No more scurrying down the hall to retrieve confidential faxes or fishing for lost pages? For the Leavitt Group, a Cedar City, Utah-based insurance firm that works with its affiliate agencies to provide risk management and risk transfer solutions, the death knell for traditional faxing may have sounded. Upon reevaluating its business processes and technologies, the insurer honed in last year on an area in which it could trim some fat: faxing. Since then, it has gradually phased out traditional fax machines and reaped the cost, convenience and structural benefits from Internet faxing, which enables users to send and receive faxes through their e-mail accounts or a secure online server anywhere they can get an Internet connection. In an industry teeming with small offices, independent workers and paper documents, the Leavitt Group’s group-wide standardization drive may not be an aberration for long.
“In the insurance industry, faxing is still an important part of the business,” explains Randy Wilson, an IT consultant in the Leavitt Group’s service division, who assessed the insurer’s cost and productivity challenges in its fax environment. The Leavitt Group typically sends and receives some 20,000 faxed pages per month in one of its busiest offices alone, either through a fax machine or fax server. Through Internet faxing, it has found efficiencies in myriad ways, from reducing the need for a gatekeeper to review and distribute faxes to hacking costs spent on phone lines, which, for faxing, each typically run $40 monthly in a remote office. It also slashed paper and toner costs.
The insurer had proposed network fax solutions — another popular option for those looking to shun stand-alone fax machines — in the past to some of its agencies, but because of upfront costs and hardware management issues, these solutions were too expensive, according to Wilson. Though hard figures are not available, “in almost every case, the hard costs are about the same or less by moving to MyFax, and the soft cost savings are huge,” he says.
With Internet faxing, no infrastructure needs to be built or operated, while pricing also is more straightforward, according to the report, “Analyzing Total Cost of Ownership for Internal vs. Hosted Fax Services,” by the Westport, Conn.-based consulting firm Robert Frances Group (RFG). Internet faxing is less expensive than fax servers due to the latter’s significant cost in areas such as licensing, personnel, implementation and integration. In its analysis, the firm found that, when sending 10,000 faxes per day (using three servers), a typical company’s annual fax server environment could cost $1,019,000, while in a similar scenario Internet fax services would range from $75,000 to $365,000—bringing an annual savings of between 49% and 64% for those choosing the latter option. At the same time, fax servers have greater hidden costs, “such as the requirement (or unknown existence) of shadow IT staff for support, and additional unplanned costs associated with development, testing and, especially, systems integration,” according to RFG’s study.
MyFax charges $10 per month (retail) per individual user. For $10, one can send 100 pages and receive 200 pages. Price scales by the number of pages and the number of users, and the more fax numbers the company adopts, the more it is charged. However, just as cell phone vendors provide free minutes, MyFax throws in a number of free pages for every fax number or subscriber.
For the MyFax service, the Leavitt Group was able to negotiate pricing and features. Besides MyFax’s cost, the Leavitt Group chose the supplier for its longevity, stability and customer support. It liked the entrenched position in the Internet faxing space of MyFax, which is now luring in more than 15,000 new subscribers per month. The vendor’s performance in various rankings also played a role. For instance, with perfect marks in the areas of ease of use and customer service, MyFax was ranked first among Internet fax companies in a report this year by TopTenREVIEWS Inc., an Ogden, Utah-based Internet publisher of reviews. The vendor also offers 24/7 tech support, which the Leavitt Group has called upon principally for training issues.
FLUID COMMUNICATION WITH AGENTS NOW POSSIBLE
While not mandating MyFax, the Leavitt Group quickly convinced its agencies with multiple locations to adopt the service. For instance, one of its agencies in the southwest has six separation locations. Rather than having to establish a fax line at every single location and have different fax numbers, the agency chose to simply use one main toll-free fax number for all its locations.
This enhanced simplicity in communication is important to many large insurers. “There is kind of a hydra in terms of hardware in the field-in agency offices, claim offices and in disparate carrier home offices,” says Craig Weber, SVP for Celent, a Boston-based research and consulting firm. “And I think the whole idea of bringing the fax under the Web umbrella eliminates a lot of concern about hardware [and] reliability.”
