Digital Platforms

Westlake Village, Calif. - Policy retention is critical to the financial success of auto insurance carriers, and a customer's experience with their provider is the most important element—outweighing brand image—in generating policy renewals, according to the "J.D. Power and Associates 2007 National Auto Insurance Study."The study measures customer satisfaction with auto insurance carriers across five factors. In order of importance, they are: interaction, policy offerings, billing and payment, price and claims.

Boulder, Colo. — IT risk management is no longer strictly about mitigating the negative threats surrounding IT, a new study finds. The study was published by Boulder, Colo.-based independent IT management research and consulting firm Enterprise Management Associates (EMA).

New York – Two life insurers recently appointed a number of executives. ACE Life Insurance Co., a business of Bermuda-based ACE Ltd., named Jim Gibbs as vice president and chief underwriting officer and Bruce Horton as vice president and chief marketing officer. Gibbs joins ACE from Optimum Reinsurance Co., Dallas, where he was senior vice president, underwriting. His previous experience includes positions at SCOR Life US Re, Dallas, and Munich American Reinsurance, Atlanta. He is a past president of the Southeastern Home Office Underwriters Association, and he has been a speaker at many industry gatherings, addressing both underwriting and actuarial groups on various topics.

Chicago – A new study evaluates the home pages and usability of 14 major auto insurance providers’ Web sites to examine customer expectations and discover where companies succeed or fail in attracting and retaining customers.

Armonk, N.Y. - U.S. consumers want insurance companies to more effectively communicate new products and services available to them, provide customized policies to better meet their needs and bring their customer experience up to par with other industries, according to an IBM study of more than 3,000 P&C insurance policyholders. Yet, despite boasting one of the largest demographics of loyal and satisfied customers of any industry, few insurance companies are looking for new and innovative ways to connect with their customers to enhance their experience and drive organic growth.

Boston – Liberty Mutual Group has made its acquisition of Ohio Casualty Corp. official. Liberty first announced its intention to purchase the Fairfield, Ohio-based carrier for $44 per share in cash in May.

Washington – The heads of two insurance industry associations have issued a joint letter urging the National Governor’s Association to drop their opposition to the National Insurance Act.

Silver Spring, Md. – AIIM, the Enterprise Content Management Association, is expanding its certificate training program to include two new programs for business process management and information organization and access. The new programs are designed to provide organizations with the skills and knowledge to improve their business processes and optimize enterprise search and findability. Online courses will be available starting September 10 by going to www.aiim.org/training. More than 4,200 participants attended the Silver Spring, Md., organization’s first two certificate programs—on electronic records and enterprise content management, reports John Mancini, AIIM president. “This led us to look at related certificate programs that would help end-users make smart information management decisions," he said. Each AIIM certificate training program consists of three designation levels (practitioner, specialist and master level) across four programs (enterprise content management, electronic records management, business process management and information organization and access. Source: AIIM

Stamford, Conn. – A rapidly shifting, increasingly consumer-centric insurance market is no safe harbor for health insurers, a new research note from Gartner, Inc. contends.

Stamford, Conn. – Nearly 90% of CFOs believe that the cost of compliance with Sarbanes-Oxley (SOX) outweighs the benefits, according to the latest survey from the Tillinghast business of Towers Perrin.

Novato, Calif. and Armonk, N.Y. – Allianz of America (AZOA), parent company of Allianz Life Insurance Company of North America, has signed a $330 million-, 7-1/2-year outsourcing agreement with IBM to handle information technology (IT) operations of the life insurer.

Pearl River, N.Y. – ACORD has released the first three of its standardized producer appointment forms.

Washington—Eight more insurance companies have signed on as sponsors of the National Association of Professional Insurance Agents’ (PIA) agent branding program, Local Agents Serving Main Street America.

Washington, D.C.– The National Association of Mutual Insurance Companies (NAMIC) pointed to a new government report showing a direct correlation between credit scoring and risk. A study released by the Federal Reserve Board comes on the heels of a report by the Federal Trade Commission (FTC) that also said credit scoring is not unfairly discriminatory.

Silver Spring, Md. — Insurers are recognizing the savings associated with installing distributed scanning and capture technologies, according to a July 2007 survey by AIIM, who specializes in disseminating information about enterprise content management.

New York — The need to comply with Section 404 of the Sarbanes-Oxley Act (SOX) is only having a minimal effect on enterprise risk management (ERM), new research has found.

