Digital Platforms

Needham, Mass. - A new market emerging from virtual reality into the real-world global economy is growing by leaps and bounds, according to Needham, Mass.-based TowerGroup Inc., yet remains largely unknown to the financial services industry. This new market is driven by the popularity of "massively multiplayer online role playing games" (MMORPGs) and online "virtual social worlds" (VSWs) - such as the hugely popular Second Life - where the lines between online and offline commerce are rapidly blurring.New research from TowerGroup finds that in 2005, online (nontravel) sales exceeded $83 billion (USD), of which virtual social worlds contributed $1.5 billion. As MMORPGs quickly develop into complete online economic systems, TowerGroup forecasts that the "real world" revenue they generate will reach $2.5 billion in 2006, and that the market will grow to 40 million people spending $9 billion annually by 2010. These virtual games include complete social and economic systems for which players use specialized browsers to engage in a virtual life. Each game provides the potential of interacting with multiple players simultaneously, and on a global basis.

Mount Laurel, N.J. - In an effort to lower costs for its members, simplify employee benefit plan administration, streamline processes, and make it easier and faster for members and employers to manage health care benefits, Mount Laurel, N.J.-based AmeriHealth New Jersey will offer new online capabilities through its Web site, www.amerihealthexpress.com, to its group customers and members, starting in 2007.Through a contract with Mount Pleasant, S.C.-based Benefitfocus.com Inc., AmeriHealth New Jersey will improve its self-service Web site by providing new Web tools to create an online resource for health benefit management.

Boston - Cutting-edge concept illustration software is at the heart of a new program at the Advanced Markets unit of John Hancock Life Insurance Co. to enable producers to create a presentation of a Charitable Lead Trust (CLT) specifically tailored to their client's situation.

Tampa, Fla. Arbitration Forums Inc. (AF) is introducing its E-Subro Hub System, a Web-based paperless network that acts as an electronic clearinghouse for subrogation workflow between insurance carriers and other parties involved in subrogation.The Web-based network, to be launched in September, was developed by AF, a provider of inter-insurance dispute resolution services, to streamline the subrogation process and reduce costs for thousands of insurers, self-insureds, third-party administrators (TPAs) and claims service organizations. The E-Subro Hub is expected to handle millions of transactions annually.

Chicago - Blue Cross and Blue Shield Plans has created a database of claims information (with no personal identifiers) from 79 million lives. Called Blue Health Intelligence (BHI), this resource is designed to help to improve health care quality through sharing critical health information initially with employers, and in the future, with consumers and providers.The secure, HIPAA-compliant database is significantly larger than existing healthcare databases, which may strengthen the movement to greater health care transparency by ultimately providing unmatched detail about health care trends and best practices.

Princeton, N.J. - American Re-Insurance Co. announced that in September 2006 it will change its name to "Munich Reinsurance America Inc."

Brookfield, Wis. - A wave of insurers will update their core processing systems in 2006 and early 2007, according to the results of an online survey on property and casualty insurance technology. The survey, conducted by Fiserv Insurance Solutions, a unit of Fiserv Inc., a Brookfield, Wis. software and services provider, revealed that interest in improving processing capabilities and offering better customer service underlies the emphasis on overall business process management and data accessibility.

Newark, N.J. - An arrangement between The Prudential Insurance Co. of America and the National Eldercare Referral Systems, Inc., will make the process of finding a long-term care provider easier by offering an array of valuable local and national long-term care information, quality ratings, and discounts, the companies report.

Armonk, N.Y. - In its third acquisition in less than 15 months specifically tied to its service oriented architecture (SOA) strategy, IBM, Armonk, N.Y., today announced it acquired Webify Solutions, an Austin, Texas-based privately held provider of industry-specific software and services for building service oriented architectures (SOA).

WHITEHILL ACQUIRES INSYSTEMSMoncton, New Brunswick-based Whitehill Technologies Inc. purchased InSystems, a wholly owned subsidiary of Standard Register, Dayton, Ohio, Financial terms of the deal were not disclosed. The combined company's critical mass will be nearly 1,000 customers strong, including several hundred insurance companies and more than half of the world's largest law firms, according to Paul McSpurren, president and CEO of Whitehill Technologies. Current InSystems customers should expect business to continue without interruption, according to the companies.

August - the heart of hurricane season.The hurricanes during August 2005 changed the insurance industry. In fact, with experts predicting a number of storms in 2006, carriers are taking action-developing tools and programs-to help their customers through natural disasters, especially hurricanes.

