Dublin, Ireland - Business process outsourcing (BPO) in India is growing within the insurance industry, driven by increasing comfort with BPO vendors and the need to reduce costs, reports Research and Markets, a Dublin research firm. Though the adoption of BPO for core insurance services is progressing slowly, the market has grown to almost U.S.$3 billion by 2006, says a new Research and Markets report.

Disposal represents one of the biggest points of failure in computer asset management because companies just don't know how many assets they have, where they are located, who's using them or what specific data resides on them, says Gartner analyst Frances O'Brien."Unless you know that information you're at risk from Day One," O'Brien says.

Forget the stereotypes--ASP isn't just for small, IT-challenged carriers any more, and many of the ASP problems that gave insurance companies pause only a few years ago are being solved. Dollar savings and fast time to market are still big pluses for ASP, but today there are a lot of other reasons to consider it.The market among insurance carriers for ASPs, or application service providers, is growing by about 10% a year-slower than in most other industries-according to Marc Cecere, vice president and principal analyst for Forrester Research in Cambridge, Mass. From a supply-side perspective, that's partly because of the structure of the insurance industry and partly because of the regulatory scene for insurance companies.

CANAL SELECTS TRUMBULL FOR SUBROGATION MGT.Canal Insurance Co., Greenville, S.C., entered an agreement with Trumbull Services, Windsor, Conn., to use Trumbull's Subrooutsource, an internally developed, advanced system designed to enhance subrogation recovery activities for all lines of business nationwide. Trumbull, in conjunction with an experienced subrogation team, will manage the entire subrogation process, leveraging the system's abilities to increase recoveries through effective resource allocation, automated workflows and a continuous improvement model.

Dublin, Ireland – Many of the services required by businesses including human resources, billing and transactional processing, may be entirely peripheral to its core competencies, according to research from Dublin, Ireland-based Research and Markets. Using a business process outsourcing (BPO) provider can help reduce costs while at the same time allowing the enterprise to focus on its core business.

Around the world, CEOs at insurance companies are slowly coming to the conclusion that they need smoothly running IT departments if their companies are to remain competitive. As a result, IT projects and budgets are getting some respect and are becoming less likely to fall victim to arbitrary cuts, according to analysts in North America, Europe and the Asia-Pacific region.The newfound respect is coming at a time when IT departments face intense regulatory pressure in Europe-and tamer but still formidable rules in the United States, China and Japan, according to reports from Boston-based Celent LLC. Pressure also arises from the need to service customers and distributors in real-time transactions and with rapid information flow, Celent says. Those functions can strain internal legacy systems, prompting insurers in mature markets, such as the United States, Europe and Japan, to update communications systems and core data environments.

The road seems less bumpy these days for insurance carriers that use state-of-the-art automated compensation to calculate and track agents' commissions. A single streamlined third-party system can replace a hodgepodge of legacy software and manual processes, users say, helping to reduce clerical work, increase accuracy and improve reporting. Moreover, carriers report that the software opens up a whole new world of analysis that pinpoints the true sources of profit and helps identify and retain the best agents.The accuracy rate for commissions at Blue Cross Blue Shield of Florida, for example, has improved from 80% before introducing up-to-date automated compensation to 95% after the implementation, says Linda Lamb, BCBSF vice president of sales business management. The remaining errors arise from data entry miscues or software problems outside the system, she says.

RECORDING SOFTWAREWitness Systems Inc., a Roswell, Ga.-based global provider of workforce optimization software and services, enhanced its Impact 360 IP Recording solution, featuring tripled channel capacity, unified recording management and a centralized administration tool. Designed for interactions in enterprise and contact center environments, Impact 360 now features TDM and IP recording under a single management tool. The software operates across IP, TDM and mixed telephony networks, designed to help customers ensure all their calls are recorded, whether for compliance and liability, sales verification or quality assurance purposes. Impact 360 IP Recording allows the recording of SIP-based calls. Also new to Impact 360 IP Recording is tripled channel capacity, which results in fewer servers. The solution introduces centralized administration capabilities, which provide access to all the vital Impact 360 IP Recording configuration settings, enabling customers to centrally manage all of their Impact 360 recorders regardless of location.

