Core systems

Minneapolis - Unitrin Direct a Chicago supplier of direct-to-consumer automobile insurance and its business partner, State College, Pa.-based Optical Image Technology, Inc., have received the Insurance Accounting and Systems Association's (IASA) 2007 Tech Award, the companies announced. This award was presented during the IASA 2007 Educational Conference and Business Show this week.Ian Zimmerman, Unitrin Direct’s director of underwriting, and OIT’s vice president of sales and marketing, James Thumma, were on hand to accept the award during IASA’s annual business luncheon. Unitrin Direct was looking to support its overall goal of becoming a leading direct auto insurer by scaling processes and optimizing support functions. The joint project between OIT and Unitrin Direct was to implement an enterprise-wide digital organization of their corporate information and to re-engineer their business processes by using workflow to horizontally align disparate silos of information stored within a variety of departments. Unitrin Direct is now equipped to push documents through automated workflows for approvals, signatures, customized letters, and calls as well as implement business processes that will automatically direct actions that need to take place. In addition, multiple technologies and departments such as underwriting, claims, and customer service were connected in order to process more work faster, with fewer human resources. Unitrin implemented Optical Image's DocFinity Workflow product to connect the company's policy administration system, and third-party applications, including their automated call system and capture, indexing, and barcode reading along with other DocFinity components such as an electronic repository. The technology, which includes over 24 separate automated workflows, is expected to continue to enhance Unitrin Direct’s position in a highly competitive insurance market as well as put them in a strong position for future growth, said the companies. Source: Optical Image Technology Inc.

Boston - AIR Worldwide Corp., (AIR) released Version 9.0 of its U.S. Hurricane Model, which includes enhanced methodology for estimating business interruption (BI) losses, which accounts for both building and business characteristics when estimating total BI downtime and includes indirect losses from sources other than physical damage to the insured building. The release also includes enhancements to the model’s demand surge function, the vulnerability of residential contents and pool enclosures, and incorporates research by AIR meteorologists and climate scientists into the link between elevated sea-surface temperatures (SSTs) and U.S. landfall activity. “In the aftermath of the 2004 and 2005 hurricane seasons, AIR undertook an intensive research and development effort to improve the way catastrophe models estimate business interruption losses,” according to Dr. Jayanta Guin, senior vice president of research and modeling at AIR Worldwide. The software also estimates indirect business interruption losses—those stemming from sources other than physical damage to the insured building—such as utility service interruption, actions taken by civil authorities, dependent building damage, and extended period coverage. The new model has been validated using detailed claims data from 2004 and 2005 hurricane seasons. Boston-based AIR is also providing an update to Version 9.0 of the U.S. Hurricane Model’s near-term catalog, which incorporates an additional 12 months—and several man-years—of research by AIR meteorologists and climate scientists into the link between elevated SSTs and U.S. landfall activity. Rather than relying on highly uncertain point forecasts of sea-surface temperatures, the Version 9.0 near-term catalog is instead conditioned on the assumption that currently elevated SSTs are likely to remain elevated for the next five years. As a result, the inclusion of one additional hurricane season will not significantly change estimates of near term risk. However, uncertainty in near-term estimates of landfall frequency remain significant, so AIR is once again releasing the near-term catalog as a supplement to, rather than a replacement for the standard catalog, which is based on more than 100 years of historical data. Analysis of claims data from recent hurricane seasons has revealed that contents vulnerability for single-family homes has decreased significantly in recent years. The updated model accounts for this trend. The model has also been enhanced to explicitly account for the impact of hurricane winds on pool enclosures, structures that—according to AIR’s latest research—show a higher vulnerability to wind damage than previously estimated. Finally, the impact of demand surge—the increase in material, services, and labor costs due to increased demand following a catastrophic event—was fine-tuned and validated using high resolution construction cost time series data for the 2004 and 2005 hurricanes taken from XactAnalysis, a reporting tool created by ISO subsidiary Xactware. Research at AIR shows higher levels of demand surge for time element, including BI. A state-of-the-art model alone is not sufficient for generating accurate BI loss estimates, notes the company. AIR’s analyses also revealed significant issues with the accuracy and completeness of insurers’ business interruption exposure data. For many companies, large numbers of locations have very low BI exposure values. In most cases, business interruption limits, which reflect part-year business income exposure, have been set equal to annual BI exposure. AIR also found evidence that companies are using general “rules of thumb” to determine the BI limit, rather than the use of BI worksheets for each location in multi-location policies. Finally, the number of locations that may sustai damage in a catastrophe is often underestimated. Together, these issues regarding the quality of BI exposure data lead to significant underestimation of modeled BI losses by many companies. “Modeled loss estimates are only as accurate as the exposure data input into the catastrophe model,” continued Dr. Guin. “Insurers must continue to put an emphasis on improving the quality and completeness of their BI exposure data to improve the accuracy of the catastrophe risk information used by company management.” Source: AIR Worldwide Corp.

