Policy adminstration

Needham, Mass. - As the insurance industry becomes more immersed in service oriented architecture (SOA) technologies, few outside organizations are available that provide peer review, guidance and cross-industry advice. Penn National Insurance, a Harrisburg, Penn., mutual company that provides a wide range of insurance, however, seems to find such an organization. Penn is among 31 others joining the newly formed SOA Consortium since it's inception on May 1, signaling the onslaught of business organizations across vertical markets requiring SOA-related information.

The Hartford P&C Co. built a single consumer view for both its new business and its renewable policies, including a customer application that gives it instantaneous information about its customers. Its personal lines business also has been able to bring together some 30 different third-party data sources in the company and put them into one source.The Hartford's personal lines now has a single manner in which it processes motor vehicle reporting (MVR) across the entire company. The insurer built a single service that enables The Hartford to get immediate access to data across the company and work real-time with the states provided to gather MVR information. That service is now used in six different places across the firm, for everything from renewal purposes to billing purposes. Meanwhile, The Hartford's commercial lines business has made great strides in automated decisioning, improving its billing and creating new automated underwriting. The carrier's agents are now able to receive information in real time and provide quotes to commercial customers quickly.

This is the third in a series of INNovators Award Winners.

Some things change; some don't. A 2002 report from Boston-based Celent LLC, stated, at that time, within insurers' IT budgets, expenditures on internal staff consumed the lion's share, roughly 44% on average, with another 11% spent on consultants. Software licensing and support formed the next largest block, with a 20% share, followed by hardware with 15% on average. Connectivity and bandwidth consumed about 8% of budgets five years ago.What probably did not change in the five years between these findings is that CIOs' decision-making plays a big role in how these numbers come about. INN's first-ever issue in 1997 contained the article, "The New Breed of Insurance CIO," which concluded that more is being requested of the insurance company CIO than ever before. CIOs are not only being asked to have more business savvy, but also to be a communicator to senior management and an agent of technological change for the organization and its information systems.

The editorial mission statement from our 1997 inaugural issue of Insurance Networking and Data Management reflected the industry's overarching requirements: "Every issue promises you, our readers, comprehensive and credible information on the most important data access, electronic networking and electronic commerce issues that are revolutionizing the nation's insurance industry."At a time when e-commerce was dawning, IT spending on these technologies was a mandate: Carriers were charged with keeping pace in order to remain competitive.

AGENTS DEMAND REAL-TIME SERVICEIndependent insurance agencies are poised for a major service breakthrough with the proliferation of real-time transactions, says a prominent participant in the industry-wide push to double real-time transaction volume in a year.

WHETHER ON PAPER OR ONLINE, TEN YEARS LATER, THE PERSONAL TOUCH STILL MATTERS

PPS SOFTWARE SUITESkywire Software, a Frisco, Texas-based provider of software products for the insurance industry, announced the availability of a reporting tool for PPS, its policy production system for managing general agencies and wholesalers.

Over the last 20 years, the advances enabled by financial modeling are impressive. Insurers have made improvements in risk management, capital optimization, product development and other important aspects of their business with the help of financial models. The critical importance of financial models has never been more evident.Products today are increasingly complex, and the pressure to manage, measure and report risk continues to grow. As a result, models viewed as highly sophisticated just a few years ago are now inadequate to meet today's needs. However, keeping pace with these demands is becoming increasingly difficult.

How can carriers capitalize on the convergence of service-oriented architecture (SOA) and business intelligence (BI)? Insurance Networking News asked Mark Gorman, strategic research advisor, insurance, and David West, research area director, insurance, for TowerGroup Inc., Needham, Mass.INN: More and more carriers are seeing the value of SOA for BI (i.e. business intelligence services). Why? What are the drivers?

Among insurers of all sizes, everything is a process. Evaluating whether a process is efficient and cost-effective is oftentimes painful, because it means that workers need to rethink how they are going to work and, ultimately, change the way they function. Insurers that implement business process management (BPM) face challenges-and certain successes-associated with that change. In June, Boston-based research firm Celent LLC invited representatives from a small, medium and large insurance company to a meeting in Chicago where they shared their implementation stories.Celent Senior Analyst Donald Light, and insurance practice group Managing Director Matthew Josefowicz led the group in its discussion of what it takes to manage through the numerous challenges associated with continuous improvement and successful BPM implementation.

In many circles, codependency is frowned upon. But when it comes to IT implementations at insurance companies, codependency may be a good thing.That's the philosophy behind the IT success at Selective Insurance Group Inc., a Branchville, N.J.-based holding company for seven property/casualty insurance companies.

VALUATION SOLUTION REDUCED CLAIMS SETTLEMENT CYCLEPlymouth Rock Assurance Corp., Boston, selected San Diego-based Mitchell International Inc.'s, Total Logic Valuation as the company's total loss valuation solution to deliver a customer-centric loss claims process.

Most companies today understand that customer communications are integral to successful customer relationship management programs. Many of these communications are initiated from field organizations. Letters, proposals, quotations and marketing materials are often created, assembled and delivered to customers from branch offices.Historically, technological limitations have prevented companies from effectively controlling the content and integration of these communications with mainstream fulfillment processes. This has led to higher costs, poorer communications and reduced customer satisfaction.