It's the same old adage: a penny saved is a penny earned. For many insurers, that means a boost in 2007 outsourced services. But for an up-and-coming group of carriers, that penny translates to a one-pence, kroner, deutsche mark or Euro.Across the globe, interest in business process outsourcing (BPO) services continues to increase, chiefly because insurers must continue to seek ways to achieve operational efficiencies and take advantage of growth opportunities.

Fantasy: convinced by your technology vendor that its bleeding-edge policy administration system will seamlessly integrate with your existing network and infrastructure, slide like butter down your users' palates and establish record turnaround time for processing efficiencies, you sign on the dotted line. You even astutely craft your acceptance speech for your company's upcoming "Highest ROI" award. Everyone loves you—even your agents.Reality: Two years later, implementation continues to slog at a snail's pace, the systems won't talk, your team is overworked, the vendor has been bought by a behemoth that has lost you in the shuffle, and your boss, users and other stakeholders are screaming. You are stuck.

GRAIN DEALERS UPGRADE POLICY ADMIN CAPABILITIESGrain Dealers Mutual Insurance Co. upgraded its policy administration capabilities with Policy Decisions from Insurity, a Hartford, Conn.-based ChoicePoint company. Policy Decisions is designed to incorporate complete policy-lifecycle administration services-from application intake to rating and underwriting, from policy issuance to renewal and reinsurance-on a single Web services platform. Grain Dealers looked at competing systems that promised improved access, says David Patterson, assistant vice president and director of Information Services for the Indianapolis-based property-casualty insurer, but Insurity had several advantages that clinched the deal. At first, agents will access it to do their own quoting for commercial policies. The longer-term plan is to provide self-service access to agents for policy maintenance.

NASHVILLE, Tenn. – The nation may remember 2006 as the year the Democrats won the mid-term elections, Gerald Ford and James Brown died, and data breaches made an indelible mark on American business in general and the insurance industry in particular.

Chicago - Chicago-based insurance broker Aon yesterday became the latest in a series of companies to participate in technology mergers as it announced its intent to acquire Valley Oak Systems (VOS), a San Ramon, Calif., provider of claims management software, services and support for the insurance industry. The acquisition reflects Aon’s desire to supplement its risk management portfolio. Valley Oak, winner of the IASA 2006 Technology Achievement Award, is best known for its iVOS system, which includes medical bill review, policy underwriting, case management, billing and event management capabilities. "Aon's acquisition of Valley Oak Systems continues Celent's predicted roll-up of the insurance software industry,” says Donald Light, senior analyst with Boston-based Celent, LLC. “While most acquisitions of independent insurance software vendors have been by larger software vendors, such as Milwaukee-based Fiserv buying Insureworx, Oakland, Calif., this time it is a major broker doing the deal.” The purchase InsureWorx, a policy and claims administration technology provider, gives Fiserv an end-to-end policy and claims administration offering for workers compensation. Other recent mergers in the insurance technology space include the San Diego-based Websense Inc., acquisition of PortAuthority Technologies, Inc., Palo Alto, Calif., and Ra'anana, Israel, for approximately $90 million in cash. PortAuthority will combine its information leak prevention technology with the "ThreatSeeker" malicious content identification and categorization technology from Websense. The deal will create a single source for companies looking to prevent the unauthorized use or disclosure of confidential data while simultaneously protecting users and data from external malicious threats. The Aon-VOS merger will benefit Aon’s unique position as a large brokerage firm. By integrating and sharing data with RiskConsole, Aon’s RMIX offering, the Aon-VOS deal enables the Chicago broker to create what the companies claim to be the only end-to-end browser-based offering in the marketplace. The acquisition of VOS follows a similar deal cut in 2004 by Aon’s with Risk Laboratories, LLC (RiskLabs), Marietta, Ga. Aon expects to consummate the VOS deal by January 31, 2007. Light believes that, from a marketing and sales perspective, the acquisition makes sense. “Valley Oak's customer base includes a great many risk management units in large employers who self-insure workers' compensation,” he says. “Aon's brokerage business targets that same group of risk managers. Aon's challenge will be to give Valley Oak the resources and freedom to keep its offering fresh and valuable to self-insured employers, as well as other customers such as insurers and third party administrators." Sources: Aon, Celent, INN archives

