Given the continued improvement of technology and the advent of mobility in today's society, workers can now do their jobs teleworking from a remote location-be it in the comfort of their home office, the backseat of a taxi or even lounging in the sun while listening to lapping waves in a tropical paradise.

But what does the opportunity for teleworking mean for insurance companies? According to industry experts, many workers now have shifted their expectations from being cube-bound to being free to work wherever, whenever, based in large part to the progressive mentality of the incoming millennial generation (workers born approximately from 1981 to 2001). Karen Pauli, research director of the insurance practice at Needham, Mass.-based TowerGroup Inc., believes that not only do younger workers demand enhanced work/life balance, they're also more environmentally conscious than older coworkers. And with gas prices continuing to rise and employees looking to save money at the pump along with their hours stuck in traffic, these expectations are transcending generations and the demand for working remotely is higher than ever.

Regardless of this demand, many carriers still are slow to adopt telecommuting, Pauli says, saying it's lagging on their priority list behind legacy system replacement, which is monopolizing their already scarce IT dollars. Some insurers may allow certain roles, such as claims or marketing personnel, to work out of the office because it's traditionally accepted, and some bless specific individual's requests for teleworking, but many companies still have no formal teleworking policy in place and, some insiders feel, insurers need to gear up for potentially losing employees to competitors who allow them the lifestyle they desire.


One company that might as well have tumbleweed blowing down its empty corridors is Midwestern Family Mutual Insurance Co. Its Plymouth, Minn. headquarters is a greatly scaled-down ghost town since the company virtualized everything and sent its employees home.

Ron Boyd, president and CEO of the multi-line P&C insurer, says the company decided back in 2002 that it needed to change due to financial concerns related to statutory accounting. Midwestern Family, which finally sold its 24,000-square-foot office last year, was initially looking to become more paperless and put in electronic workflow methodologies but, as it discussed it more, the employees conjured up a wild idea and asked, "Why can't we just decentralize this and work from home?"

"It was the stupidest idea in the world when we first though of it, but the more we talked about it and studied how the technology would work, and because we had IT guys who were willing to test it and experiment with it, the more we thought it could work," Boyd says of the beginning of the company's radical transformation.

Since then, he's virtualized his entire operation. There's still a physical office, a 5,000-square foot space affectionately termed "the motel" because it's full of cubes that can be checked out on hourly, daily or weekly basis. The facility is kept as a hub for mailings and to store computers, and in case the employee lost Internet access and they needed a place to work. The office is capable of housing all 77 employees, but only two of those people-those responsible for opening and scanning the mail and routing it into the electronic workflow system-are ever present. A couple of employees might wander in for various reasons each day, or management might want to call a physical meeting there (Boyd says this is rare), but everyone is capable of doing their job wherever they choose.

All Midwestern Family employees have company-issued computers, and the key to them working is simply having access to the Internet.

Most of the company's teleworkers work in fixed locations, such as the underwriters, so they receive desktops, but marketing and claims employees use Blackberrys and laptops so they easily can be on the move.

Boyd reports that workers enjoy telecommuting from home, and has yet to lose anyone as a result. "I'm still searching for a downside to having everyone out of the office," he says. "We're starting to develop a 24/7 work ethic. When you can work in your backyard and you're not in a hurry to commute, the company is the beneficiary. There's no beehive mentality where you've got to get in and get out. Now, I see emails sent between 1:00 and 5:00 a.m., so I know there's work taking place at times where there was none before."


In order to affect this drastic change, Boyd revolutionized the technology within the company. "We use essentially three things," he explains. "We employ scanning and electronic workflow technology from CGI Group Inc. (a Montreal-based IT and business process services provider), and we are literally paperless. We route work electronically through that system, working through a common queue. We also electronically monitor work, logging keystrokes, transactions, log-in times, log-out times and Web sites visited."

In 2003, the insurer installed virtualization technology from Citrix Systems Inc., Fort Lauderdale, Fla., which allows the company to centralize all its computing as opposed to servicing individual computers on each employee's home site. Now, each teleworker's home computer is simply a dumb terminal as a result of Citrix.

"[Teleworkers] have no access to the data other than to see it," Boyd says. "With Citrix, all the data and applications are retained in a centralized location. When an employees logs into Citrix, their processor is really here in Plymouth. They have no processor at their location."