New York - A subsidiary of New York-based American International Group, Inc. (AIG) has entered into an agreement to acquire Wurttembergische und Badische Versicherungs-AG (Wuba), its major subsidiary DARAG Deutsche Versicherungs- und Ruckversicherungs-AG (DARAG) and other minor subsidiaries from entities associated with J.C. Flowers & Co. LLC. Subject to regulatory approval from insurance and cartel authorities, the transaction is expected to close later this year. Terms of the agreement have not been disclosed. "We are pleased to have reached an agreement to acquire Wuba and its subsidiaries," said AIG President and Chief Executive Officer Martin J. Sullivan. "The transaction both reaffirms AIG's commitment to growing in the German marketplace and greatly enhances our insurance offerings to small and medium sized companies." Based in Heilbronn, Germany, Wuba offers property and casualty, marine, personal lines, and accident & health insurance through its 2,500 broker relationships across the country. "Wuba is an experienced and highly respected German insurer with a strong brand," said Nicholas C. Walsh, Executive Vice President of Foreign General Insurance for AIG. "We plan to continue their commitment to superior customer service, broker focus, distribution management and technology." AIG serves commercial, institutional and individual customers with insurance products, with operations in more than 130 countries and jurisdictions. Source: AIG

Worchester, Mass. - The Hanover Insurance Group Inc., a regional property/casualty company based in Worchester, Mass., is offering Employee Retirement Income Security Act (ERISA) bonds through the company’s online point-of-sale system, BONDirect. The federal government’s ERISA bonds protect employee benefit plans against losses caused by fraud and dishonesty committed by employee trustees.

Toronto-based kanetix, Canada's online insurance marketplace, compared the average lowest auto insurance premium quoted at www.kanetix.ca in Q2 2007 with the average lowest premium quoted from the same period in 2006, and found that the average lowest price had decreased by almost 17%.

El Segundo, Calif. - To remain competitive in the life and annuity industry, insurers should exploit technology to create more innovative products and introduce them faster, according to insurance industry analysts speaking at Computer Sciences Corp.’s Life and Annuity Users’ Forum.

Washington- The National Association of Professional Insurance Agents (PIA) is reiterating its opposition to the National Insurance Act of 2007.

Washington— The National Association of Professional Insurance Agents (PIA) is reiterating its opposition to the National Insurance Act of 2007.

In the wake of insurers increasing their efforts to utilize the Internet to broaden their accessibility, streamline efficiency and reduce time and costs, two insurers have recently ramped up their online customer service capabilities.

Washington, D.C. - The House Financial Services Committee today passed H.R. 2761, the Terrorism Risk Insurance Revision and Extension Act of 2007 (TRIREA) by a vote of 49 to 20.

Richmond, Va. - Markel International Ltd., the company's London-based operation, will enter the Asian market with marine and professional liability products, the company reports. Markel Vice Chairman Steven Markel told INN that the push in Asia is in conjunction with its operations as a syndicate of Lloyd's of London.

Frisco, Texas – The consolidation in the vendor arena continues as Skywire Software, making its third major acquisition of the year, snapped up Canadian automation and compliance solutions provider Whitehill Technologies, Inc.

SC BLUES WINS CALL CENTER TECH AWARDBlueCross BlueShield of South Carolina, Columbia, S.C., took top honors in the "Best Use of Technology" category during the 3rd Annual Call Center Excellence Awards held recently in Las Vegas.

FEE REDUCTION FOR INSURANCE SERVICESThe Depository Trust & Clearing Corporation's (DTCC) Insurance Services New York business reports its first fee reduction in history, reflecting growing usage of its services. Insurance Services has automated linkages and data exchange between carriers and their broker/dealer, bank and other distributor partners who market insurance products.

Reinsurance firms are gripped by a series of major challenges, from increased consolidation in the industry to the rise in securitization and the greater risk primary insurers assume. Although the firms' brokers remain intent on winning clients by accentuating the personal touch, many reinsurers are aggressively adopting technology to confront the stiff obstacles they face.A principal new challenge for reinsurers is the rise in the use of securitization to support life insurance products. Both life and P&C insurance firms are turning to securitization to access capital markets, which has helped lead to a decline in recurring reinsurance since 2005, according to the recent study, "Emerging Trends in U.S. Life Reinsurance: Challenge or Opportunity," from the Hartford, Conn.-based firm Conning Research and Consulting Inc. While recurring reinsurance increased significantly from 1995 through 2000, it flattened out from 2001 until 2004, and then began declining in 2005. "To the extent that some primary insurers, initially several larger ones, use securitization as a substitute for reinsurance, it presents a threat to reinsurers," the study notes.