Dallas – Boston-based Blue Cross Blue Shield of Massachusetts (BCBSMA) has decided to use Premium Payor Services from Zix Corp. (ZixCorp). ZixCorp's Premium Payor Services provide access to future value-added services and deliver enhanced reporting for both payors and providers, aiding in analysis for incentive program initiatives.The Premium Payor Services funding model, which is in addition to the annual subscription fee per prescriber, is typically one dollar per qualified script processed or, as in this case, a flat fee license based on historical usage patterns calibrated to yield a similar amount.

The National Association of Insurance Commissioners (NAIC) is urging Congress to create a Natural Catastrophe Commission that could establish a disaster fund, strengthen and enforce building codes, and provide community support.

Washington – If lawmakers such as Sen. Trent Lott, R-Miss., and Rep. Cliff Stearns, R-Fla., as well as the National Automobile Dealers Association (NADA) get their way, insurance companies will be forced to disclose total-loss vehicle claims information to the general public. Thanks to catastrophic storms such as Katrina and the recent flooding in the Pacific Northwest, the public is more aware of the problem of flooded and totaled vehicles being resold to unsuspecting buyers. Lawmakers believe that a rule mandating disclosure of total-loss vehicles is one way to manage the problem. In the 109th Congress, Lott and a bipartisan list of colleagues sponsored S.3707, the Passenger Vehicle Loss Disclosure Act, to require that insurance companies permanently red-flag totaled, flooded or stolen vehicles. Rep. Stearns introduced a similar bill, H.R. 6093, in the House of Representatives. Seattle-based PEMCO Insurance last month announced that it voluntarily reports cars totaled with flood damage to CARFAX, an auto database available to consumers. Other insurance companies are expected to evaluate their reporting procedures. Sen. Lott also affirmed his plans to reintroduce legislation in the 110th Congress to reduce title fraud and title washing of insurance-totaled vehicles. According to lawmakers, although an insurance company may declare a vehicle a “total loss” due to water damage, severe accident, theft, etc., these vehicles often are sold at salvage auctions. They are then rebuilt and re-enter the market with clean titles, so consumers, wholesale auto auctions and dealers may have no way to learn about the total loss. The bill would require insurance companies to reveal the reason for the total loss (flood, collision, stolen, etc.), the date of total loss, the odometer reading on that date, and whether or not the airbag deployed. The NADA-supported effort by lawmakers would permanently red-flag these vehicles, reducing the likelihood that the “total loss” vehicles will end up back on the street. This federal legislation would not preempt state titling laws or require changes in state laws. “With more than five million vehicles totaled by insurance companies just last year -- more than half a million of them coming from the Gulf Hurricanes of 2005 -- something has to be done to permanently notify consumers about these severely damaged vehicles," said David Regan, Vice President of Legislative Affairs for NADA, McLean, Va., was quoted as saying. Sources: PR Newswire, Yahoo News, The National Automobile Dealers Association