The last cog, he explains, was to install voice-over Internet protocol (VoIP), which allows employees to receive calls on their computer through the Internet, and make outbound calls through that same methodology by going through the switch at the home office.

"We have centered our technology at U.S. Internet Corp.," Boyd says, of the Minnetonka, Minn.-based provider of Internet and hosting services, which addresses the rest of his needs, from VoIP to disaster recovery.

"We're also in the process of deploying Microsoft.NET technology in our policy processing system, which we hope to have done by the end of the year, that will allow our agents to have some of these same capabilities by accessing our system through a browser," he says.


But what about larger companies that seek alternatives to completely cutting loose their workforce but still want to attract top talent and keep their employees happy?

State Farm has initiatives underway to do just that. While the company still has some teleworking employees who function out of the office the majority of the time, the insurer has devised a pod system in response to the need for attracting more experienced workers, which can be difficult when being headquartered in Bloomington, Ill.

In the pods, people work in a specific collaborative environment with the goal of leveraging each other's talents to meet and create the best possible products. State Farm currently has four of these pods across the country.

Courtney Selle, manager of systems at the company's Bloomington office, is in charge of the second pod located on the campus of the University of Illinois in Champaign. "There currently are four systems analysts," she says of her pod, which is responsible for the company's insurance applications on the Internet. "One worker is an employee who was looking to move from Bloomington to Champaign, so we managed to retain him. We also wanted to leverage talent from the area as well, and we culled talent from Motorola and Yahoo!, which had business arms in the area."

Selle typically visits the pod monthly, but she talks to them over instant message, and sits in on daily reviews over the Internet. "They all have cell phones, access to a conference room with a poly-con phone, and desktops with IM, which can interface with a projector in the conference room for daily code review that can be seen by the whole project team," she says.

She also says they're currently testing the capabilities of Microsoft Roundtable, which is a conference phone with a built-in camera that automatically focuses on the person speaking while offering room on the screen for written notes and PowerPoint.

While there's no timeline to have everyone completely teleworking, State Farm also introduced a "Systems at Work" concept throughout the company to aid employee mobility, which is a blend of a traditional-type office, collaborative and mobile setup that is currently done only in the office, but could evolve to offsite in the future.

"We like to have the mentality of working anywhere, anytime, where it makes sense to work," says Kate Martin, director at State Farm. "The traditional environment, where you were tied to a desk, makes it hard to be flexible. People need to collaborate now, both virtually and in-person."

The Bloomington office now has flexible collaboration areas with movable furniture where people are not assigned to a mandatory desk, but to a designated area instead. Each worker has a laptop, cell phone and Blackberry, and can pick up and move as needed.

"We also have people who, while not assigned to working in a collaboration area, are just simply mobile. They don't have an assigned desk and they go where they need to be," Martin says. "They always tend to be in meetings, so instead of having a desk or an office to go to, they just work from wherever they are. We have spots around our campus where they can work, called touchdown spots, that have tables, chairs, benches, etc., and the whole campus is wireless-enabled."

Currently, State Farm has about 200 employees who are completely mobile, and about 800 working in the collaborative environments.


Having seen these different methods of loosening the reins on employees, what's the best way for carriers to go about developing their own telework program?

Telework Exchange, Alexandria, Va., a public/private partnership focused on expanding the awareness and adoption of telework options, works primarily with the federal government (which mandated in 2001 that its agencies must begin teleworking) to expand its telework programs, but also aids the private sector and state and local markets to expand their programs.

Given the organization's experience in working with the government, Cindy Auten, general manager of Telework Exchange, has compiled a list of best practices that insurers may find helpful when looking to get their own program of the ground. "Some of the top federal programs started off by surveying their employees to gauge their interest in telework," Auten explains. "They then set up strict policies and guidelines for the program, and install a senior-level telework advisor responsible for managing the organization's telework program."

The idea behind telework isn't that it has to be all or nothing, she says; even a part-time arrangement may work best for a given position. "There are different types of telework," Auten says. "There's full-time, part-time and teleworking on an ad hoc basis. Getting this on a regular schedule can really benefit not only the company and its employees, but also the environment."

The tricky part for many insurers will be addressing concerns of eligibility. According to Auten, one way to do it is to follow the path of the Defense Information Systems Agency, which elected an opt-out telework program. This means every employee is able to telework until proven otherwise.

