Wausau Addresses Nuances of Middle Market Producers

As any P&C carrier will admit, meeting the ever-evolving needs of independent agents and producers is no easy task.According Gartner Group Inc., a Stamford, Conn., research firm, property/casualty insurers have "struggled with interaction and transaction inadequacies in their attempts to exchange information with their distribution partners, including agents and brokers, for more than 20 years."

Meanwhile, the rise in competition among agent networks, coupled with increased customer demands, keeps agents scrambling to maintain and grow business. The requirements of players-especially those in the commercial middle market-can be especially complex, as these producers demand effective and efficient system functionality.

Agents' "help me so I can help you" mantra is one heard loud and clear by Wausau Insurance Cos., Wausau, Wis. Founded in 1911 by a group of lumbermen to provide workers' compensation, Wausau is a national, multi-line property/casualty business insurer that offers a wide range of loss management services.

A member of the Liberty Mutual Group, Wausau began looking at its middle market process in late 2003. With accounts generating $75,000 to $2.5 million each in workers' compensation, property, auto, general liability and umbrella business for the insurer in 2004, Wausau has good reason to help its middle market producers.

Tackling requirements

"It came out of an overall driving initiative to make it easier for producers to do business with us," says Mike Lang, senior business analyst and project leader for Wausau's Producer Interface Program. "Although we knew it would be easier to do this in the smaller scope of the P&C area, the middle market was where we felt we needed to place our attention."

The 2003 study revealed the importance of not only improving Wausau's producer response time, it identified real-time transactions as a critical component of its middle market agents' prospects for success. The examination and ultimate game plan also included a way to maintain the delicate, complex, yet productive relationship with numerous third-party data sources.

"We recognized the need to improve efficiency of the entire quote process," says Lang, "and the solution would have to be an interface that would allow processing of real-time edits back to our producers' various agency systems."

Creating an interface that would allow the company to accept data submissions from agents using third-party systems such as those from AMS Services Inc., Bothell, Wash., and Applied Systems Inc., University Park, Ill., was a given, says Lang.

What the carrier really needed, however was a way to leverage the data agents were already using, and at the same time support file attachments, making the agent-carrier transaction completely electronic.

The result-Wausau's home-grown interface process-takes submission data transmitted directly from an agency management system, converts it into ACORD XML and sends it to Wausau's interface database.

Once at Wausau, the interface integrates with the carrier's policy management and workflow systems, providing access to such items as property valuations, vehicle schedules and exposure forms. Ultimately, the data feed triggers third-party resources for transmission back to the source.

Removing guesswork

According to Lang, using ACORD XML to craft the interface process that enables transmission of electronic file attachments such as financial reports, deductible plans or loss runs-is "the real rounding out of the middle market."

"We had a handful of proprietary interfaces prior to this," says Lang. "Following ACORD XML sets the stage for how to communicate." Lang adds that the ability to build an efficient nonproprietary interface removes the guesswork of dealing with a variety of different third-party data structures.

"By working with a language recognized by all parties, we knew our producers could quickly and easily implement," he says. "We didn't want it to take five weeks. We wanted it take one day."

Doug Johnston, executive vice president of Interface Services at Applied Systems, provides a simplified example of how the interface works.

"Agents or producers working in their agency system click on a real-time interface, which prompts a choice: Do you want to send one or multiple policies or applications to Wausau? If the agent chooses a commercial auto policy, he's given two more options: Send the current policy or the updated one with more information about some of the drivers listed on the commercial fleet."

This command generates an immediate confirmation, faster quote, and negates the need to re-key data.

"For the most part, agents already have the information in their systems," says Johnston. "This interface allows data to go from policy data in the agent's system to Wausau and back again in seven or eight seconds. I often ask our agents: Wouldn't you take eight seconds out of your life to conduct business this way rather than the 30 minutes you were spending to re-key?"

Trimming processing time couldn't come fast enough for middle-market producers, who conduct business differently than personal lines agents, says Hugh Anderson, director of Interface and Integration Solutions at AMS. "The uniqueness of the middle market submission process is that within commercial P&C lines there is a lot of underwriting done within key characteristics of a particular application," he says. "It's not always a real-time response workflow. It's usually a submission for an application for underwriting, so you won't avoid some of the manual workflow addendums, but the electronic submission kicks off a much more efficient process." Lang compares commercial applications with personal lines auto, which has a very straightforward approach to gathering and processing information such as name, date of birth, and motor vehicle identification number.

"It's not that simple in the middle market, where we have loss responsive plans, a host of vehicle schedules, and alerts to underwriting to highlight risk characteristics."

Anderson asserts that Wausau's interface is a direct reflection of a carrier recognizing and respecting the nuances of commercial middle-market agents and third-party systems.

"We deal with 200 carriers and five or six vendor systems," says Anderson, "Our Sagitta agents are big businesses," he says, "not only from the business point of view, but how they manage their technology. They are technically savvy and they can be demanding. They are demanding of us, and of their carriers. Wausau wasn't afraid to jump into this."

They have a choice

Lang remembers that the issues discussed during Wausau's interface project centered on the fact that, especially for middle-market producers, the goal was "not just about writing insurance and making money. It was about services, packages, and customer service."

Johnston believes recognizing one of the biggest untapped areas-interface technology-is also key. "In today's world with XML and all we can do to extend a message, a lot of people are going after that huge premium potential, Wausau included," he says. "But the bottom line is: At the end of the day, the busy customer service rep is simply looking for ease of doing business."

For Anderson, Wausau's success lies in its ability to recognize that agents have a choice. "They don't call them 'independent' for nothing," he says.

"Agencies don't pay a thing, and many have invested heavily in their systems-so creating an interface that leverages their existing data and workflow systems is a proven benefit."

Wausau maintains that 80% of its agents and producers are ready to use the new process, and since its introduction last year at this time, more than 35% are already using the new interface.

"Producer-facing capabilities are very big for us," says Lang, "because we support five lines of business. So we're telling our agents and producers, 'Look, it's easy, it's free, and it's going to guarantee accurate data,'" Lang says. "We are seeing progress. We are getting more buy-in at the agencies' principal level and we continue to market to that and the customer-service level."