Boston — State filing (along with poor technology) is frequently a bottleneck for the entire product development process, according to a Celent report. However, newer Celent research—“State Filing Best Practices: Technology, Process, and Organization”—shows that some insurers are improving their processes, and technology plays a large role.
In recent years, insurers have made greater investments in technology to support many of the steps within the product development process. But one area that has seen relatively less investment is the crucial last step: the state filing. An insurance company’s state filing staff must assemble the right set of forms and supporting documents to meet each state’s frequently different requirements, as well as working with actuarial and legal staff to make the way the product is priced and functions conform to other unique requirements that also often vary state-to-state. An important contribution has been made by the System for Electronic Rate and Form Filing (universally known as SERFF), which enabled electronic filings in nearly all lines and in all states and jurisdictions.
SERFF’s intent was to provide a cost-effective, electronic method of handling insurance policy rate and form filings between regulators and insurance companies. Developed by the National Association of Insurance Commissioners, the concept for SERFF traces back to the early 1990s, yet is just now becoming widely used.
“It’s been around for awhile but, just recently, some states began mandating its use,” Kevin Christy, R&D manager at Edina, Minn.-based Western National Mutual Insurance Co. told INN in March. “It really took off last year.”
Christy says he generally is happy with SERFF, and is especially happy that he no longer has to wait for mail to be delivered. “The turnaround times are faster now,” he says. “It’s an improvement. We probably have more than 300 filings a year between rates and forms and new introductions.”
Yet, certain states require SERFF filings while others don’t.
One insurer working with SERFF, Celent reports, is Allstate Insurance Co., Northbrook, Ill.
Until 2002, Allstate’s filing process was entirely paper-based, the report states. The company was initially wary of adopting an electronic approach, partly because of concerns about the security of product information. But faced with an increasing number of states mandating the use of SERFF, two staff members began using the system for filing on a part-time basis. However, without a dedicated forms repository, the process remained fairly cumbersome: filers had to scan in paper copies of forms, send them to SERFF and retain those forms as records. In October 2004, the company began to implement Skywire Software’s Tracker system, and had it running by March 2005.
Since deploying Tracker, Allstate Insurance has reduced not only the time it takes to file, but also the average time required to receive department of insurance (DOI) approval, according to Frisco, Texas-based Skywire. The company's filing department is now able to submit DOI forms sent by product development teams—on average—in one day, a drop from an average of five to six days prior to the deployment of Tracker. It also obtains approval for a product in all 50 states in 44 days, on average.
"With Tracker we're able to automate the preparation and submission of state filings," says Bonnie Whittman, director of state filings at Allstate Insurance. "This has enhanced our ability to streamline the state filing process and bring new products to market quickly. The insight we have gained by using T acker to monitor the entire process also has given us great insight into overall performance, and allowed us to better utilize staff resources."
Technology is just one element of state filing best practices, according to Celent. The research firm provides a checklist for state filing best practices:
• Meet each DOI’s filing requirements the first time with a knowledge base that is:
• Meet each DOI’s statutory and regulatory requirements (almost always) the first time, by knowing:
Relevant statues, regulations and bulletins
• Use effective technology
Centralized repository of filings and support documents
Eliminate duplicate data entry
Workflow for improved consistency and better user experience
Integrated with SERFF and with insurer’s systems/databases
• Continuous improvement
Periodically review operations to identify improvement opportunities
Time to file/approve
Approval percentage (initial or subsequent)
Sources: Celent, Skywire Software, INN archives
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