The Leavitt Group found that Internet faxing also could lift a big load off IT officials. Because its member agencies are spread out, the company’s IT department often struggled to keep all of its fax machines and fax servers running. With the ability to tell agencies the amount of money they are spending on fax lines, long distance and the upkeep of their machines, “it is usually very easy for me to show them that this is a very cost-effective solution,” says Wilson.
Solutions such as MyFax also give insurance executives, such as those at the Leavitt Group, greater peace of mind through improved organizational order and security, says Steve Adams, VP of marketing of Protus IP Solutions, the Ottawa, Ontario-headquartered parent company of MyFax. (For more, see the sidebar below right.)
FUTURE MOVES TO OPTIMIZE
While the Leavitt Group still continues to use other faxing solutions at some of its 115 locations, it ultimately aims to eliminate manual faxing. Though many locations eagerly have discarded the traditional fax machine, the insurer has encountered some resistance from the quarter of its independent agencies that are already using other fax software that, unlike MyFax, was pre-filling customer information, such as fax numbers. Further, unlike that software, MyFax software did not automatically attach or confirm the fax and attach back to that customer file in their vendor application. However, the Leavitt Group has been working with MyFax to set up that application so the remaining quarter offices can be integrated into the vendor’s Internet fax system.
Those agents using the MyFax software have given it positive ratings, as they enjoy faxing from their laptops at hotels, as well as other benefits, according to Wilson. "They love the fact that they get a confirmation back via e-mail, and all of their faxes come right to their e-mail. They love the fact that they are archived for a year on MyFax's server so we can get to them via the Web. And they just love the ability to have it—no software to install, no hardware to manage and no upfront costs."
Will then the rest of the insurance industry soon be similarly smitten by Internet faxing? Perhaps. Wither the fax machine? Doubtful.
There will probably always be instances when a sender just wants to plop paper into a machine, acknowledges Adams. But few obstacles may stop Internet faxing’s fast-paced adoption, save perhaps one.
“The most significant barrier is a lack of awareness of Internet faxing,” observes Adams. “It’s not a new technology, but it has only been in the last couple of years that larger companies have started to depend on Internet faxing as a critical function.”
Daniel Joelson is a freelance business writer based in Alexandria, Va.
To read about how another insurer reduced paper usage, search “When Paper is the Culprit” at www.insurancenetworking.com.
(c) 2008 Insurance Networking News and SourceMedia, Inc. All Rights Reserved.
Anybody Seen My Fax?
For insurance firms, faxing online can help soothe security concerns. Often, faxes are legal documents that demand private protection or signatures. With traditional faxing, a paper fax “sits up in a publicly accessible tray, or your clerk circulates it around the office glancing through the faxes as he goes,” says Steve Adams, VP of marketing of Protus IP Solutions, the Ottawa, Ontario-headquartered parent company of MyFax. “Having it arrive electronically seen only by the person who needs to see it — that is a big advantage.” To add an extra layer of security to its new Internet fax service, Cedar City, Utah-based Leavitt Group, set up a secure TLS connection so every data transmission would be encrypted to and from MyFax.
Solutions such as MyFax also can provide greater order to carriers eager to escape the chaos that can arise from a mushrooming paper trail. With MyFax, every individual broker or agent receives their own individual fax number, and a fax received at that number is delivered automatically into their e-mail as a PDF document. So faxes “are easier to archive, easier to store,” says Adams. “And for both sending and receiving, we provide automated reporting and tracking and online archiving so faxes don’t get lost—they have confirmation of whether it was sent or received.”
Vendors such as MyFax argue this also can help insurers better face compliance concerns. “I don’t know that any company that has gotten fined for use of a traditional fax machine, but anything that can help tame the paper beast has got to be viewed favorably by regulators,” says Craig Weber, SVP for Celent, Boston. “Automated workflow — electronic workflow — by its nature creates an audit trail. And regulators just have to really appreciate that; it gives them an insight that they never had before.”
(c) 2008 Insurance Networking News and SourceMedia, Inc. All Rights Reserved.
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