Online Renewal" for brokers. The Insurix-based system allows Harvard Pilgrim sales account executives, underwriters and third party brokers to instantly access and manage small-group renewals from inception through renewal presentation to case acceptance. With the Insurix platform, users can monitor and act upon all key events in the renewal process, resulting in improved retention rates and better customer service.

COLUMBUS, Ohio-- Ringing cell phones are a welcome sound to Nationwide, so long as the company's longtime jingle is playing. Nationwide is one of the first companies in the U.S. to offer an advertising jingle as a ring tone. Trendwatchers have dubbed the phenomena "jingle casting."

Rapidly submitting a timely First Notice of Loss (FNOL) report for a commercial auto or property insurance claim leads to faster settlements and satisfied claimants. The Hartford Financial Services Group, Hartford, Conn., now enables its independent insurance agents to electronically initiate the claim process for their clients.The Hartford, which boasts a strong record of deploying advanced technology for improved agency interaction, is now enabling independent agents to electronically submit a commercial auto or property FNOL, with attachments, from their Applied agency management system. It does this using IVANS Transformation Station, a managed data exchange using Web services and ACORD XML for real-time transactions between agency and carrier systems.

Data standards are critical to streamlining the financial reporting process, according to industry sources. And a new add-in to Microsoft Office 2003--to be released this summer by the Redmond, Wash.-based software giant--may be the missing link in the concept of "straight-through reporting."The Microsoft add-in will provide XBRL support within Word and Excel, and it will enable companies to automate manual tasks associated with using Word and Excel for financial reporting, says Mike Willis, founding chairman of XBRL International and partner at New York-based PricewaterhouseCoopers.

Blue Cross of California, Thousand Oaks, Calif., has expanded its physicians technology initiative to include 1,040 safety net physicians in California. Traditionally, safety net physicians provide care to the uninsured, poor and low-income patients, including those enrolled in the Medi-Cal and Healthy Families insurance programs.With an additional $2 million in funding, this technology initiative will help these physicians improve patient care, achieve greater efficiency and improve administrative functions. These new technologies are intended to provide greater access to information and data exchange via the Internet or wireless handheld devices.

Rating agency demands (71%), financial reporting issues (55%), shifting product preferences (55%) and changes in regulatory requirements (48%) are driving the industry's need for improved risk and capital management practices, according to life insurance company CFOs surveyed by the Tillinghast business of New York-based Towers Perrin in its latest CFO survey.As a result of such pressures, 86% of the CFOs surveyed say they are paying more attention to risk and capital management practices. Four out of five (81%) of the executives polled are going one step further; they are proactively implementing them.

For years, life insurance providers and their agents have relied on obtuse, text-heavy sales presentations to their individual customers. Too often, though, poor sales presentation tools fail to enlighten individuals concerning the magnitude of a life purchase.

WASHINGTON-- Millions of Americans buying health insurance on their own have a wide variety of products from which to choose, and most select plans very similar to the coverage available to working people in employer-sponsored groups.

It's no secret that for insurers, aligning technology staffs and business units into a full partnership has been challenging. Frederick Matteson, the newly appointed chief information officer for Novato, Calif.-based Fireman's Fund Insurance Co., isn't able to fully grasp the automation-related woes that have bedeviled insurers. That's because Matteson has deftly been able to avoid them himself.Having spent a number of years as an executive in the brokerage industry, Matteson championed the concept of total alignment between IT and business long before it became commonplace. A proponent of disciplined strategic scenario planning, Matteson has a keen sense of determining early on whether to expand or reduce a corporatewide initiative, including those centered on information technology.

In a legal battle stemming from actions Allstate Insurance Co. took in 1999 to launch its groundbreaking multi-channel sales strategy, a federal judge has absolved the company of age discrimination. But Allstate is not off the hook yet.The judge's ruling also has cleared the way for terminated Allstate agents to sue the Northbrook, Ill.-based carrier under class-action status for other charges, including breach of contract, breach of fiduciary duties and violation of other federal laws, including the Employee Retirement Income Security Act (ERISA).

When it comes to inefficiencies surrounding information technology security practices, global corporations are discovering that to err is human.A survey conducted by Oakbrook Terrace, Ill.-based global trade association Computing Technology Industry Association (CompTIA) discovered that human error-defined mainly as a lack of adequate certification and training-is the root cause of lax IT security at most corporations.

The number of career agents-the largest distribution channel for life insurance-dropped significantly in a decade, down from 238,000 in 1990 to 178,000 in 2000. In addition, by 2010, 13.2% of the U.S. population will be 65 or older.These demographics present life insurers with product, distribution and operational challenges as fewer agents are available to sell new-sometimes complex-products to consumers who are planning for their retirement years.