Today's consumer is king. With the ability to find an alternative solution for virtually any purchase in a few clicks on the Internet, consumers clearly have the upper hand. They are demanding more personalized products and services that meet their specific needs, and the ability to conduct business through any channel they choose-in person, online or by phone-without sacrificing service.As a consumer, these requirements are perfectly logical. As a business, they aren't that easy to fulfill in an environment where sales processes differ from channel to channel, and where customer data is historical, generally fragmented, and not always relevant.

24-HOUR ACCESS TO FINANCIAL FITNESSNew York-based Guardian Life Insurance Co. of America launched a proprietary Web-based system designed to help financial representatives enable their clients to instantly gauge their financial health and simplify their personal and business finances. The system enables financial reps and their clients to coordinate accounts from a menu of more than 3,000 financial institutions, access copies of important legal and financial documents from anywhere in the world, and get a comprehensive, up-to-date snapshot of their financial well-being.

Late spring 2005, the world learned that a crime ring that included call center employees of an Indian outsourcing company stole more than $300,000 from Citibank customers by tricking callers into giving up their PIN numbers.The news sent shockwaves through the industry, as India was the premier destination for business process outsourcing in the world.

Enterprise Risk Management (ERM) continues to gain momentum as an important issue among U.S. life insurance company senior management, and economic capital (EC) software may be the key to successful ERM.In its Life Insurance CFO Survey in 2006, the Tillinghast division of Towers Perrin, New York, focused on how life insurers approach ERM in general terms, their risk management objectives and how they define their ERM framework. The survey also analyzed companies' approaches to establishing EC-the minimum amount of capital that the firm needs to bear its risks-including planned improvements to their existing EC framework.

Stevens Point, Wis. - Sentry Insurance, a property, casualty and life insurance provider for personal and commercial customers, reported today that personal information on more than 112,000 of its customers was stolen, and that data on 72 of them was sold over the Internet.

Odessa, Del. - Information on search engine marketing, integrated marketing and competitive information on insurance company marketing trends is included in the "Insurance Direct Marketing: The Special Report on the Companies, the Practices, the Standards & the Benchmarks" report, released last week.

Washington, D.C. - The House is considering a bill calling for a bipartisan commission to help guide the federal government in its national disaster response management. If H.R. 5891, the Catastrophic Disaster Risk and Insurance Commission Act, is enacted, a 17-member panel (membership comprised of at least one independent agent) would be empowered to recommend to the lawmakers disaster management policies cost mitigation, and fraud reduction.

Chicago-CS Stars, an operating unit of Marsh, a Chicago-based risk and insurance services firm, today announced that a piece of computer hardware containing personal information of 540,000 injured workers held on behalf of the New York Special Funds Conservation Committee has been found and secured. The Federal Bureau of Investigation has told the company that it is reasonably certain that there was no use of any of the data stored on the hardware.

Waterloo, Ont. - California State Automobile Association (CSAA) plans to launch a pilot program this summer using telematics technology to improve driving safety. Using the DriveSync GPS vehicle tracking system from Intelligent Mechatronic Systems Inc. (IMS), CSSA intends to increase the value of AAA membership for itself and other AAA partners, including AAA Arizona, AAA Oklahoma and AAA MountainWest. Rapid vehicle location for roadside assistance and driver safety improvement are some of the areas that will be researched.DriveSync is a GPS vehicle tracking system that tracks vehicle location including the route, mileage and speeds of each trip. As a turnkey solution, IMS manages all aspects of driving data collection, storage, consolidation and reporting using fraud-prevention technology and military grade data encryption to ensure customer confidentiality. The system produces turn-by-turn trip logs, color-coded route maps and driving statistic reports, which can enable drivers to see a clear picture of their driving behavior and habits.

Worcestor, Mass. - The Hanover Insurance Group, Inc., a regional property/casualty company, is enhancing its billing capabilities, in an effort to deliver on its promise to make doing business with the company easy. Now, The Hanover is enabling agents to accept payments for new home and auto policies via electronic check, credit card and debit card at point of sale.Through the new enhancements, The Hanover's independent agent partners can accept electronic down payments for personal lines home and auto insurance or a full payment on a new policy during new business transactions. No transaction fees will be charged for this service. In fact, policyholders who pay for The Hanover's popular, multi-variate product, Connections Auto, in full via electronic payment will be eligible for a discount.

