Technology has undeniably simplified how independent agents receive and send information to insurers. But the high expectations that accompanied the development of real-time interfaces and Web portals hasn't been achieved largely due to this simple fact: Insurers are faced with a Catch-22 dilemma. Many aren't inclined to aggressively roll out real-time capabilities to agents unless they're certain agents will use the services. But the trouble is, many insurers can't be sure.As a result, carriers continue to pin their hopes of program adoption on their preferred agency partners-using these agencies as a testing ground for future expansion. To be sure, independent agencies that have developed an affinity for technology are championing these carrier and vendor-led e-services programs and using their influence among fellow agencies to embrace adoption.

Preferred agencies often play a key role in the actual development of e-services solutions as insurers take less of a "home-office" approach to program formulation. Instead, insurers are going out to the field to assess agency workflow processes before proceeding with a development strategy.

The agencies on the leading edge of technology adoption continue to push the envelope with the e-services they're provided.

At Molyneaux Insurance Group LLC, a Chicago-based managing general agency, accessing their customers' policy information was not a task for the faint-hearted. Not long ago, the agency's field producers and their internal support staff had to keystroke up to 35 different user names and passwords to access various policy administration systems from its preferred partner, MassMutual. The proliferation of agent credentials partially stemmed from a 1996 merger of MassMutual and Connecticut Life Insurance Co.

Too much work

The effort proved so cumbersome that agents occasionally opted to eschew annual client portfolio reviews for a portion of their customer accounts.

"Data was incomplete and it just proved to be too much work," says John Molyneaux, principal of the agency, which generates about $300 million in insurance commissions a year, serving 42,000 client accounts.

The agency sells life, disability income, long-term care, annuities and mutual funds through a network of 150 agents and brokers.

After plugging away the past few years to improve its e-services support to agents, MassMutual in January launched a producer Web site, called FieldNet, which is winning high praise among agents.

As FieldNet was launched, MassMutual also streamlined user credentials, shaving the number of passwords from 35 to nine; by the end of the year, it will be whittled to seven, and ultimately, to one.

That wasn't all. Designed within the FieldNet platform, MassMutual in August rolled out Portfolio Audit and Account Review (PAAR). Equipped with real-time capabilities, PAAR enables producers to prepare accurate, up-to-date reports of client investment and insurance portfolios.

Using ACORD XMLife industry standards, MassMutual agents can now in minutes complete a portfolio analysis that used to take hours, according to Molyneaux.

Support for real-time interfaces by MassMutual and others may be music to the ears of independent agencies such as The Molyneaux Insurance Group. But not all independent agents are joining the chorus.

To date, many still lack even rudimentary electronic capabilities to maximize insurer e-service offerings.

"Believe it or not, there are still independent agents who don't have download capabilities from their agency management system," says Bruce Fiori, second vice president commercial operations, for the newly merged St. Paul, Minn.-based St. Paul-Travelers Inc.

"Carriers are a bit disappointed with the adoption rate of e-service capabilities of their agents," says John Day, senior vice president for carrier and industry relations, for Windsor, Conn.-based AMS. "Agents tend to be a conservative group of people. They get accustomed to a workflow process and it takes time to consider a new process."

But carriers are also to blame for the slow pace of e-services adoption, industry experts say. While carriers are discouraged by low agency participation in their e-services programs, agents believe that many carriers aren't meeting their expectations.

Expectation gap

"The gap between expectations and performance tripled on five of the 10 factors of ease of doing business," says Paul Croke, a founding partner for Deep Customer Connections. Research from the Scituate, Mass.-based management consultant group indicates agents expect more from insurers when it comes to enhancing their "ease of doing business" requirements.

"Carriers' performance improvements were encouraging, but they were dwarfed by large increases in agents' expectations," he adds.

Jeffrey Yates, executive director for the Agency Council for Technology (ACT), notes "there is unprecedented opportunity now-particularly with XML standards in place-to embrace flexible and open operating environments." ACT is an operating unit of Alexandria, Va.-based Independent Insurance Agents & Brokers of America (IIABA).

But Yates adds this caveat: "I don't use the term SEMCI (single-entry, multiple-carrier interface) anymore. It has too much 'emotional baggage' with agents. Agents want to be able to quickly and conveniently have access to their trading partners. Some carriers continue to have a hard time breaking out of insular mindsets. Future success means interacting outside proprietary environments."

Web services adoption

The adoption of true Web services is a goal many industry participants share. By definition, the modular, shareable nature of Web services enables organizations to easily enhance the functionality of applications, leverage investments in old legacy systems, and make system improvements. Web services provide interoperability between platforms without special integration efforts.

But large-scale Web services implementation continues to be undermined by two factors: Many insurers still operate within legacy system environments. And, insurers have "spent a lot of money developing proprietary Web sites, so they want to make the most of those investments by maintaining a proprietary operating mentality," states Doug Johnson, executive vice president, interface services, with University Park, Ill.-based Applied Systems Inc., a technology provider of agency management systems.

"We have seen insurers become active with Web services, but when you think about it, this industry spent millions of dollars to develop their proprietary Web sites. It's going to take billions of dollars industrywide to make Web services happen," adds AMS' Day.

Meanwhile, insurers agree that fostering a non-proprietary operating mentality is no longer a luxury, but a necessity.

"At our company, we had to get away from notion that using proprietary standards was the way to conduct business," says MassMutual's Hector Maury, second vice president, field efficiency. "Once we talked to vendors about supporting our efforts, it was an easy case for them to accept. A vendor doesn't want to build proprietary standards where they have to link separately with each carrier they have a relationship with," he says.