New York - The Guardian Life Insurance Company of America introduced a debit card and Web tools as part of its FlexPlan Flexible Spending Account program, which enables clients to access and manage FSA accounts easily.Guardian's FlexPlan offers employees point of service access to money they set aside in their FSA, minimizing steps of substantiating claims with receipts and waiting for FSA reimbursements via mail. Clients can pay for co-payments, deductibles, prescriptions, eyeglasses and other eligible healthcare expenses with just one swipe of a Benny Pre-paid MasterCard card.

Chicago - Insurance Networking News magazine, a SourceMedia publication, released the results of its 2007 INNovators Award, a special designation intended to advance the spread of business technology acumen in the insurance industry.Nominees for the 2007 INNovators program included insurance carriers, agencies and brokerages. Their "innovation" was required to have been in production long enough to have returned demonstrable, tangible results.

U.S. CONSUMERS WANT CONTROL OF E-HEALTH RECORDSAmericans show a strong interest in controlling their own electronic medical records, according to a national survey released at a health IT conference.

ARCOT SYSTEMS AND ADOBE WORK ON DIGITAL SIGNINGSunnyvale, Calif.-based Arcot Systems Inc. has collaborated with San Jose, Calif.-based Adobe Systems Inc. to create a new option for digital signing in Adobe Acrobat software and Adobe Reader software using "Roaming Digital IDs."

PURE CHOOSES ONESHIELD FOR POLICY ADMIN SYSTEMPrivilege Underwriters Reciprocal Exchange (PURE), a startup with headquarters in Plantation, Fla., has selected software from Westborough, Mass.-based OneShield Inc. to support administration of new insurance products. PURE deployed OneShield's Dragon platform to manage the end-to-end policy administration of PURE High Net Worth Insurance personal lines product offerings.

Ithaca, N.Y. - Contrary to what many people think, the large majority of call centers serving United States' customers – service centers in remote locations that handle telephone and web-based inquiries – are operated in the U.S., not in India and other overseas locations. This is one of the findings revealed in "The Global Call Center Report: International Perspectives on Management and Employment."Some of the study's key findings:

New York - In an effort to involve its members in government affairs and lobbying initiatives, the New York-based Risk and Insurance Management Society Inc. (RIMS) launched the RIMS Legislative Action Center on its Web site at www.RIMS.org/LegislativeAction."RIMS has made it easy for risk professionals to become more active in government affairs," says Terry Fleming, member of RIMS Board of Directors and director of the division of risk management for Montgomery County, Md. "RIMS is recognized in government as the voice of risk management, but we need members to become more supportive. RIMS Legislative Action Center will provide the risk management industry with the tools necessary to reach out to members of Congress and make their voice heard."

Washington - Life insurance costs could be reduced by billions of dollars annually under an optional federal chartering system, according to a new study, comprised of research from Steven Pottier, associate professor of insurance at the University of Georgia's Terry College of Business.