Detroit - Blue Cross Blue Shield of Michigan, will extend an e-prescribing partnership with the nation's three largest U.S. automakers, General Motors, Ford Motor Company and DaimlerChrysler Corp., the companies announced today. The Southeast Michigan e-Prescribing Initiative (SEMI), which is designed to reduce medication errors and decrease prescription drug costs through the use of e-prescribing technology, will be in effect for an additional year.

Los Angeles - Transamerica Retirement Services, a provider of Multiple Employer Plans (MEPs), has implemented online adoption and acceptance agreement capabilities. The new feature, called "AAA on the Web," is designed to simplify and streamline the process of adding new companies into an MEP by enabling both primary sponsors and adopting companies to review and accept the adoption agreement documents online.Prior to this implementation, the MEP and adopting company had to manually review the adoption and acceptance agreement. Now, the entire acceptance process can be completed online. Additionally, before this online feature was made available, the process of adopting employers into an existing MEP required the same amount of time and resources as a traditional single-employer plan set-up. This new online program can save companies time by limiting the provision approval process to only those that are unique to the adopting company, while the standard MEP provisions are automatically implemented.

Columbia, S.C. - Colonial Life & Accident Insurance Company, a Columbia, S.C., business unit of UnumProvident Corp., Chattanooga, Tenn., has launched a new online enrollment platform that offers employers daily enrollment reporting and secure employee data exchange, reports the company.

Atlanta -Blue Cross Blue Shield of Georgia (BCBSGa) has launched statewide the 360 Health benefits program. Georgia is the first state to have access to this new program through WellPoint, BCBSGa's parent company, which will provide health information and counsel collected from thousands of physicians, nurses, and other healthcare professionals to BCBSGa's 3.1 million members through a single point of contact.360 Health is a program designed to integrate all care management programs and tools into a centralized, consumer-friendly resource that assists members in navigating the health care system, using their health benefits and providing information to help them to access comprehensive and appropriate care.

Los Angeles - Mercury General Corp., a Los Angeles-based auto insurer, is using a new interactive destination Web site to highlight its recent advertising campaign—Mercury Theory.The campaign features a suite of 10 30-second TV commercials and the interactive Web site www.mercurytheory.com.

St. Paul, Minn. - Travelers, a business of St. Paul, Minn.-based The St. Paul Travelers Cos. Inc., developed a two-CD set called The Best of Technology Risk Control to help small technology businesses deal with issues such as property protection, employee safety, reducing liability exposures and creating business continuity plans.The risk control CD contains 120 of the most requested risk control information guides on topics pertaining to the information technology, medical technology, telecommunications and electronics manufacturing industries.

Chicago - Stating that 50 individual sets of individual insurance regulations results in a lack of transparency and a bottleneck to global trade, Frank Keating, president and CEO of the American Council of Life Insurers, called for an optional federal charter yesterday during his address to the International Insurance Society here.

Hartford, Conn. - The Hartford Financial Services Group Inc.'s online Quote-to-Issue (QTI) system for rating, quoting and issuing comes in handy with its enhanced Dimensions auto insurance program, which will now be offered as Dimensions with Auto Packages. The Hartford expects online users to get and compare quotes for these packages to be faster and easier than before."We understand the demands on agents and the need for their staff to process business fast and efficiently," says Mike Concannon, senior vice president of personal lines for the Hartford, Conn.-based insurer. "Our QTI technology makes it easy for them to work with The Hartford."

Chicago - Attendees at the International Insurance Society 42nd Annual Seminar in Chicago identified natural catastrophes--over pandemics, geopolitical instabilities, terrorism and man-made catastrophes--as the biggest threat to the future of the insurance industry.The question was posed to the more-than-100 attendees of the July 19, 2006 CEO Panel V: Catastrophic Risk and Insurability: Can the industry cope? Edward Liddy, chairman and CEO of Northbrook, Ill.-based Allstate USA and Pierre Ozendo, head of Americas Property & Casualty, Swiss Reinsurance America Corp. USA, Armonk, N.Y., spoke to the attendees on the subject.