DIRECT-TO-CONSUMER INSURER CHOOSES RULES MANAGEMENT SYSTEMPrecedent Insurance Co., a subsidiary of American Community Mutual Insurance Co., headquartered in Livonia, Mich., chose Redwood Shores, Calif.-based Corticon Technologies' Business Rules Management System as a critical component in the development and management of Precedent's direct-to-consumer healthcare insurance solution. Precedent plans to deliver a suite of health insurance solutions called REMIX, which includes "Coverage on Demand" plans that charge the insured for only the health insurance coverage they need.

A study of European insurance policy holders by Cambridge, Mass.-based Forrester Research Inc. revealed an overarching reluctance to manage their accounts online. Given many of the major carriers’ desire to drive more customers to the Internet for routine sales and service interactions, the data points to an uphill battle.

Hartford, Conn. - The economics of distribution channels in personal auto insurance can be difficult to understand, and this can present both opportunities and challenges in a softening rate market, according to a new study by Hartford, Conn.-based Conning Research & Consulting.

Ipswich, Mass. - The Customer Respect Group, an international research and consulting firm that focuses on how corporations treat their online customers, released findings from its Third Quarter 2007 Online Customer Respect Study of the Life Insurance Industry.

New Delhi and The Hague, the Netherlands - Insurers outside the U.S. are actively creating partnerships in a business affecting the banking and insurance industries.

Philadelphia – To support high-quality patient care, Philadelphia-based Independence Blue Cross (IBC) is providing physicians with enhanced data about members with chronic conditions.

Needham, Mass. – Leaders in claims operations are beginning to break away from traditional processes and seek technology to assist them in managing a complex business process that has, to date, been extremely people intensive, according to new research from TowerGroup, Needham, Mass. Claims departments have been historically reluctant to adopt technology solutions, perceiving technology as incapable of duplicating the decision-making process of an experienced claims adjuster.

Washington, D.C. - NAVA has struck an alliance with Atlanta-based Financial Services Institute (FSI) to automate electronic annuity sales for independent broker-dealers. The alliance is the latest in a series of actions that play into NAVA's straight-through processing (STP) initiative, a comprehensive set of standards for managing new annuity business electronically. With the goal of reducing redundancies and costs, and increasing efficiencies across the industry, the STP standards, published in December 2006, address e-signatures, e-document management and regulatory acceptance, and includes built-in compliance capabilities to help prevent unsuitable sales. NAVA and the FSI, a membership association of broker-dealers that serve registered representatives who are independent contractors, will work together to augment the STP standards and enable broad adoption among FSI members. The group comprises 110 broker-dealer member firms with more than 130,000 independent registered representatives.NAVA reports that independent brokers represent a significant and fast-growing channel for the distribution of variable annuities - FSI members account for more than 36% of all annuity sales. Mike DeGeorge, NAVA's general counsel, told INN that one of the group's goals is to have broader participation from the independent channel. "FSI gives us access to a larger group of advisers," he says. "We have similar alliances with ACORD, and we've been working with the American Council of Life Insurers." DeGeorge says that NAVA already counts 19 of the top 20 insurers on its executive council, including Allianz Life, Hartford Life, Pacific Life, Principal Financial, Prudential Financial, Transamerica Life and Wachovia Securities. Major wire houses, such as UBS and Morgan Stanley, along with 10% of the bank channel, are also involved, DeGeorge adds. NAVA is also in the process of working with other trade associations as well as federal and state regulators to secure wide-spread acceptance and approval of STP."We want to let them know what we are doing and why we are moving to electronic commerce," DeGeorge says.The group is now working on implementation guides for the standards, model consent documents, and on suitability standards that provide common interpretations of regulatory requirements.This series of actions, reports DeGeorge, is designed to encourage more brokers, advisers and representatives to sign on. "Now it's paper intensive, time-consuming process," he says. "Reps feel it's a good product, but hard to sell because of all the paper. We want to make it easier for the consumer-make it less like buying a house with all the paper-retirement planning can be made very easy with this." Source: NAVA

Pearl River, N.Y. - Building upon the success of its initial rollout, the insurance standards body organization ACORD announced the expansion of its testing and certification facility to include test capabilities for ACORD Reinsurance & Large Commercial (RLC) Placing message implementations.

Hartford, Conn. - A new, automated system introduced by The Hartford Financial Services Group Inc. significantly hastens the creation and modification of personal lines insurance policies.