New York - American consumers want electronic copies of their medical records and believe that having greater access to their information will reduce medical mistakes and costly repeat procedures, according to a new survey commissioned by the Markle Foundation, a New York research organization. But eight in 10 Americans are very concerned about identity theft or fraud and the possibility of their data being used by marketers without their permission - with three-quarters of those surveyed saying the government has a role in establishing privacy and confidentiality protections for electronic health information. For one of the custodians of consumer health care, health insurers, a cost/benefit analysis may involve deciding which is worse: the legal and potential business-loss ramifications incurred if a health insurance policyholder's private information is lost, or a potential regulatory chokehold on the management and transmission of a policyholder's data. In either case, as health insurers face increased scrutiny as one of the many "gatekeepers" of private consumer information, they also understand the importance of "big picture" thinking when it comes to doing whatever is possible to promote patient health. Companies such as Harvard Pilgrim Healthcare (HPHC), a 25-year old provider of health insurance products to more than one million members, has taken painstaking efforts to protect its customers information while making certain data is securely available to policyholders' caregivers. The Wellesley, Mass., not-for-profit company's mission statement--to be the most trusted name in healthcare-means the company must provide secure data access to HPHC's internal work force of 2,200 users as well as to a growing number of constituents, including 130 hospitals and 22,000 physicians. "Americans understand that quality of care could improve and costs decrease when their health information is available over the Internet to them and those who care for them," said Zoë Baird, president of the Markle Foundation, which funded the research. "And they are clearly ready to do their part to improve our health care system. But consumers also have significant privacy concerns, which must be addressed if we are to have sufficient consumer confidence to support a national commitment to electronic health records. People expect the federal government to establish rules that protect electronic personal health information from being used inappropriately." The survey, conducted by bipartisan polling firms Lake Research Partners and American Viewpoint, shows that: *97 % think it's important for their doctors to be able to access all of their medical records in order to provide the best care; *96 % think it's important for individuals to be able to access all of their own medical records to manage their own health; *Two in three Americans (65 %) would like to access all of their own medical information across an electronic network. This interest spans demographic groups - with a majority (53 %) of Americans 60 and older and high proportions of minority groups expressing interest; *When given the scenario of changing doctors or moving to a different city, an even greater majority - 84 % - said it would be important for them to have electronic copies of their medical records that they keep and control; and *Three-quarters of Americans are willing to share their personal information to help public officials look for disease outbreaks and research ways to improve the quality of health care if they have safeguards to protect their identity. The survey shows that large majorities of Americans see a number of benefits from accessing their medical information online. Consumers say they want access to their medical information in order to ensure that it's accurate, to improve doctor-patient communications and to help prevent medical errors. *91 % say it's important to review what their doctors write in their chart; *88 % say online records would be important in reducing the number of unnecessary or repeated tests and procedures they undergo; *82 % want to review test results online; and *84 % would like to check for errors in their medical record. Americans also see ways in which they could gain more control over their health care by making use of personal health records: *90 % say it would be important to track their symptoms or changes in their health online; *83 % of parents would be interested in using a network to track their child's health, such as tracking dates for immunizations; and *68 % say having their information available online will give them more control over their own health care. "It is encouraging to see that so many Americans recognize the opportunity to improve their health care - and their own health - by accessing and using their health information," said Carol Diamond, M.D., managing director of the Markle Foundation Health Program. "People not only want to see their medical records, they want to use the information to communicate with their doctors and be more involved in managing their care." While the survey notes high recognition of the benefits made possible by accessing personal heath information electronically, most respondents express concern that their medical information could be misused: *80 % say they are very concerned about identify theft or fraud; *77 % report being very concerned about their medical information being used for marketing purposes; *75 % say the government has a role in establishing rules to protect the privacy and confidentiality of online health information; *66 % say the government has a role in establishing rules by which businesses and other third parties can have access to personal health information; and *69 % say the government has a role in encouraging doctors and hospitals to make their personal health information available over the Internet in a secure way. "Despite the overwhelming interest in being more active participants in their own health care, and having their medical information available online to themselves and their physicians, Americans have very serious concerns about the privacy and security of their medical information," said David Lansky, Ph.D., senior director of the health program at the Markle Foundation. "People want to have control over whether their data are used for non-medical purposes and expect the government to establish rules that will protect them." Connecting for Health, a Markle-operated collaborative group of more than 100 organizations, released a new white paper to stimulate national discussion on the use of information technology to meet the critical needs of consumers, patients, and their families. The report describes a networked health information environment in which consumers could establish secure connections with multiple entities that hold personal health information about them. "It is difficult for a consumer to manage her personal health information since it is scattered among various organizations such as insurance companies, pharmacies, hospitals, etc.," Lansky said. "Several projects are currently underway to deploy personal health records, which are designed to help individuals manage their electronic personal health information. But because our health care system is so fragmented, and your health information is typically held by many unconnected entities, these electronic applications today struggle to provide a convenient way for consumers to access all of their data." The paper begins with a brief discussion of how consumer participation in networked environments has transformed other sectors, such as travel and finance. It contends that the health care sector would benefit greatly from a properly designed secure network that enables consumer participation. For more information, go to www.markle.org. Source: The Markle Foundation, INN archives

