Insurance

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."

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.

From the healthcare carrier's perspective, the logic is simple: Support physician members' ability to access aggregate patient data and use of e-prescribing and e-doctor visits. Physicians use technology to provide improved quality care, business- and patient-related efficiencies. Ultimate ROI: healthier patients and reduced exposure associated with later health-related problems.Long-term results may not be available yet, but carriers have high hopes for programs designed to create incentives for providers that will help create a "healthier" patient base.

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

It's no secret that the onslaught of insurance industry mergers and acquisitions (M&A) has left many a carrier bruised and battered. Combining systems-IT and human-requires forethought, skill, dedication and focus.There may not be much consolation in the knowledge that insurance M&A activity increased in 2005 to the highest level since 2001 and may foreshadow an acceleration of activity this year and the next, according to Conning Research and Consulting Inc., Hartford, Conn.

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?

During 2005's July 4th weekend-a time typically filled with barbeques, fireworks and celebrations, Employers Direct Insurance Co., celebrated, but not for the same reason most other Americans were celebrating. This particular weekend marked the moment Employers Direct began its quest for improved efficiency through automation by going live with Guidewire ClaimCenter from San Mateo, Calif.-based Guidewire Software Inc.Headquartered in Thousand Oaks, Calif., Employers Direct was founded in January 2003 to meet the workers' compensation needs of California employers, including those of hotels, restaurants, country clubs, new car dealers, manufacturing companies, specialty supermarket chains and retailers. Employers Direct operates via a direct-to-consumer model.

The world of commerce and insurance more specifically is shifting relentlessly from a paradigm based on tangible assets to one based on intangible assets. Increasingly more insurance companies will succeed with fewer people with deeper industry or functional knowledge and with significantly less dependence on physical artifacts, such as paper.This is not an Internet-era crazed screed about insurance agents disappearing. Rather, my point is that insurance companies themselves must change the way they do business if they are to attract and retain the policyholders and producers necessary to profitably stay in business.

Consumer satisfaction with the P&C insurance industry increased by a mere 1% last year, according the American Customer Satisfaction Index (ACSI)--a survey to monitor customer satisfaction levels in various industries. Overall, satisfaction with the P&C industry has declined nearly 5% since 1994--the first year of the survey produced by the University of Michigan.Insurance carriers face a unique challenge with customer communications because they depend on so many different channels. Unlike other service providers, such as banks or telephone companies, carriers don't own every interaction with the customer. Independent agents and third-party administrators are often the main point of contact, slowing down the transfer of information.

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.

Washington, D.C. - Insurers should offer consumers better information about consumer-driven health plans and other benefit plans, according to a report issued by the National Committee for Quality Assurance, a nonprofit organization that provides information on the quality of the nation's managed care plans. In a recently released white paper the Washington-based NCQA accredits health insurers for meeting certain standards of performance.

Decatur Ga. - The Progressive Group of Insurance Cos., broke ground for its new Service Center in Decatur, Ga. Georgia Insurance Commissioner, John W. Oxendine, was on hand for the ceremony.Scheduled to open late this year, the site will feature a 19,000 square foot service center and marks Progressive's expansion in Atlanta of its "concierge" claims service that oversees all elements of the claims and repair process on behalf of drivers involved in accidents. Progressive claims its concierge service reduces the time drivers spend on repairs from four days to about 15 minutes.

Hartford, Conn. - With fewer large books of business changing hands recently, insurance agencies are relying on staff-driven, organic growth to expand their operations. Compensation packages and new recruitment and training strategies have shifted to reflect this trend, and also to address the shortage of trained sales professionals, according to the recently-published Business Management Group, Inc.'s "2006-2007 Owner, Executive and Producer Compensation Survey."Business Management Group (BMG), a subsidiary of The Hartford Financial Services Group Inc., is an independent agency/broker consulting firm that has surveyed and published agency compensation studies since 1990. The surveys enable agencies to benchmark their compensation plans against industry norms by looking at various factors, including revenue size and region.

Alpharetta, Ga. - ChoicePoint (NYSE:CPS) is acquiring the assets of Memphis, Tenn.-based USCerts, which provides technology and data management services to facilitate the remote ordering of certified birth, death, marriage and divorce certificates. Terms of the acquisition were not disclosed.USCerts combines technology with user-friendly interfaces to provide a secure, remote vital records ordering system. The company also provides a network for processing vital record requests by telephone, facsimile or the World Wide Web.

New York and Atlanta - Assurant Inc., a provider of specialty insurance and insurance-related products and services, has received two patents for call processing systems developed within its Assurant Solutions business.These systems optimize sales and retention efforts in contact centers through a series of dynamic customer and agent analytics. Assurant Solutions is offering the systems to its clients and making them available to other entities.

New York - A core concept of asset allocation, use of proper tools and technology, is part and parcel of successful portfolio management, yet many mutual fund firms do not provide tools to help investors with this important undertaking, according to a new report issued by Corporate Insight. The New York research firm takes an in-depth look at asset allocation tools provided by eighteen mutual fund firms.

Des Moines, Iowa - The Principal Financial Group is introducing an online tool--called the Treatment Cost Advisor--designed to help members evaluate the price of specific procedures as well as medications. The tool responds to a growing need from employers who are encouraging employees to make smarter health decisions."Understanding health care costs is complicated, so we wanted to offer a way for our members to identify and compare pricing for everything from minor procedures to surgeries and hospital stays," says Carey Jury, senior vice president of the health division for the Principal Financial Group. "As consumer driven health care continues to evolve and more responsibility shifts to employees, we must provide tools and resources to help our members make informed health decisions."