The insurance industry can't agree on a definition of the phrase "enterprise content management." Whatever it means, though, there's a consensus that it's improving.Many think of it as combining absolutely every kind of documented information the company owns and putting it into a paperless electronic central repository that imposes business rules, manages distribution and affords virtually unlimited access. That master file would house everything from this morning's jpegs to digitized versions of yellowing old paper-and-ink policies.

Contrarians might ask how that differs from "document management." Some complain about hearing the two phrases used interchangeably.

Others, including Matthew Josefowicz, insurance practice manager for Boston-based Celent LLC, would even prefer to banish the phrase "content management" as too broad to be useful.

"Enterprise content management can mean almost anything," Josefowicz says. "We tend not to use it."

Vendors can legitimately claim a role in enterprise content management with offerings as diverse as document automation; collaborative offering; document offering workflow; and imaging, archiving and retention, he says.

Celent prefers to limit the discussion to document management and goes so far as to break that down into two components: document automation, which is the production of documents, and document handling, which is the intake, indexing and archiving of documents and would include imaging, says Josefowicz.

No matter how one views content management or document management, storage costs are decreasing, while improvements are coming to database search tools, and to indexing and character recognition tools, says Josefowicz. Meanwhile, XML is making it easier to produce documents in multiple formats while retaining their logical formatting, he says. At the same time end-to-end coverage, the automation of an entire enterprise, is coming closer to reality, and commercial software is helping conglomerations of legacy systems communicate better, he says.

Still, no vendor has come up with a software layer that carriers can plug in and use to bring harmony to all of the systems that a company's various departments have accumulated in the last few years, says Jeff Lopato, e-business manager for commercial lines at Preferred Mutual Insurance Co., New Berlin, N.Y. Each company simply has too many differing business practices, he says.

That leaves insurers with the task of creating their own software to link legacy systems, says Lopato. It can be done, he says, noting that Preferred Mutual reached a state that the company considers paperless about a year ago. For most carriers, anything other than a homegrown system would simply cost too much because millions of dollars have already been invested in automating departments one-at-a-time, he notes.

Indeed, Josefowicz says he considers the switching costs to a large-scale system a "high hurdle" and advises carriers to look around the company to see what automating tools already in place could be used in more departments around the company-pretty much what Preferred Mutual did.

Occasionally, however, companies have the opportunity to start almost anew. Take the case of Diamond Insurance Group Ltd., a Schaumburg, Ill.-based workers' compensation insurer. The company was moving to new offices two years ago and purchased computer hardware with content management in mind, says Jay Smith, Diamond director of IT and human resources.

Diamond had to customize some aspects of the ImageNow software purchased from Perceptive Software Inc., Shawnee, Kan., but had no major issues, according to Kirk Meldrum, a Diamond systems analyst. The system was running in one department by January 2006.

A similarly smooth transition to document or content management software is taking place at Colorado Bankers Life Insurance Co. in Greenwood Village, Colo., says Mitch McCloskey, treasurer and assistant vice president of administration. The company chose ImageRight software from Advanced Solutions Inc., Conyers, Ga.

The same software also is going live at Louisiana Workers' Compensation Corp. (LWCC), headquartered in Baton Rouge, La., says Barrie Parker, chief information officer.

GETTING BETTER

In describing the move toward a paperless environment with the help of commercial software, IT people invariably praise "improved efficiencies" and "better workflow."

"In my mind, we just weren't very efficient," McCloskey of Colorado Bankers Life says of the days before content management. "The whole idea of taking a piece of paper and walking it around from person to person just didn't make any sense."

First among the efficiencies, perhaps, comes the recognition that electronic documents don't get lost the way paper files can. After dipping into a paper file, an employee can put it in the wrong place, but misfiling seldom happens with electronic systems.

Carriers also note that more than one person can use an electronic file at the same time. In the paperless world, they say, that just wasn't possible. "Now, 20 people are looking at the file at the same time in different parts of the company," says Jack Best, project manager for the LWCC ImageRight implementation. "You didn't have to wait to three hours to get your file, either. You can pull it up when someone calls you on the phone."

Another benefit of automation comes with speeding up the delivery of the mail inside a company, carriers say. Mail is scanned upon arrival and goes directly into the electronic mailboxes of the employees who need to see it.

After mail arrived at Diamond in the old days, it was opened and sorted and took an average of three days to reach an employee's desk. The company's employees in other states had to wait even longer for mail, says Smith.

Now that workers receive mail the same day it arrives at the company, they respond to customers within 24 hours, checks are mailed to customers in timely fashion, bills to vendors are paid promptly and workflow is spread out instead of concentrated in a 3 p.m. dump of paper mail, continues Smith.

"You're dealing with today's work today instead of having a constant backup of mail and being behind the eight ball," Smith says of the electronic mail.

At LWCC, mail was sorted in the mailroom and then went to the departments, where it was sorted by team and then sorted again to the individual, says Paul Buffone, assistant vice president of risk management services. Sometimes, a supervisor might hold up the mail for another few days before it reached the stack on a claims rep's desk, he says.