Many corporations are catching flak these days for various operational inconsistencies.For instance, a recent survey indicates that companies, including insurers, have implemented seemingly effective, written IT security policies, but have not optimized these efforts by providing proper training and certification to its people.

Compromise legislation establishing a federal role in insurance regulation is likely to emerge from the House Financial Services Committee early in May. A hearing in late March yielded strong support for the measure from an industry divided on the issue.At the same time, the principles involved constitute the strongest support yet for greater uniformity in insurance regulation.

The Contracts Update section includes announcements of contracts insurance information technology companies have signed with customers in recent weeks. Contract news can be faxed to Insurance Networking magazine at (312) 913-1366 or by electronic mail to Stephen.Dwyer thomsonmedia.com Computer Sciences Corp.

ST. PAUL, Minn. -- Through aggressive health care fraud investigations and coordination among other states' Blue Cross plans, the Blue Cross Special Investigations Unit (SIU) stopped payment on $8.7 million of suspect claims last year, reducing the impact of fraud on premiums in Minnesota.

MADISON, Wis. -- BlueCross BlueShield of South Carolina, a leading health insurance provider that also administers federal health insurance programs, has addressed its evolving document communication needs by designating two Esker Software solutions as enterprise standards. Esker DeliveryWare Platform and Esker Fax respectively provide BlueCross BlueShield with intelligent multi-channel e-document delivery and automated fax.

Nationwide Financial, Columbus, Ohio, is offering an online marketing tool to help investment professionals grow their businesses and support the long-term investment needs of their clients. Investment Selector is an online quarterly report that recommends investment options and percentage allocations for The BEST of AMERICA variable products. Investment Selector uses research and evaluation methods developed by Morningstar Associates LLC, a registered investment advisor and a wholly owned subsidiary of Morningstar Inc. Investment Selector targets the investments that fulfill five allocation models developed through a collaboration with Ibbotson Associates.

The majority of insurance companies already maintain a rigorous corporate governance model to protect the financial interests of their policyholders and shareholders. So why does the Sarbanes-Oxley act have the industry aflutter? New research from TowerGroup, a Needham, Mass.-based research and consulting firm, finds insurers are realizing that the law can serve as a catalyst for long- term financial systems architecture strategy and process improvements."The globalization of insurance and the current complex regulatory environment necessitate a systematic, integrated approach to risk management," says Cindy Saccocia, senior analyst in the Insurance practice at TowerGroup and author of the report, titled "Sarbanes-Oxley and Insurance: Requirements, Hype, and Opportunity."

Atlanta-based Blue Cross and Blue Shield of Georgia has launched the Clear Claim Connection, an online product and service for its network providers. This product, created by McKesson Corp., enables BCBSGa to share with network providers the auditing rules and clinical rationale which exist in the claims billing and auditing code system used by BCBSGa.John Watts, president and chief executive officer of BCBSGa, says, "This important service will enable network physicians and their office staffs to review our payment methodology online. By providing this service, we hope to make our reimbursement policies more readily accessible and reduce misunderstandings among providers, members and BCBSGa."

Prudential Financial Inc., Newark, N.J., has introduced an automatic, online licensing application for brokers seeking appointment to sell the company’s insurance and annuity products. The electronic data collection tool, called Online Confidential Data Sheet (CDS), was developed by BISYS Education and Licensing Services for Prudential.The Online CDS streamlines the traditional, paper-based appointment process and greatly improves brokers’ speed to market.

Risk Management Solutions Inc. (RMS), a Newark, Calif.-based provider of products and services for catastrophe risk management, has released the findings of an in-depth study that provides workers compensation, life, and health insurers with key benchmarks for the potential risk of human casualties from catastrophic events.Among other findings, the study demonstrates that while many in the insurance industry view the World Trade Center attack as a worst-case event, there are numerous natural and man-made events that could cause significantly higher casualties and associated insured losses.

NEW YORK--The Guardian Life Insurance Co. of America is making an effort to demystify the financial planning process and educate visitors on the role that Guardian's products and financial representatives play in an overall financial planning strategy. The company is doing it with a new Web site, located at www.GuardianLife.com. The new site replaces Guardian's existing Web address at www.glic.com.

In recognition of the HIPAA security rule pre-anniversary deadline that passed this month, Washington, D.C.-based nonprofit URAC released a report examining the state of preparedness in the health care industry in complying with the security rule.

Columbus, Ohio-based Nationwide Financial is using Web technology to make it easier for investment professionals to manage the client review process with a new tool called the Interactive Client Review (ICR).Nationwide's ICR tool simplifies the client review process by providing one-stop, real-time access to client portfolios online. Detailed information is presented in a concise and secure format for investment professionals to access from any remote location. The ICR tool can also provide investment professionals with a quick, easy view of their clients' quarterly statements online. Through its instantly accessible electronic format, ICR aims to help investment professionals manage their clients' accounts in half the time.