Newark, N.J. - Chronically ill Horizon Blue Cross Blue Shield of New Jersey members and emergency room physicians can now access health histories and records, along with other important information, with a quick scan. The Newark, N.J.-based insurer announced a two-year collaboration with Hackensack, N.J.-based Hackensack University Medical Center, its physicians and the VeriChip Corp., Delray Beach, Fla., to implant FDA-approved microchips in chronically ill patients enabling emergency room physicians to access those patients' medical record electronically. The microchips provide immediate access to family contact information and information about the patients' medical histories.Horizon BCBSNJ will make the new technology, developed by VeriChip, available to select members with chronic conditions. Those members who participate in the program will agree to have an implantable radio frequency identification device (RFID), the size of a grain of rice, placed under their skin.

Chicago - The Windy City will host more than 500 attendees from 55 nations this weekend at the International Insurance Society's 42nd annual seminar.

Needham, Mass. - Recent trends and statistics on how we live, communicate, and work today point to significant changes poised to reshape how U.S. insurance carriers respond in areas such as products, services, and the use of technology. TowerGroup believes that over the next few years, the leading insurance companies will embrace these changes and use their scale, financial strength, and flexibility to maintain a sustainable advantage.

Washington, D.C. - In the first of in a series of government meetings on modernizing insurance regulation, the focus on whether insurers should be given the option of being federally regulated took center stage this week at a U.S. Senate Committee On Banking, Housing, and Urban Affairs hearing on "Insurance Regulation Reform."

Hartford, Conn. - Though Citigroup's recent sale of Travelers Life & Annuity to MetLife may appear to indicate that the "financial supermarket" idea of full-scale mergers is an untenable working model, banks and insurers continue to find ways to integrate their services, according to a new study by Conning Research and Consulting, Inc., Hartford, Conn.

New York and Dayton, Ohio - The competitive online marketplace is being bolstered by two more companies planning to offer consumes an online insurance shopping experience.

Springfield, Mass. - MassMutual Financial Group today unveiled a new addition to its Web site designed to focus on the financial needs of women, enabling them to educate and empower themselves to help build a more secure financial future.

Minneapolis - Allianz Life Insurance Company of North America will integrate detailed insurance data with investment information for USAllianz Securities, a broker dealer subsidiary of Allianz Life. The agreement represents the first time any practice management system will integrate comprehensive financial and insurance information, according to Investigo Corp., the practice management provider that is providing the solution.Investigo CEO Tom Rozman cites results of an investment industry survey that his firm conducted last fall. "Broker dealers are starving for information and must have a way to track the sales of insurance products through their firm."

Oak Park, Ill. - Home page usability of many insurance companies isn't up to snuff. That's according to a study by Vox Inc., a firm focused on increasing retention and referalls by improving the customer experience. The study analyzed the positioning of key customer and user elements, such as insurance quote and "find an agent" functions. Each company was given a rating based on a set of usability and benchmark criteria.One exception to the overall findings is 21st Century, which recently redesigned its home page to improve the positioning and clarity of the various user elements.

Jersey City, N.J. - Catastrophic wildfires cause extensive damage to property and significant disruption to the lives of property owners. In 2005, more than 8.5 million acres burned, nearly twice the 10-year average. This is according to ISO, a provider of products and services that help insurers measure, manage and reduce risk.With more people living closer to brushfire areas, which also happen to be preserves of privacy, the exposure has nearly doubled for insurers between 1970 and 2000.

Washington, D.C. - NASD has introduced a new series of free, on-demand video Webcasts for compliance professionals that's aimed at taking the mystery out of key regulatory processes and making firms' interactions with NASD more productive and efficient.The first installment of the new "What to Expect" series focuses on what firms can expect before, during and after an NASD examination and offers practical tips for making the process go smoothly. While all NASD-registered firms can benefit from viewing this Webcast, "What to Expect: Preparing for an NASD Routine Exam" will be of particular interest to firms on a four-year examination cycle whose examinations are coming up, given significant changes in the regulatory environment in recent years.

Mexico City - When ING Mexico, a provider of insurance, pension benefits and financial services in Mexico, needed a way to enhance customer service by connecting customers to the right agent and at the right time, the company selected an intelligent communications solution from Avaya, a provider of business communications applications, systems and services.With branches located throughout Mexico, ING needed to centralize its customer care operations in order to improve efficiency and customer service. The company established a contact center in Mexico City with 305 employees and 229 agent positions that attend to an average of 220,000 calls each month. Car accident reports, health and life insurance inquiries, pension information and tele-sales are some of the services provided via the contact center in addition to services for ING employees such as IT and HR support.

