Hartford, Conn. - In the latest of several insurance-specific vendor mergers and acquisitions, Innovation Group, a U.K. provider of P&C outsourcing and technology, is acquiring Boston-based claims-reporting outsourcer First Notice Systems, Inc. from Concentra Operating Corp., Addison, Texas. Innovation Group counts among its U.S. customers the California State Automobile Association, Nationwide Indemnity and The Auto Club of Southern California. First Notice provides services to Pemco and The Hanover Group, among others. The announcement follows close on the heels of another outsourcing deal, Capgemini's acquisition of India-based Kanbay, a provider of outsourcing services to the financial services sector. Capgemini will acquire all of the outstanding common shares of Kanbay for $29 per share in cash. Kanbay claims to have more than 200 customers in the insurance sector, which, say analysts, has the potential to strengthen Capgemini's presence in North America by providing it with an improved banking and financial services focus. The Boards of Directors of Capgemini and Kanbay have already approved the transaction, which is set to increase Capgemini's presence in India (+89% based on Q3 figures). The combined company will have headcount reaching 12,000 employees by the end of 2006 in India, reports the popular press. The Innovation Group, meanwhile, is set to pay (U.S.) $51.55 million in cash, comprising consideration of $50 million and related payments of $1.55 million for First Notice. The acquisition, which is subject, to shareholder approval and certain other customary finance and closing conditions, is expected to close in the fourth quarter of 2006, providing a platform for the company to grow its insurance outsourcing business in the U.S. First Notice's principal focus is on processing-on behalf of its clients-the first notice of loss (FNOL) made by an insurance company customer of a claim or a potential claim. First Notice currently processes approximately two million claims a year and makes 10 million outbound distributions on behalf of its client base, which comprises more than 100 insurance clients, including carriers, third party administrators and self insured businesses. With U.S. headquarters in Hartford, Conn., Innovation Group's deal adds claims to its portfolio software-led business processes for the handling of the breadth of the administrative processes of insurers and risk carriers - including back office functions such as claims management and sales, as well as software technology for both policy and claims administration that can be utilized in connection with its outsourcing operations or implemented on a stand-alone basis. Source: The Innovation Group, The Business Wire

Fed up with the life of an insurance agent, many aging baby boomers are retiring or choosing something spicier for their lives. Some principals are seizing the opportunity to sell their agencies to banks or another entities. While they may make big dollars or find cool waves, sticky problems remain in their wake. Too often, principals are struggling to attract new agents they can groom to take over the helm. At the same time, many of the country's brightest young business minds are looking askance at the prospect of being insurance agents; they've been spooked into thinking such positions will ultimately be filled by non-humans.The outlook seems so bleak that agents might someday vanish, and will it be technology that metes out the coup de grace? Or do most agents actually view technology as their savior?

Insurance has always been about risk, and insurance companies, armed with actuarial tables and reinsurance, have generally handled it well. But there are risks that go beyond the ordinary-storms that wipe out a city's worth of houses and businesses and create enormous correlative exposure; lawsuits that result in liability where none existed before, or threaten to remove exclusions. These sorts of risks can drain capital reserves and put the entire company in jeopardy.To protect themselves, insurance companies increasingly step back and take a holistic, enterprisewide view of risk, and align their reserves to meet not just everyday actuarial and financial risk, but risks that cross organizational silos.

When it employees at Cincinnati-based Great American Insurance Co. got wind late last year that their new CIO would be Piyush Sing, former CIO of the Peoria, Ill., multi-line P&C carrier RLI Systems, they probably took a deep breath-rightly assuming that big changes would be coming in how the company uses technology to conduct its specialty commercial lines business. Sing's reputation for building front-end technology to match his previous company's unique requirements (RLI's motto was to provide "Fundamentally Sound Innovation" to the insurance industry) preceded him.As expected, Sing came to Great American Insurance with a similar plan, and a vision to overhaul the 130-year-old company's front-end applications for insurance processing with a service-oriented architecture (SOA) and Web services approach. Especially critical to Sing's vision: the ability to manage the appointments, interactions and state-by-state compliance requirements of a U.S. distribution network comprised of 8,000 active agents.