Similar efficiencies come with the automation of faxes, e-mail messages and batch reports. Instead of printing faxed messages on paper and routing them to employees, the information remains electronic and goes directly into the relevant folder and is routed simultaneously to everyone who needs to see it, says Diamond's Smith.

Besides improving communications within a company, automation eases communications with agents, says McCloskey of Colorado Bankers Life. Answering an agent's question or processing an agent's change used to take 15 to 20 minutes and now it's accomplished in 30 seconds, he says.

The same goes for dealing with at LWCC, the company says. The savings can mount up when providing detailed claims information to external attorneys or claims examiners. LWCC and external entities can now pass medical records back and forth at the touch of a button, rather than invest time and money in mailing costs and handling by clerks.

Automation also can make the difference when carriers deal directly with the public, says McCloskey of Colorado Bankers Life. His company began taking applications directly from customers over the Internet late last year. Soon, the information that customers provide online will be imported directly into electronic form, eliminating the need to re-key, he notes.

Government agencies and the courts also demand good communications, says John Mancini, president of AIIM, the Enterprise Content Management Association, in Silver Spring, Md. In fact, in the last three to five years, the need to comply with state and federal insurance regulations, as well as legal obligations to produce documents for e-discovery during litigation, have helped drive the switch to content or document management, he says.

Regulators or litigants who want to see a carrier's records can't demand perfection, Mancini says, but they do expect sound processes with a reasonable chance of retrieving the right documents in a timely fashion.

Having the right information readily at hand can require backscanning old documents into the electronic system, carriers say. When Diamond was going paperless, workers scanned in policies going back five years, even if they were closed, Smith says. "That was a labor-intensive job," he says, "but it was worth the time it took."

LWCC also likes having older documents ready for access. In the claims department alone, the carrier needed four months to backscan nearly 4,700 files with more than 3.5 million pages going as far back as 1992. That doesn't count the 28,000 files now being backscanned on the policy side.

DEPARTMENT BY DEPARTMENT

Carriers agree that introducing document or content management one department at a time can minimize the shock of change. Diamond and Colorado Bankers Life both began by automating policy processing departments. LWCC started with claims. After initial successes, all three have rolled out automation to other departments.

"We went in stages based upon not only our need but also our employees' willingness to embrace a cultural change from paper to paperless," says Diamond's Smith. Employees generally overcome their initial problems with the changes, carriers say.

"When we first brought it live, I would say in the first week our productivity dropped by 50%," says Colorado's McCloskey. "People under 30 were more productive in five or six days. For some people over 50 it took six months to get used to dealing with applications that were not paper."

"Some people just couldn't let go of the paper," says Smith. "So they were using paperless and paper folders at the same time. Positive peer pressure eventually made them realize paper was no longer necessary. Within eight to 10 weeks everybody who didn't take to it immediately had finally given up the security blanket of paper files."

"Initially the claims department was skeptical," says Parker of LWCC. "They were used to having paper in their hands." Once they were convinced the documents were the same on paper and online-and then realized the advantages of electronic versions-they were won over, he says.

Parker also says the buy-in proved easier because the system mimics the old way of doing things. "If you ask them today if they want to go back to paper, the would universally and categorically say no," he says.

Besides cultural challenges, the carriers sometimes had to overcome hardware glitches. At Diamond, for example, employees had to get used to the settings on the scanners. Several companies say they experienced a few false starts with persuading differing systems to communicate.

GOODBYE FILE CABINETS

Whatever challenges popped up, insurers seem pleased overall, especially when they describe offices where once-bulging file cabinets sit empty, while desks formerly stacked high with paper folders and incoming snail mail now look nearly pristine.

LWCC used to use buckets to haul reams of paper back to the files. "The buckets are still there but they're turned upside down now," says Parker.

Then there are the cost savings. Colorado Bankers Life began the march toward a paperless society four years ago, says McCloskey. Though not all of the changes came from content management, the company evolved from 75 employees and 68,000 policyholders at the end of 2001 to 58 employees managing 90,000 policyholders at the end of last year.

At LWCC, seven months into using the system, dollar savings have yet to be pinpointed, executives say. Some clerical jobs have disappeared, but the company has yet to determine the dollar value of all the changes wrought by automation at LWCC, leaders of the movement there say.

One thing carriers seem sure about, however, is the importance of making content management technology serve the business side of the company. "A big mistake people make is that they think of this in the early stages as technology or vendor questions," says Mancini of AIIM. "It's really a business question: What are you trying to do?"

Lopato of Preferred Mutual says some IT departments work on a situation-by-situation basis. If that's happening, he advises, work hard at keeping the bigger picture in mind. Whenever possible, he says, sit down with the business side and work on a series of strategies.

McCloskey of Colorado Bankers Life sums up his view this way: "If you want to grow and if want to look at other markets-like Internet-based applications with consumers applying direct - you have to have a system like this or be at a competitive disadvantage."

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