Cash-strapped and under-staffed human resource administrators urgently need help. They don't have the time or inclination to enroll employees, deal with evidence of insurability, or handle personal employee health information.

Minnesota Life Insurance Co. listened to its corporate customers and responded. "We looked at what technologies we could put in place so that benefits administrators could get out of the insurance business," explains Maria O'Phelan, second vice president, group life insurance customer service and technology.

This is second nature for the St. Paul, Minn.-based information technology leader. For example, it was one of the first group life insurers to offer online enrollment, online account management, electronic signature, electronic document distribution and single sign-on technology to large employer groups. It was also one of six finalists for the A.M. Best 2002 E-Fusion award, given in recognition of outstanding resourceful use of Internet technology.

Its most recent customer service challenges took the insurer outside its industry in search of technology solutions. "We looked at the sites of retailers such as and Lands' End for clues about how to make our online experience better for customers," says O'Phelan. does a great job of telling customers an order status, removing the anxiety of whether or not your order has fallen into a black hole, according to O'Phelan. The Land's End site simplifies the complex process of choosing colors, sizes, styles, and trouser lengths. If you have a question, you can get it answered before you log off of the apparel Web site, she notes.

Using the retailers as guides, Minnesota Life implemented two major technology solutions in 2003. It unveiled a "real-time" insurance underwriting response service and a computer telephony integration (CTI) system that, in effect, transforms its call center into a contact center.

Real-time underwriting

"Our real-time underwriting system lets online applicants know right away if they have been approved for life insurance coverage, even when evidence of insurability is required," says O'Phelan.

"It takes about 60 seconds to get an answer and either the applicant is approved or they know right away what to expect next."

The rules-based underwriting system asks applicants simple questions such as their height and weight. If the responses are within Minnesota Life's guidelines, applicants can receive their initial approval within a minute.

As part of the real-time process, employees complete an online health questionnaire, attach their electronic signature and submit the evidence of insurability (EOI) form-all through a secure connection. The Web-enabled technology completely eliminates the need for employees to fill out a paper form, mail it into the insurer and wait for a response. It also takes HR staff out of the paperwork loop.

If an employee or employer needs an insurance question answered while they are on the insurer's LifeBenefits Web site, they can send an e-mail to Minnesota Life. Typical response time is five minutes.

"Having e-mails answered by our customer service representatives (during normal business hours) within five minutes does create a 'wow' factor," says O'Phelan. "It reflects positively on the employer and on us. And it's very impressive to clients because most people are used to online responses to e-mail requests taking anywhere from 24 to 48 hours."

Live online help

The second major technology innovation implemented by Minnesota Life in 2003 is a rather unique computer telephony integration system.

The enabling software is made by Indianapolis, Ind.-based Interactive Intelligence Inc.-the same technology service provider used by Lands' End. The solution has transformed Minnesota Life's call center into a contact center.

If employees need additional help while managing their accounts on the LifeBenefits Web site, they can send an instant message to a Minnesota Life customer service representative.

The representative's name and photo then pops up on the employee's desktop screen, along with a greeting and an offer of help.

The group life carrier learned from its large employer client base that customers were getting frustrated if they had only one phone line. That's because they would have to log out of the Web site and then call the insurer's toll-free number. Once they got the advice, they would then log back online to use the suggestion.

"What's huge about the chat line is the customer doesn't have to hang up to call an 800-number to get questions answered," explains O'Phelan.

"When people are on our Web site, they are trying to make a buying decision," she continues. "And if we can answer their questions quickly, not only do we increase the chance they will take insurance, we also make them feel good about their employer that chose us. So it's a positive reflection on the employer which is a positive reflection on us," she adds.

The Web-enabled administration of group life benefits frees up time for the human resource department, at a time when HR budgets and staffing have shrunk. In addition, benefits administrators no longer have to be a go-between for conveying personal health information back and forth between employees and the carrier.

"When (HIPAA) privacy rules took effect, HR people felt uncomfortable handling the private medical information of their employees," explains O'Phelan. Getting a simple Evidence of Insurability (EOI) processed was a four-step paper process with the HR function caught in the middle.

"Now the employee goes online, fills out a form and within a day they are being underwritten," explains O'Phelan. "We've eliminated all of the mail delays for the employee and we have streamlined the HR workload and enabled them to get out of the insurance and the personal information business."

The cost savings to client companies moving from a paper world to an electronic world varies depending on the number of employees and how their benefit program is designed, says O'Phelan.

In one case, a client had a full-time person who handled claims information. "We came up with an electronic way to extract the information from their benefits platform so the HR department was able to reassign the person," she explains. "We know HR departments are getting major chunks of time freed up, but we aren't able to quantify it."

As part of the technology innovations, client employers have a separate secure Web site that they can use to e-mail sensitive employee Social Security information, find out if a claim has been paid, print out life insurance forms and obtain aggregate information on their employees.

Growth accelerates

Minnesota Life sales have clearly increased as a result of the technology innovations. In fact, since the group life business unit began aggressively applying information technology in 1999, its five-year compound annual growth rate is more than 20%.

"We're not a household name and we don't advertise. Yet we have made a name for ourselves by becoming the leader in technology," says O'Phelan. "We've gotten the right people to know who we are through word of mouth in the HR benefits field," she adds.

Minnesota Life breaks even on the cost of the customer service technology innovations. "We didn't implement the technology to make a profit on it. Our goal was to attract and retain customers and we have done that," adds the executive.

Minnesota Life has recouped some of the expense of the IT innovations. "We easily have not hired about 10 customer service representatives in the last five years. Before that we were hiring two or three people a year," explains O'Phelan.

The numbers prove her out. In 1997, the group life unit averaged 11,000 insureds per customer service representative; in 2003, it averaged 15,600 or a 42% increase in productivity. Overall, 800,000 client employees have access to the Web-enabled programs, or about 30% of its group life customers. About 100 employer clients use the technology.

By the time enrollment season rolls around this month, an applicant who needs a medical exam before getting life insurance coverage will be able to schedule that exam online or through a call back from an underwriter.

"We will be piloting the program this fall and it will be connected to our real-time underwriting response initiative," O'Phelan says. Also, the insurer will be adding e-mail notification to keep applicants informed of every step in the application process. "Communi-cation is what has been missing in the EOI forms online," she adds.

The group insurer will also be making the system more robust so employers can run reports or get e-mail notification when claims have been paid. These IT enhancements are scheduled to start in the first quarter of 2005.

"We never want to say clients: 'Our system won't let us do that.' We'll figure out a way so that we can provide the ultimate in service," says O'Phelan.

Brian S. Moskal is a business and financial writer based in Chicago.

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