The next step is to establish pilot programs to test on smaller pockets of employees before opening it up to the entire workforce, and expand from there, she says.

Equally as important as the telework program is the technology enabling it. The best program can fall apart if employers aren't supported with the proper tools, so carriers must evaluate and understand what their employees need in their telework environment.

"Laptops are critical," Auten says. "The federal government is moving to 90% laptops in their agencies. Many companies are using VoIP and work cell phones. Web collaboration tools and video conferencing are hot topics, as they allow workers to see each other face-to-face or work on the same document. Many companies also are using Nortel Symantic solutions and VPNs, as well as remote access solutions, such as a Citrix."

TowerGroup's Pauli echoes this, adding another key for carriers is to use instant messaging to collaborate with remote workers.

One thing she isn't too concerned about, however, is security.

"Firewall technology has really matured, and has a lot to do with why carriers are currently considering [telework programs]," Pauli says, going on to note that many insurers are currently looking to vendors for assistance in this area. "There are experts who now have deep experience with this type of thing."


While insurers have plenty of reasons-financial and otherwise-to unplug their workforce and set them free to work from wherever they choose, there are myriad options for how to make employees lives easier, lessen commutes and expenses, and retain and attract talent.

"Carriers know that if you want to keep good people, you have to at least let them telecommute a couple of days a week," Pauli says. "Some of the more progressive carriers have recognized that this is a good way to utilize staff that wants to work only part-time, or who are relocating, because they can easily do that from a remote location. Carriers giving people options is really the key."

(c) 2008 Insurance Networking News and SourceMedia, Inc. All Rights Reserved.


As more employees grow weary of long commutes to and from work, their salaries remain flat while the economy struggles, environmental awareness fuels the nation's consciousness and prices escalate at the pump, the savings associated with teleworking makes it even more sensible for carriers and their employees.

The numbers don't lie: Cindy Auten, general manager, Telework Exchange, headquartered in Alexandria, Va., found in a study of the federal workforce that if workers teleworked just two days a week, they could save $3.3 billion of their paychecks, 73 million hours of commute times and 2.7 million tons of pollutants wouldn't be dispersed into the environment. In addition, they would significantly reduce their carbon footprint by not driving to work every day.

Midwestern Family Mutual Insurance Co., Plymouth, Minn., which has gone virtual and paperless and drastically downsized its physical office, slashed its paper consumption by 65% in five years.

"We're saving roughly 75% on natural gas and electricity for our office, and this is a conservative number," says Ron Boyd, the company's president and CEO. "Employees are burning 26,000 fewer gallons of fuel per year because they don't commute, not to mention the reduced insurance costs and wear and tear on their cars. We've equated this to about a $2,500 pre-tax increase in their income because they don't commute."

(c) 2008 Insurance Networking News and SourceMedia, Inc. All Rights Reserved.


As the cubes sit empty at the office, and employees smile while hitting the snooze button with impunity, how does management deal with having a remote workforce?

The message from Karen Pauli, research director at Needham, Mass.-based TowerGroup Inc., is that supervising remote workers requires a whole new management style. Some supervisors simply will not be good at it, she says, as managing remotely is a vastly different structure than what they're used to.

"It's imperative you have milestones on a daily and weekly basis, and that projects are well defined," she explains. "You don't want to find at the end of 90 days that the project went south because people were doing their laundry or mowing their lawns."

To get management acclimated, Pauli recommends training managers in project management skills, and getting their staff working on a project-basis.

"It's checks and balances, and making sure everyone knows what they need to be doing," she says. "It's scheduling routine, regular touch points. You can't just rely on having a staff meeting every two weeks. You need regularly scheduled touch points a couple of times per week."

Assuming management is comfortable with telecommuting, the remaining question is how do they know if their workers are actually working?

Ron Boyd, president and CEO of Midwestern Family Mutual Insurance Co., Plymouth, Minn., asks how management knows if employees are working when they're sitting in cubes outside their offices? His answer: "They don't. There's only one way to know, and that's electronically measuring work: measuring keystrokes, drafts issued, checks issued, policies written and all other activity. That should be the measurement."

From a customer service perspective, he says, where carriers have people who are on telephones during core office hours, they should calculate log-in and log-out times, the number of calls and the length calls.

"Because of the technology, the work environment doesn't matter any longer," Boyd says.

(c) 2008 Insurance Networking News and SourceMedia, Inc. All Rights Reserved.

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