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Nashville, Tenn.- HealthLeaders-InterStudy, a provider of managed care industry intelligence, finds that CIGNA HealthCare has turned a corner in North Carolina. According to the latest issue of the North & South Carolina Health Plan Analysis, the national insurer's North Carolina HMO license tripled its net income in 2004 yet decreased premium revenues by 21%. It was the most dramatic turnaround among North Carolina's HMOs. CIGNA's HMO posted 2004 net income of $18.7 million on revenues of $277.5 million, says Jane DuBose, HealthLeaders-InterStudy analyst. "That's a 6.8% profit margin." All of the state's HMOs were in the black in 2004, although UnitedHealthcare and Aetna Inc., two other national insurers, had lower net income than in 2003, DuBose says.Source: Decision Resources Inc.

The Lawson Firm, a Cleveland-based law firm providing legal services to the insurance industry, is offering a two-part paper examining the business and legal risks associated with business-process outsourcing (BPO) and the strategies used to manage those risks. The paper is in response to recent studies showing that roughly half of all insurers currently outsource one or more business processes, or are planning to do so within the next 18 months.

COLUMBUS, Ohio--Nationwide Financial Services, Inc., a leading provider of long-term savings and retirement products, today reported first quarter 2005 net income of $160.5 million, or $1.05 per diluted share, compared with first quarter 2004 net income of $119.6 million, or $0.78 per diluted share.

Insurance revenue reported to the Federal Reserve by the nation's bank holding companies grew by $7.3 billion in 2004 to $40.8 billion, 22% higher than 2003, according to an analysis by the American Bankers Insurance Association (ABIA), Washington, D.C.

The National Association of Insurance Commissioners (NAIC) May 2 launched pilot project with five states to store electronic fingerprints of licensed insurance producers.

Quincy, Mass.--eStudentInsurance.com, a service of the Edvisors Network announced this month a new partnership with Worldwide Insurance Services. The Edvisors Network, a multi-national education services company, teamed up with Worldwide Insurance Services, a global leader in travel insurance, to create a new insurance policy for students traveling anywhere in the world. Global Student Health plans from eStudentInsurance.com are designed specifically to benefit international and domestic students by offering optimal affordable coverage, anywhere in the world.

Moncton, N.B. Canada--Whitehill Technologies Inc., a provider of document composition and data transformation software, has acquired the technology assets of Metaserver Inc. With this deal, Whitehill now owns the patented technology platform behind Metaserver's suite of business process integration (BPI) software and solutions for the insurance industry.

As director of MetLife Auto & Home's special investigations unit, John Sargent knows that eliminating fraud is an unachievable goal. But that hasn't stopped his company or other industry leaders from trying."Our goal is to pay what we owe, and not a penny more or a penny less," Sargent says. "The more efficient we are at identifying and preventing fraud, the better we can be at writing business at a more competitive rate."

In some ways, insurers' fraud-fighting efforts are similar to this nation's so-called war on drugs: Both endeavors require the right mix of people, technology and information to identify the criminals. Also, public awareness campaigns are part of the effort to change consumer behavior, whether it's to prevent drug use or prevent policyholders from filing bogus claims. And both involve elements of organized crime that use sophisticated tactics and technology to perpetrate their crimes.However, despite all of the resources that have been dedicated over the past decade to fighting drugs and fraud, we're no closer today to eliminating either problem. There have been many high-profile successes for each campaign, whether it's the seizure of a ton of cocaine on a ship at sea, or the combined work of insurance fraud investigators and law enforcement officials to uncover a multi-state, staged-accident fraud ring. But the fact remains that insurance fraud continues to cost the insurance industry $30 billion a year-and that's just counting fraud perpetrated against property/casualty insurers.

With industry research indicating that many individuals don't understand their annuity and life insurance needs, the responsibility falls on insurers to provide product research and needs-analysis to customers.While meeting with a financial advisor is one way to educate customers, many carriers, such as New York Life, are enhancing their Web capabilities to reach customers directly. And their efforts are being noticed.