Seattle – Teenagers may liken Teensurance to George Orwell's all-knowing “big brother.” But Safeco is hedging its bets that parents will appreciate its new technology and services designed to help protect their teen drivers as they gain experience behind the wheel, and drive competitive advantage in the process. Safeco released its Teensurance product, which employs a set of online tools based on an on-board GPS and notification technology called the Safety Beacon. This new bundle of tools enables families to take proactive steps to monitor their teen’s behavior behind the wheel. Parents can set speed, distance and curfew limitations. A real-time notification service tells parents when their teen drivers are in danger. Teensurance is available to customers with Safeco auto insurance policies, and includes free installation of the Safety Beacon, which is guaranteed for two years. Safeco’s goal with Teensurance is to keep communications open about driving and the responsibilities that come with having a driver’s license. “Teensurance is a proactive solution to help our customers keep their families safe on the road, and the first in a series of Safeco innovations that push beyond traditional insurance to impact our customers on a broad scale,” said Jim Havens, vice president of consumer solutions at Safeco. The Teensurance program’s set of tools includes set “safe driving” zones to gradually ease new drivers into the driving experience; the ability to unlock a car door remotely using a simple code; access to 24/7 roadside assistance, a parent/teen contract and pertinent educational materials, including a “TeenDash” survey. Source: Safeco

New York – Aiming to capitalize on the record pace of mergers and acquisitions (M&A), Zurich has created a new business unit designed to cater to the companies involved. The unit, part of Zurich's global corporate business division, will offer customized products and services to help companies manage M&A transaction-related risks, the company says.

London - Though still nascent, enterprise risk management (ERM) programs are becoming more established amongst European insurers, a report from Standard and Poor's (S&P) has found. In its report, "Enterprise Risk Management Assessments on Europe's Insurers," S&P surveyed 70 European carriers about their adoption and use of ERM programs.

Boston - A new research report from financial research and consulting firm Celent predicts that online sales of insurance will double by 2011. Titled "Online Insurance Sales and Marketing: What's Happening and What's Next" the report projects that the Web will play a increasingly prominent role in personal insurance purchases.

Edison, N.J. - In the latest of several insurance-specific outsourcing vendor mergers and acquisitions, insurance software provider MajescoMastek has acquired Indianapolis-based Vector Insurance Services LLC (Vector), a technology solutions provider and third-party administrator that focuses on the North American life & annuity insurance industry.

London - Navigating the international regulatory landscape and addressing the challenges of catastrophe exposure reporting are among the subjects that will be broached when ACORD convenes its London Forum in October. ACORD is intending that the forum be a "meeting of the minds" that will unite insurers, reinsurers, solution providers, brokers and cedents from the UK, EU, and US. Dennis Mahoney, Chairman of Aon Global, is slated to deliver the keynote address. The forum will be held at Gibson Hall in London on October 17 and 18.

Waterloo, Ontario - Manulife Financial reports that it is launching the Canadian insurance industry's first new business notification feed that meets new national standards for delivery of information to agencies and their advisors dealing with the company. The feed, once processed, allows agencies and their advisers to view the underwriting status of policies on a daily basis, greatly reducing time spent on inquiries and follow up calls about their clients' applications. The process is the first to meet new guidelines outlined by the Canadian Life Insurance Electronic Data Interchange Standards (CLIEDIS). "This is a significant advance in service to our Managing General Agencies and National Accounts. These organizations are focusing on improved technologies to increase their office and business efficiency so they can spend more time working with clients," said Andy White, AVP, Distribution Systems, Manulife Financial. New Business Notification feeds provided through this new standard contain current advisor, policy and underwriting status of new business pending policies, based on the Canadian Insurance Transaction Standardization (CITS) Pending Case Status Implementation Guide from CLIEDIS. The Canadian Life Insurance Standards Association coordinates development of public standards for the Canadian life insurance industry. A distributor's feed will be available for download to its back office system through a phased launch on Manulife's advisor Web site, says the company. Manulife Financial is no stranger to best practice IT models, as the company has already made commitments in the areas of ITIL and CMMI, and expects their business units and subsidiaries in 19 countries to follow suit. For example, as reported in Insurance Networking News (December 2006), Manulife-Sinochem Life Insurance Co. Ltd., a joint venture of Canada's Manulife Ltd. and China Foreign Economic and Trade Trust & Investment Co., designed a customer-oriented service at the front-end, which requires CRM system support at the back-end. "Their product design is closely connected with the IT system and the IT accommodates the product quite well by playing a supporting role," says Thomas Wong, chief analyst at Beijing-based Analysys International. Source: Manulife Financial, Insurance Networking News