London - In order to better manage risk in an insurance business cycle fraught with uncertainty over market conditions and pricing, carriers in the U.S. and abroad should invest in the latest risk management tools, says a new report from Lloyd's, "Managing the Insurance Cycle." Lloyd's, which provides specialist commercial insurance coverage to customers in more than 200 countries and territories, published the report as part of its 360 Risk Project, an initiative to generate discussion on how best to manage risk in today's business environment. The report warns of "considerable uncertainty remains over prices and conditions in the commercial insurance market following last year's record hurricane season." Among other suggestions, it cautions underwriters to beware of the tendency to follow on market trends, and reminds them that "disciplined insurers... are prepared to walk away from markets when prices fall below a prudent risk-based minimum." Investing in state-of-the-art risk management and measurement tools, says Lloyd's, will support insurers' ability to create the best possible pricing models, as well as their ability to update them regularly to reflect the latest scientific evidence. "The models should more easily permit sensitivity analysis to show the impact of the many assumptions that are being made by the modellers on the insurer's behalf," notes the report. Lloyd's report cites "seven key steps for ensuring that the industry becomes less unpredictable and underwrites on a sustainable basis for the benefit of both policyholders and insurers," including: -- Don't follow the herd. -- Invest in the latest risk management tools. -- Don't let surplus capital dictate your underwriting. -- Don't be dazzled by higher investment returns. -- Don't rely on 'the big one' to push prices upwards. -- Redeploy capital from lines where margins are unsustainable. -- Get smarter with underwriter and manager incentives. More information onLloyd's report is available at www.lloyds.com/360. Source: Lloyd's