In June, Boston-based research firm Celent LLC invited representatives from a small, medium and large insurance company to a meeting in Chicago where they shared their business process management (BPM) implementation stories. Celent senior analyst Donald Light, and insurance practice group managing director Matthew Josefowicz led the group in its discussion of what it takes to manage through the numerous challenges associated with continuous improvement and successful BPM implementation. The Panelists:Monique McKeon (MM), assistant vice president, Chubb Commercial Insurance - CPSS, Warren, N.J. Chubb's net written premiums increased 1% in Q2 2007 to $1.3 billion. BPM target area: commercial underwriting. Number of initial users affected: 150; two years into the project: 900. Vendor of choice: Metastorm. Kimberly McGregor (KM), director, imaging and process analysis, Ohio National Financial Services, Cincinnati. The company has total assets under management of $22.5 billion. BPM target area: as part of a larger legacy replacement strategy, the company focused on individual annuities; underwriting, policy administration and claims legacy systems. Number of users affected: 500. Vendor of choice: CSC. Chris Spring (CS), senior vice president, Meadowbrook Insurance Group, Southfield, Mich. The company manages in excess of $700M in premiums under management. BPM target area: company-wide rate-book-issue processes. Number of users affected: 650. Vendor of choice: Adeptia. The Celent team posed one last question to the panelists—what is the most important piece of advice you can offer other insurance carriers currently considering a major BPM project? MM: Make sure BPM is positioned correctly within the enterprise. From a technical perspective, make sure BPM is positioned in the right place in the enterprise architecture. Know what BPM is (is it a one-size-fits-all program or one that enables you to pick and choose capabilities as you go? Is it just the human workflow or does it also include SOA and integration, business rules, etc.?) Then set up a centralized support model that includes governance. KM: Get the users involved, right up front, and help them become comfortable with the change. When change comes, it's because they have brought that change to us. They know that when a change is required they need to take ownership of it and we just help them because is makes all of us more efficient. Build momentum in your commitment and make sure business owners have a key role. Build the skill sets. Manage human issues. Be flexible. Get senior and line management buy-in. CS: Realize your power and be ready to make the investment. BPM should be deployed across the organization, not siloed. Look for a cheerleader. Who is on top of the process? Over-communicate if you have to. Do the t-shirt and road shows. For those that have implemented BPM, rethink what you did. Look at the processes already in place. Then reevaluate your strategy and design to ensure maximum usability and efficiency.

Carriers implementing BPM strategies are bridging from the hard-coded world of today to an easily configurable world of tomorrow. And getting out of a legacy environment and into the world of thinking in configurable terms will always be a work in progress. “You need to be able to achieve change when it’s required,” says Donald Light, senior analyst with Boston-based Celent. To successfully address these challenges, Light recommends insurers ask the following four questions: 1) Do you have the staff resources necessary to deepen and extend use of BPM solutions beyond initial deployment?2) Are you in the early days of replacing inflexible core legacy systems or well along in that process?3) Is your primary need to make processes uniform and compliant within and across business units?4) Is there a clear SOA roadmap in place or is the enterprise infrastructure just now being addressed? On the technology solution provider side, says Light, a BPM vendor must also conduct due diligence. Light recommends vendors begin the process by including the following four elements:1) A strong set of functionality and tools that will facilitate carrier implementation of its SOA strategy.2) An emphasis on ease of use. This is especially important for IT developers as they create the code and/or integration processes that their peers on the business side created.3) Strong modeling, analytics, and optimization capabilities.4) Include a set of insurance-specific features.

Westlake Village, Calif. - Policy retention is critical to the financial success of auto insurance carriers, and a customer's experience with their provider is the most important element—outweighing brand image—in generating policy renewals, according to the "J.D. Power and Associates 2007 National Auto Insurance Study."The study measures customer satisfaction with auto insurance carriers across five factors. In order of importance, they are: interaction, policy offerings, billing and payment, price and claims.

Boulder, Colo. — IT risk management is no longer strictly about mitigating the negative threats surrounding IT, a new study finds. The study was published by Boulder, Colo.-based independent IT management research and consulting firm Enterprise Management Associates (EMA).

New York – Two life insurers recently appointed a number of executives. ACE Life Insurance Co., a business of Bermuda-based ACE Ltd., named Jim Gibbs as vice president and chief underwriting officer and Bruce Horton as vice president and chief marketing officer. Gibbs joins ACE from Optimum Reinsurance Co., Dallas, where he was senior vice president, underwriting. His previous experience includes positions at SCOR Life US Re, Dallas, and Munich American Reinsurance, Atlanta. He is a past president of the Southeastern Home Office Underwriters Association, and he has been a speaker at many industry gatherings, addressing both underwriting and actuarial groups on various topics.

Chicago – A new study evaluates the home pages and usability of 14 major auto insurance providers’ Web sites to examine customer expectations and discover where companies succeed or fail in attracting and retaining customers.