Tokyo - Most Japanese insurance companies are now pursuing new customer and product strategies due to regulatory reforms that are opening the banking sector as a distribution channel for insurance products, according to an Accenture survey of senior executives at one-third of the insurance companies operating in Japan.

Zurich, Switzerland – Swiss Re entered into an agreement that gives it the right to sell the new business operations of Tomorrow, the recently re-branded GE Life to LV= (formerly known as Liverpool Victoria). Subject to the exercise of the appropriate option, and satisfaction of various regulatory and other conditions, the sale is expected to be completed in December 2007.

London - Regulatory overkill is the greatest risk facing the global insurance industry, according to London-based Centre for the Study of Financial Information's (CSFI) latest Banana Skins survey, in association with PricewaterhouseCoopers (PwC) LLP, New York.

North Richland Hills, Texas - Katherine "Kay" Phillips, who joined HealthMarkets in July 2006 as vice president and deputy compliance officer—Corporate Legal, was promoted to chief compliance officer and associate counsel. In her new capacity, Phillips will have responsibility for and direct compliance programs for North Richland Hills, Texas-based HealthMarkets.

Boston - John Hancock reports that it has enhanced its JH Illustrator software system, giving producers the ability to complete life insurance applications electronically. The company, which formulated this option based on building on an application wizard added to the software system last year, reports that, except for the producer and client's signature, it has essentially eliminated all handwriting from the application process. "Life insurance applications, especially at the higher end of the market, are complex, requiring numerous forms and a great deal of information," said Naveed Irshad, vice president of product management, John Hancock Life Insurance, a wholly-owned subsidiary of Canada-based Manulife Financial Corp. "Historically, much of this information has been filled in by hand. It was a time consuming task that we have all but eliminated. The only handwriting producers and customers will need to do is adding their John Hancock when they sign the application." He said John Hancock is committed to ensuring that doing business with the carrier is as easy and efficient as possible for producers and their clients. "Being able to enter data once by computer and have it pre-populate the rest of the application and then being able to type in any additional information will be an enormous time saver for producers," Mr. Irshad said, noting that the company is committed to additional investments to improve producer communications. After producers insert information in JH Illustrator for a policy illustration, this information automatically populates the appropriate fields on the life insurance application. The system also pre-selects and pre-fills supplemental forms that need to be included with the application. Once the forms are pre-filled, producers are prompted to save the application on their computer and fill in additional required information based on the case input directly within JH Illustrator. Unlike paper applications where the client needs to initial any changes, the enhancements let producers make and save changes neatly and quickly. In addition, because producers type in the information, the application that producers print out for the client's signature will be far easier to read. JH Illustrator also now includes an asset allocation option that allows producers to include a client's responses from a risk tolerance questionnaire and generates the appropriate asset allocation for the client's risk tolerance level and time horizon. Sources: John Hancock Financial Services, PRNewswire