Cary, N.C. - Reaping business benefits now matches regulatory compliance as the key driver of enterprise risk management (ERM) systems according to a global survey of 339 financial services executives. These benefits include improved performance management, better risk-based pricing, and reduced capital allocation and credit loss. These are the results of research conducted by SAS, a business intelligence provider.A full 83% of participating financial institutions view ERM as a strategic priority, per the survey. Many are setting up new ERM or "integrated compliance" programs. The survey also found that credit risk management is still the top risk management expenditure priority for most firms. In addition, 78% of respondents view credit risk management as critical and anticipate significant, quantifiable economic rewards over the next 24 months, including a 10% reduction in economic capital and a 14% reduction in cost-of-credit losses.

Beverlyy, Mass. - Electric Insurance Co. has named Marc A. Meiches, 53, president and chief executive officer. Meiches succeeds Larry Cohen who has been acting CEO since April 2005.Meiches comes to Electric Insurance from GE Insurance Solutions (GEIS) where he was the executive vice president and CFO. He joined GEIS in 2000 with more than 20 years of financial experience in creating and leading global organizations. GEIS, with more than $10 billion in premium and $50 billion in combined assets, employed 2,500 people in 50 states and 22 countries. The company was recently sold to Swiss Re.

Worcester, Mass. - The Hanover Insurance Group Inc., a regional property and casualty company has introduced a business owner's policy (BOP) class comparison look-up tool. The tool is designed to help The Hanover's agent partners quickly and efficiently categorize a small business owner's industry classification and obtain a quote for the company's Avenues BOP faster than ever."The new BOP class comparison look-up tool will simplify the quoting process for our agent partners, saving them precious time and helping them achieve even greater productivity," says Marita Zuraitis, president of The Hanover's property and casualty companies. "This tool is yet another example of our commitment to continuous improvement and to deliver on our promise to provide world class products and services, while doing whatever it takes to make it easy for agents to successfully conduct business with us."

To many insurance industry executives, compliance means spending gobs of money to avoid having their companies go public with ugly security lapses or pay fines from regulators, or avoid having themselves hauled off to the slammer for misstating information. However, the process of meeting compliance mandates need not be costly-and may actually help increase profits in the long run.For many carriers, there are ways to establish a common base of processes to address multiple mandates, as well as any future requirements. In addition, compliance management can bring new opportunities for gaining better efficiencies and supporting new business growth.

Do drivers who wear turtlenecks get in more accidents than drivers who don't? What if the theory proved true? Although it would be nice to find out whether this level of minutia affects accurate pricing of risk, when it comes to ratings, this question is not one insurers are asking-yet. But insurers are finding unique ways to price risk-from aggressive braking patterns to career choice. Progressive is one such insurer taking steps toward accuracy, and it's using technology to do so. Most recently, Mayfield Village, Ohio-based Progressive Direct Insurance Co. launched an odometer-reporting, Web-based pilot program in Iowa and Virginia. And, in the summer of 2004, the carrier began piloting a usage-based program in Minnesota called TripSense.Using a device called a TripSensor, which plugs into the ODBII port in newer vehicles, Progressive is collecting driver data in the hopes of creating a win-win for its underwriters and its policyholders.

AGENCY WEB PORTALNew York-based P&C Insurance Systems Inc. introduced a Web portal that allows direct Web-based upload of ACORD data from agency management software. The portal leverages the architecture of the PCIS management system to provide Web-based multi-line rating, real-time agency access to quote documents, and up-to-date agency production reports.

DESPITE DEADLINE, MANY FIRMS LACK AML PROGRAM

Insurance Networking News recently interviewed Marcus Ryu, vice president of consulting services, at Guidewire Software Inc., a San Mateo, Calif.-based firm that provides software to the P&C and workers' compensation industries. Ryu plays a central role in developing and implementing leading solutions for the insurance industry.INN: In the white paper titled, "Achieving Underwriting Excellence with Guidewire PolicyCenter," you cite a study by McKinsey & Co. What did that study reveal?

EMPIRE PACIFIC CHOOSES WC SOLUTION

Yonkers, N.Y. – The August issue of Consumer Reports warns consumers that even drivers who have spotless driving records and have never had an at-fault accident may be faced with higher premiums if their insurer uses credit-based insurance scores.The report describes credit-based insurance scores as numbers that are computed from bill-paying and loan data collected by the major credit bureaus. They have become as important in determining annual premiums as driving records and neighborhoods, the magazine states.