New York - Driven in part by increased demands from regulatory and rating agencies, enterprise risk management (ERM) has become integral to insurers' business processes around the world. Sixty percent of survey respondents explicitly factor risk management considerations into their decision-making, according to the fourth biennial survey of risk and capital management practices among insurers worldwide by the Tillinghast business of Towers Perrin. Conducted in summer 2006, the study of executives from more than 200 insurance and reinsurance companies around the world focuses on a number of issues, including risk measurement, quantification competencies, how companies calculate and use economic capital (EC), risk reporting and areas where the global insurance community is seeking to improve their risk management capabilities. In addition, a special section has been included that focuses on the impact of Solvency II on the European community. Key findings from the study: * External pressures are raising the bar for risk management globally. While most companies globally (78%) cite "good business practice" as the principal driver for their current risk management efforts, rating agency considerations are a significant factor for North Americans (72%) whereas changes in insurance solvency regulations are a major driver for European Union insurers. * Two-thirds of the insurance industry globally uses EC as a risk quantification tool. This is a significant increase over 2004 where only half of the respondents indicated they were using EC. * A further 19% of the participants indicated they are considering the use of EC. * Insurers are using a diverse set of risk metrics. Insurers assess the impact of risk on their capital, value and earnings in a variety of ways, with 63% using at least three differing measures. The most common are statutory or regulatory capital and surplus (56%), economic value (42%) and GAAP or IAS measures (38%). "Companies are clearly more disciplined in their use of ERM today than ever before, as catastrophic events, capital efficiencies and competitive pressures have driven companies to adopt less of a 'seat-of-the-pants' approach to risk issues," said managing director Tricia Guinn, who oversees both the Tillinghast and Reinsurance businesses of Towers Perrin. Risk Management Raises Its Profile "As risk issues have gained importance, so has the role of the chief risk officer," said Prakash Shimpi, Practice Leader with global responsibility for ERM. "Insurers are not only examining risk more closely, but they are also holding executives more accountable for the results." Almost half of the respondents (43%) report having a chief risk officer (CRO) with primary responsibility for risk management, up from 39% in 2004 and only 19% in 2002. The study also indicates that risk management is gaining importance in board rooms, with nearly all respondents (92%) reporting on risk to their board of directors at least annually, up from 84% in the 2004 survey. 53% of all respondents report at least quarterly to their board. Risk reports to senior management have become a common practice, with 39% reporting monthly and another 35% reporting quarterly. Risk reporting varies regionally: * Bermudian (89%) and Canadian (82%) insurers are more likely than U.S. or Asia/Pacific companies (53% respectively) to report quarterly on risk to their boards. * European life insurers (65%) and p/c insurers (60%) are twice as likely to report to senior management monthly as their North American counterparts (31% respectively). Solvency II Shapes Risk Management European insurers generally agree that the new Solvency II regime will require significant improvements to their risk management capabilities, including enhancements to risk quantification capabilities (63%) and enhancements to actuarial and accounting tools (59%). However, there are markedly different results between continental Europe and the U.K. in their approaches to Solvency II which is not surprising given the U.K.'s ICAS regime: * Enhance risk quantification capabilities (76% continental Europe, 41% U.K.) * Enhance risk governance and organization (61% continental Europe, 19% U.K.) * Improve risk identification capabilities (52% continental Europe, 15% U.K.) "U.K. insurers clearly feel better placed as a result of regulatory changes introduced by the FSA in advance of Solvency II. Their focus is now on developing the right tools to suit the new environment," said Ian Farr, principal. "The increased risk sensitivity and flexibility of Solvency II provides will trigger greater product innovation, more innovative capital management, capital raising and financing structures." Room for Improvement While ERM has made significant progress in recent years, there are still growing pains: * Most respondents (77%) are highly focused on improving risk measurement and quantification processes to enhance their overall ERM efforts, particularly in the U.K. (97%) and Japan (95%). * Respondents are generally not satisfied with their current capabilities in many of the risk management areas they see as important. They are significantly dissatisfied with their ability to quantify operational risks and their ability to reflect risk in performance measures. "Insurers now recognize the potential impact a single event like a security breach or systems failure can have on their operations, as well as on their financials. Operational risks can be complicated and difficult to quantify, so many are turning to scenario analysis to achieve meaningful results," said Shimpi. "We expect operational risk modeling and management practices to steadily improve over the next few years." Economic Capital as a Key ERM Tool The survey also found that many insurers are moving toward the use of economic capital (EC) as a risk management tool. As stated previously, nearly two-thirds (65%) of all respondents calculate EC and an additional 19% said they are considering calculating EC, implying that it may soon be a universal tool. EC use is already at 99% in the U.K., where the FSA requires companies to perform an Individual Capital Assessment. Almost all respondents (89%) are planning to make further improvements to their EC modeling capabilities. More information is available at www.towersperrin.com/tillinghast Source: Towers Perrin

Fairfax, Va. - The Public Entity Risk Institute (PERI), a Fairfax, Va., nonprofit risk management training and educational organization, has released a resource guide for controlling workers' compensations costs that focuses on using telephonic nurse injury reporting and triage as important early intervention. The PERI Day of Injury Resource Manual outlines an effective strategy lays out a proactive approach for addressing rising costs of workers' compensation by establishing processes for responding to employee injuries starting right on the day of injury, says Gerard J. Hoetmer, executive director of PERI. "Our research presents compelling evidence that employer actions on the day of injury have a profound impact on the overall cost of workers' comp claims." The PERI Day of Injury Resource Manual builds on the findings of a study PERI jointly sponsored with the Schools Insurance Authority (SIA), a joint powers authority based in Sacramento, California. In partnership with SIA, the PERI Day of Injury study assessed the relationship between employer actions on the day an employee was injured and workers' compensation costs. The study focused on injury reporting, directing medical care, and early return to work initiatives. A major component of the research focused on SIA's use of telephonic nurse injury reporting/triage. The study demonstrated that the nature, duration, cost and eventual outcome of a claim can be largely shaped and controlled by the employer's response on the day of injury. Based on the study, the manual details injury-reporting processes for organizations to put in place as part of an overall early intervention strategy. This how-to manual also highlights best practices for building a structured return-to-work program and provides organizations with sample forms, checklists, and training materials. For more information, go to www.riskinstitute.org. Source: The Public Entity Risk Institute