Distribution

When Blue Cross Blue Shield of South Carolina wanted to streamline its call center operations to improve productivity, it did not re-invent the technological wheel. Instead, the Columbia, South Carolina-based insurer implemented state-of-the-art software to leverage its existing IT systems.The intuitive, single browser-based interface simplifies data gathering and interpretation for its more than 350 customer service representatives.

It seems that everyone is jumping on the wireless bandwagon. From cell phones to PDAs to wireless pagers, both professionals and consumers are seeking new, more efficient means of communication. The fast-paced growth of wireless technology in other industries hints at the tremendous potential benefits these solutions may hold for insurance.With wireless technology, agents can have a continuous connection to their information resources, management staff can monitor business from any location, or instantly respond to time-sensitive communications, and clients can look forward to faster response times. That means support issues that once took 24 hours and two or three phone calls can now be resolved in a matter of minutes via wireless e-mail.

As banking companies from coast to coast buy agencies to get into the property/casualty insurance business, Fifth Third Bancorp, for one, is getting out.In late December, the Cincinnati-based regional banking company announced it agreed to sell its property/casualty insurance operation to Hub International Ltd., an insurance agency based in Chicago, for an undisclosed amount of cash.

Back in the prehistoric 1990s, The Hartford Financial Services Group applied technology the old-fashioned way. It used a vertically oriented approach to solve problems in discreet business silos.Today, the $15-billion investment and insurance company is taking an enterprisewide viewpoint when it applies information technology. This new approach ties together disparate information technology offerings, simplifies some of the complexity of e-business and makes it easier for distributors to sell and service The Hartford's insurance products.

Over the past year, The Hartford Financial Services Group has launched several technology initiatives aimed at making life easier for distributors. Those efforts will continue this year as new features and functionality are added to The Hartford's eService and eSales programs.Last year, the company introduced the industry's first premium audit search tool available to agents through the Internet. This online tool augments the company's policy, billing and claims service capabilities available to agents through its Electronic Business Center (EBC), a secure Web extranet built exclusively for independent agents that represent The Hartford. Using this tool, agents can use the Internet to quickly determine the outcome of a commercial customer's audit and the reasons for any premium adjustment.

The insurance industry has made great strides in recent years in transacting insurance electronically. Yet there is no doubt that the barriers that still exist, whether real or perceived, must be toppled to allow insurers to join other industries in the pursuit of technological advances that provide greater choices and better service.State insurance regulators have taken the lead in addressing the barriers to electronic transactions. In the last few years, clarifications regarding electronic transactions were reviewed and guidelines issued with the release of a model bulletin by the National Association of Insurance Commissioners (NAIC). The NAIC model stated that electronic transactions should be treated no differently than paper transactions.

Annuities have been a mainstay product in banks since the 1980s, and over time, many providers have tried to push into the crowded channel. Has it gotten too crowded?Given the litany of failed bank-channel programs-Sage Life and Massachusetts Mutual Life come to mind-that litter the annuity battlefield, the answer looks like yes.

When insurance carriers talk about an insurance-sellingprogram designed around "bricks and clicks," it usually implies that services are offered both offline and online.While this remains the primary application, Baltimore-based Zurich North America Small Business has taken the concept in a different direction. Through development of its Buildersrisk.com Web site, the global insurance giant provides "clicks" that literally insure "bricks."

Unlike many other insurance contracts, annuities are marked by significant fluidity where accounts change daily, weekly and monthly. When an accountholder makes a change, the service provider must be prepared to hold up their end of the bargain.This isn't always easy. A report commissioned by Edison, N.J.-based NaviSys Inc. states that "many potential customers fear the loss of control of their money as an immediate annuity essentially locks up those assets for the rest of their lives."

Industry analysts predict that small-business owners will spend more than $40 billion on commercial insurance this year-as much as one-third of the total commercial insurance market. Most of this lucrative business is going to a few captive carriers, leaving independent agents and their carriers to divvy up the rest.Yet, consumer studies indicate that small-business customers want a broad choice of products from multiple carriers-something they can't get from a captive agent. What's preventing the independent agency system from snatching such a blatant opportunity?