In a move to strengthen the services it provides to sponsors of defined contribution plans such as 401(k) plans, Nationwide Financial Services Inc. in April purchased a company that provides third-party money management services to plan participants.The company, Registered Investment Advisors Services Inc. (RIA), which is based in Dallas, has been providing investment management services since June 2002 to plans that are part of Nationwide's Best of America Group Pension Series programs. Based on that experience, Nationwide executives say tighter integration with RIA Services will provide plan participants with expert advice on how to manage their retirement funds, and it will enable Nationwide to expand these services to other plans.

Industry experts often criticize insurers as being "laggards" in adopting new technologies. But carriers are leading most other industries when it comes to adopting scanning and imaging technologies, a new study concludes.For example, 86% of insurers surveyed by AIIM, an enterprise content management association based in Silver Spring, Md., are using scanned documents and images to answer inquiries from customers, compared with 73% of companies across all industries. Furthermore, 60% of carriers use scanned documents to respond to litigation, compared with 45% of all survey respondents.

The Contracts Update section includes announcements of contracts insurance information technology companies have signed with customers in recent weeks. Contract news can be faxed to Insurance Networking News magazine at (312) 913-1366 or by electronic mail to Stephen.Dwyer sourcemedia.com Apres Systems Inc.

As Web services continue to move closer to mainstream acceptance for application development, new research indicates performance concerns now exceed network security issues as a factor that's limiting adoption.A recent study by RESolution Market Research found that service-oriented architectures and Web services, supported by XML, are regarded as a key choice for application development because of ease of programming and data interchange.

For insurance carriers, brokers and agencies, the ability to recover quickly from a systems outage or disaster is critical to their business-and, increasingly, may be mandated by law or industry oversight groups. As a result, business continuity has become a core management issue, whereas in the past it was an issue that was addressed by IT executives."The insurance industry is moving from recoverability toward resilience," says Ted DeZabala, national leader of Deloitte & Touche LLP's security services team. "This is a huge change of mentality, of management, and of technology for the insurance industry."

As an undergraduate at MIT and New York University, Dennis Callahan majored in mathematics. So, it's not so surprising that the CIO of Guardian Life Insurance Company of America has been so successful at focusing on the numbers at the New York-based insurance company.Since he took the CIO position in late 2000, Callahan has reduced the IT budget at Guardian by one-third-all while modernizing the entire corporate infrastructure.

When John Golden took control of IT at CNA Financial Corp. in late 2001, he faced the same challenges many CIOs are still grappling with: How do you transform diverse legacy systems into a modern platform that enables faster product development, better customer service, higher productivity and greater operational efficiency?After consolidating 20 IT groups into one, and focusing on the business value and total cost of ownership of IT systems and applications, Golden, in only a few years, has reduced the Chicago-based carrier's nondiscretionary IT expenses from $400 million per year to $200 million.

If it weren't for a bad case of writer's block, Michael Bernaski might be a famous novelist right now. Instead, he's the CIO and senior vice president of property-casualty e-business and technology at The Hartford Financial Services Inc.Last year, he accepted the senior technology position at the Hartford, Conn.-based financial services firm when he "hit the wall" trying to write a murder mystery during a year-long sabbatical from the consulting world. Bernaski had left Accenture, where he had worked for 15 years, to enjoy his newborn daughter and pen his way toward the best-seller's list.

At Erie Insurance Group, the foundation for fighting fraud is a business strategy that defines objectives, quantifiable goals, and tactical and operational plans: What is the company trying to accomplish? Does the company have enough resources to react to instances of fraud? How is Erie going to get better referrals to its special investigations unit and become more proactive in identifying fraud?"Erie is keenly aware that our experienced people-our claims adjusters, field investigators, intelligence analysts and information specialist-coupled with our use of fraud detection technology and investigation tools, have made our anti-fraud program so successful," says David Rioux, assistant vice president and manager, corporate security and investigative services for Erie Insurance Group, Erie, Pa.

In the aftermath of the terrorist attacks in 2001, many property/casualty insurers are now reassessing risk assessment strategies in metropolitan areas. As they do, the process involves looking deeper beneath the surface-literally.For example, how does an underground parking garage in Midtown Manhattan impact an insurer's risk position? Years ago, insurers that write commercial automobile insurance might have considered an underground parking facility to be a safe haven because autos were assumed to be better protected beneath street level.