"It's important that we all march down the same road by developing a single platform from which to operate," says Jeanne Lind, assistant vice president of automation for Seattle-based Safeco Business Insurance, a unit of Safeco Inc.

"We stepped back and took a hard look at the things agents had to do to write new business. For business owners' policies (BOP), all the back and forth processing that must occur is significant," she says. "Our agents wanted an easy-to-use platform supported by automated underwriting, where they could obtain a BOP quote in minutes. We're providing this capability with our SafecoNow selling tool."

Insurers can more easily gravitate toward these capabilities by reaching out and aligning with vendors and agency associations to hear what agents believe is important to their workflow.

For AMS, a watershed period occurred in 2002 when it surveyed its agent customers about e-services priorities. And it made key investments to ramp up agent electronic efficiencies.

"They wanted real-time transactional capabilities, particularly to support policy inquiry, policy servicing, billing and endorsements," Day explains.

"They also indicated a desire to perform workflow straight from their agency management systems. So we developed a software plug-in and provided access to carrier data via their Web site. Agents also indicated they wanted a single sign-on capability to avoid multiple log-ins."

AMS has 45 insurers using its TransactNow platform to conduct transactions with their agents. TransactNow interacts with carriers' Web sites at the network level to enable interface communications between AMS agency management systems and carriers Web sites for policy, billing and claims inquiries.

Collaborative effort

In the final analysis, achieving a higher level of e-service adoption on the part of agents is really driven by what industry experts say is one major objective: To reduce the time spent handling routine tasks.

The logic is that if agents spend less time overseeing these tasks, they can devote more quality time serving customers and growing their business.

MassMutual came to this conclusion when it rolled out the FieldNet and the PAAR programs. "We believe that our PAAR program enables agents to spend time where it offers the greatest return-in nurturing and building customer relationships," Maury explains.

Electronic capabilities play a role in this effort. That's why more insurers are coming to the conclusion that to attract the best independent agents, they must provide the best tools and technologies. But they won't know what agents want until they ask.

"One thing we're adamant about at St. Paul-Travelers is not 'shutting off paper' to agents," says Fiori, adding that some of the company's agents still do not have proper download capabilities in place. As such, functions such as billing and commission statements need to have a paper copy to supplement an electronic version because a number of agents don't have the ability to access these statements electronically, Fiori notes.

Moreover, where insurance companies may have once rolled out programs to the field believing they knew what agents wanted, savvy insurers are striving for collaboration.

At Safeco, more than 650 independent agents and brokers were instrumental in helping to design SafecoNow, advising the company on everything from the design of the sales platform to the streamlined home pages, says Ann Randall, vice president of automation for Seattle-based Safeco Personal Insurance. All told, about 7,500 agents on both the commercial and personal side have access to SafecoNow.

In conjunction with SafecoNow is the company's agent Web portal, EZLynx, a real-time rating system created by Flower Mound, Texas-based Webcetera. EZLynx removes the bridging step, cutting distributors' work time by as much as half.

"We are on a mission to make insurance sales less complicated for independent distributors," says Randall. "EZLynx can be a very powerful solution for agents and brokers."

A new perspective

MassMutual's Maury says the company was able to develop a stronger program once it had the input of its agents. "The previous incarnation of FieldNet was built from a 'home office' perspective. When we did this iteration, we turned it around and developed it from an agency perspective."

MassMutual executives visited with agents and watched what they had to go through to conduct business with carriers. Agents and their staff were constantly being interrupted when processing new business or servicing an existing account.

"They would have to close out of one application to enter a new one," Maury continues. "We developed FieldNet to enable them to multi-task. With this system, an agent can launch a new window on the Web site. On the previous versions of the Web site, if an agent was in the middle of doing something and was interrupted, they would have to close out of that application, back up and then return to the application and start over. It was very frustrating," he says.

Independent agents have noticed a marked difference in the relationship-building efforts that insurer-partners are embarking upon. But the problem is this trend has been erratic. Not all insurers have adopted such practices-at least not yet.

"Many insurers make decisions from the board room. One incredible thing about FieldNet is that MassMutual asked us what we needed to improve our electronic workflow processing, and we told them," Molyneaux notes.

Agents' Wish List Is Growing

Independent insurance agents are pursing two e-services agendas with carriers, one that has existed for the past two or three years, along with an emerging wish-list of new capabilities.

"The requirements agents have had over the years have always been high, but there's really been a higher degree of intensity over the past year," says Ann Randall, vice president of automation for Seattle-based Safeco Personal Insurance. "It's a make or break proposition: They want a competitive price on insurance products, but they'll pick their trading partners based on the efficiencies and workflow capabilities that insurers bring to the table."

In what appears to be a consensus among insurers, independent agents are seeking three core IT capabilities from their carrier-partners: Real-time policy information pulled from a carrier Web site and linked to an agency management system; agent-dedicated Web sites that enable them to access endorsements and payments, view policy, billing and claims information and e-mail quotes directly to customers; and around-the-clock Web-based customer support for policyholders.

Agents have indicated other electronic capabilities are on their radar screen. "Independent agents had been satisfied with basic e-services, but they have raised the bar over the past year," says Bruce Fiori, second vice president commercial operations, for the newly merged St. Paul, Minn.-based St. Paul-Travelers Inc. "Being able to download e-mail alerts, for policy or claims issues, has become one priority."

Real-time quoting has been an elusive capability for independent distributors, says Safeco's Randall. Without real-time quoting, agents must type customer information into comparative rating systems and then bridge to each carrier Web site to complete questions unique to each company's application process.

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