Armonk, New York - IBM has released more details about its SOA roadmap for the insurance industry. At a conference in May, the company said it would provide roadmaps for eight different industries, including insurance. The roadmaps are based on long-term industry outlooks and new IBM Business Blueprints that enable organizations to better align business and IT. The insurance roadmap provides real-time access to policy, claims and related data through multiple modes of communication with IBM's insurance for agent collaboration framework, the company says. IBM also announced the results of a survey of clients that concludes the strategic decisions about (SOA) adoption are shifting away from the realm of IT staffers to business executives. The survey was conducted for IBM by the Link Group and consisted of a sampling of clients at the IBM Impact 2007 event, which drew more than 4,200 technical and business leaders The survey revealed that 67% of the respondents said the key decision makers responsible for moving to an SOA strategy are business leaders including C-level executives and business managers. Additionally, 65% of clients said that business leaders are also primarily responsible for selecting an IT partner to help achieve business goals in an SOA. At the same time, the survey also found that there is an increasing need for training staff so they possess the unique combination of both business and IT skills required for a business to realize the potential of SOA. Source: MarketWire

Lexington, Mass. - FirstBest Systems, a Lexington, Mass.-based developer of underwriting management software has announced the formation of an Underwriting Knowledge Center.

Las Vegas - A feature on its Web sites that links directly to a physician's office has garnered an award for BlueCross BlueShield of South Carolina. The feature, called STATchat, took top honors in the "Best Use of Technology" category during the 3rd Annual Call Center Excellence Awards held recently in Las Vegas. STATchat allows a physician's office staff to call BlueCross over the Internet and gives them priority for customer service. Physician office staff members simply click on the STATchat icon to call for assistance without dialing any numbers by using an inexpensive headset with microphone. STATchat links the staff member with a BlueCross provider services agent, ahead of calls from physician offices using traditional phone lines. Both the awards and the conference are organized by the International Quality & Productivity Center (IQPC). Experts and practitioners in the call center field judged this year's award entries. "Providers who utilize our STATchat feature receive the help they need with little or no wait time," said David Boucher, BlueCross BlueShield of South Carolina's assistant vice president of health care services. "This allows our providers to better focus on their vital role of caring for their patients." Headquartered in Columbia, S.C., BlueCross BlueShield of South Carolina is an independent licensee of the Blue Cross and Blue Shield Association. Source: PR Newswire

Oakland, Calif. - Web-based options are playing a larger role in doctor-patient interaction, notes Kaiser Permanente. The Oakland, Calif., health insurer released a study that was published in the American Journal of Managed Care and describes how secure e-mail changes the way patients choose to access medical care. "Patient access to electronic health record with secure messaging: impact on primary care utilization" examines the use of secure e-mail between Kaiser Permanente members and physicians. According to the study: Patients with online access to an electronic health record (EHR) are choosing to use secure e-mail, thereby decreasing the number of primary care office visits and telephone contact rates. The study noted that the use of secure e-mail linked to an EHR decreased annual adult primary care outpatient visit rates by 7 to 10% and led to 14% fewer phone contacts than those not using online services. "The access to personal health management tools, including secure email is helping our members get care how and when they want it," states Yvonne Zhou, PhD, one of the authors of the study. "It is valuable to have been able to document an evolving trend that shows consumers are choosing to replace office visits and phone calls with electronic communication with their doctors." More than 1.4 million Kaiser Permanente members are registered to use the company's secure online services. Since launching secure e-mail services, more than 2.7 million e-mail messages have been sent to providers. Source: PR Newswire

Zurich, Switzerland - In the latest in a series of insurance-related executive announcements, Zurich Financial Services Group (Zurich) announced the appointment of Christian Orator to the position of Global Chief Claims Officer. He will assume his new role as of August 1, 2007. Orator, 44, and a Swiss and Austrian citizen, will succeed Jane Tutoki who was appointed Chief Claims Officer for Zurich North America Commercial. In his new position, Orator will be responsible for leading a global network of claims professionals and driving continuous improvement in the group's claims capabilities and customer service. He will be report to John Amore, CEO General Insurance, and will be located in Zurich. Orator currently heads special initiatives within the office of the Group Chief Administrative Office. He has extensive experience in the strategic planning, underwriting and claims fields having held numerous executive and operational positions in Austria, the US, Germany and at Corporate Center since joining Zurich in 1989. These roles include serving as a member of the German Executive Board, responsible for commercial lines and broker distribution. He holds a Ph.D. and master's degree in law from the University of Vienna as well as a master's degree in comparative law from Dickinson School of Law in the United States. Source: Zurich Financial Services Group

Los Angeles – At a time when acquisitions are plentiful in the insurance industry (see "More Acquisitions For the Insurance Industry") Los Angeles-based Farmers Insurance Group of Companies announced the completion of its acquisition of non-standard auto insurer, Davie, Fla.-based Bristol West Holdings Inc.Bristol West began providing private passenger auto insurance to Florida residents in 1973. Since that time, it grew to be a provider of liability and physical damage insurance at competitive prices. Bristol West operates in 26 states.