Orlando, Fla. – More than 2,300 attendees gathered in Orlando this week for the ACORD/LOMA 2007 Forum. Since the two organizations presented its first joint forum four years ago, the insurance industry has moved at a faster clip, with technologies such as Service Oriented Architecture, business process management and straight-though processing taking center stage. The show's theme, "Identify, Innovate, Inspire," was evident throughout the conference, highlighted by topics presented in more than 80 sessions over the three-day conference. Outside of session time, traffic was brisk in the exhibit hall, where more than 180 solution providers demonstrated their wares. Greg Maciag, CEO of ACORD, told members of the insurance industry's official standards body that it has never been more critical to get everyone onboard as to the value standards play in the industry's success. "True competitive advantage is available to those who break down silos and barriers in order to enjoy the cost and time savings inherent in standards' use," he said. During the conference, LOMA, which claims 1,200 members in the life, health and other financial services sectors, launched its Corporate Learning Solutions Practice, a program designed to provide members with updates on solutions such as online courses and certificate programs specifically geared toward their professional needs. On Monday, May 21, Insurance Networking News, a SourceMedia Company, and Financial Insights (an IDC Company) released the results of the 2007 InsureTopTech awards to a standing-room only crowd outside the exhibit hall. As an official ranking of top solution providers based on an industry-wide poll of insurers, InsureTopTech is being called the "voice of the market." Several in attendance remarked that it seemed by design that the InsureTopTech awards followed the "Identify, Innovate, Inspire" theme of the conference. During her opening remarks, Insurance Networking News' editor in chief Pat Speer explained the significance of the awards. "The fact is, in a world in which the technology vendor community is shifting and contracting, insurers do have options, and they can use this vendor ranking to make well-informed buying decisions. Our readers who voted in this important program extended their voices in a chorus, making it possible for insurers to do just that." The overall winner, Guidewire, San Mateo, Calif., took home awards in five categories (see below for all categories and related winners). Most Adds Value1. Guidewire2. Sircon3. Hyland Software Up-and-Coming 1. Guidewire2. Hyland Software3. CSC Keep the Business Operating1. Guidewire2. CSC3. IBM Keep Insurer Informed Through Analytics1. Business Objects, Cognos (tied)2. IBM3. SAS Help Maintain Financials1. Peoplesoft (Oracle)2. Fiserv3. CSC Help Develop / Enhance Products1. Hyland Software2. Guidewire3. IBM Help Provide Quality Customer Care1. Guidewire2. Hyland Software3. AT&T, Avaya, Sircon (tied) Optimize Workflow and BPM1. Hyland Software2. IBM, ImageRight (tied)3. Ravello Other Areas (middleware, system integration, outsourcing, hardware)1. IBM2. HP3. Oracle, Dell (tied) The Identify, Innovate, Inspire, theme was also prominent during the Tuesday, May 22 CIO Roundtable general session, moderated by Maciag, who was joined on the stage by Ann Purr, LOMA's second vice president, information management; Saad Ayub, chief information officer for sales and service applications at The Hartford; Jeff Carlson, senior vice president, CIO for the Domestic Life Companies of AIG; Paul Fox, CIO, Guy Carpenter; and Ursuline Foley, senior vice president and CIO, XL Reinsurance. Maciag presented a number of challenging questions to the group, but received the most passionate responses to the question: do vendors understand our business, or do carriers need to do a better job of explaining their requirements to them? "They are getting better," said Carlson. "The days of us looking at a monolithic application are over. We are in a component world now and vendors recognize this." Foley maintained that vendors face a dilemma, especially in the life insurance area. "They are tight with our users' groups," she said. "They need to respond to users on a day to day basis but also look at taking the platform further. To a large degree, [vendors] are losing an opportunity. They need to provide more service oriented architecture components for the future." For more information about the ACORD/LOMA 2007 Forum, please visit www.acord.org. Sources: ACORD, INN

New York - Three-quarters of consumers are very satisfied with the service provided by their insurance agents and remain committed to working with them in the future, according to a new survey of 1,000 American consumers commissioned by IBM.U.S. consumers want personalized service and human interaction from their insurance providers, says the survey, which comes at a time when agent-based carriers are facing increased competition by direct channels and direct-only insurance carriers.

Oakbrook Terrace, Ill. - The Computing Technology Industry Association (CompTIA), a provider of vendor-neutral certifications for technology professionals, announced that five more companies in the printing and document imaging business are supporting development of a professional certification for the industry’s technicians.

NEEDHAM, Mass. - TowerGroup has picked 22-year insurance industry veteran David West to lead the firm's Insurance practice.

Stamford, Conn. - Agents claim time savings of more than 50% when carriers provide industry-standard, real-time solutions for processing transactions, such as quoting, billing and claim inquiries, loss runs, and policy views, according to a survey by a software vendor.