HARTFORD TEAMS WITH TECH GROUPThe Hartford Financial Services Group Inc., Hartford, Conn., is working with the largest technology trade association in Washington State to offer policies designed for the technology industry. The insurer will market the insurance to members of the Seattle-based WSA (formerly the Washington Software Association) through brokers and independent agents. Nationwide, the Hartford insures more than 50,000 technology companies.

WHITEHILL SOFTWARE HELPS CREATE POLICIESWhitehill Technologies, Moncton, New Brunswick, has shipped a new release of the InSystems product line, which helps create insurance policies. IStream Publisher 3.2 simplifies production of insurance documents by managing the process from the first draft of the contract language through the issuing of the policy. The software also supports service-oriented architecture (SOA), which increases IT agility, and includes predefined services for retrieval, assembly, rendering, delivery and storage.

The world record for the largest game of Chinese Whispers, also known as the telephone game or Pass It Down, was set by entertainer Mac King, Jan. 6, 2004, and involved 614 people.While it's safe to say King didn't pass on a message about ways to sell long-term care insurance, carriers and agents may be able to relate to the game of Chinese Whispers. Clear and efficient communication among the two groups can become difficult. And adding communication among agents and consumers can muddy the water even more.

Insurance Networking News asked David Pedersen, senior vice president at Insurity, Hartford, Conn., to explain how a data integration project can evolve from an enterprisewide objective to a successful way of life.INN: Do most insurance companies have a data strategy, and why is it important?

Liability Insurance Administrators (LIA), Santa Barbara, Calif., was drowning in paper and all the costs associated with generating it, filing it and keeping it around. With an average of 15,000 to 20,000 active existing insurance policy underwriting files, the firm, which provides error and omissions policies to real estate appraisers, found itself having to hire new clerical staff to handle processing, as well as finding new space for all the documents."In the beginning, we just had one clerical person who would answer phones, do the filing, issue quotes, and do all other clerical work," says Robert Wiley, LIA assistant vice president. "As the company grew year after year, we had to start divvying up those duties to stand-alone positions, receptionist, clerical staff and filing staff. Eventually we had to keep increasing our filing staff, and we're now at the point where we're an office of about 29 people. And we have four full-time file staff and three part timers."

CAT CLAIMSCustard Insurance Adjusters, a Norcross, Ga., independent loss adjusting company, contracted with Marshall and Swift/Boeckh (MSB), New Berlin, Wis., for MSB's IntegriClaim tool for field estimating and for its IntegriClaim Administrator, which provides a paperless, Web-enabled work environment, for use in Custard's catastrophe and home office claims divisions. The technology package will send claims seamlessly from the carrier to independent adjusters.

The rapid proliferation of enterprise content, such as electronic documents, audiovisual files, instant messaging (IM), recorded phone conversations and e-mail, is having significant impact on the global insurance industry.Insurers now face severe penalties if they are unable to produce legally viable records of business conversations and transactions. Additionally, globalization, the dispersion of data and strict compliance regulations are key drivers of this emerging industry mindset.

Hartford, Conn., October 23, 2006 – To help agents speed up the decision process and provide quotes for eligible small business customers, Travelers Select Accounts division of Hartford, Conn.-based St. Paul Travelers Cos. Inc. has introduced TravelersExpress for Master Pac.TravelersExpress is an approach to processing new small commercial policy applicants because risk evaluation and pricing are delivered to the agent up front during the submission process. It will be available initially to agents in Illinois, Utah and Nevada and rolled out nationally in 2007.

Los Angeles - Farmers Insurance Group of Cos. introduces its new Mobile Catastrophe Command Center bus, which is designed to help its customers immediately after a catastrophe that may strike anywhere in the contiguous United States."The new Farmers Mobile Command Center bus was chosen as the catastrophe center-point for handling claims and servicing our customers," explains Frank Soldano, state executive, Farmers Insurance Group, Kansas. "The bus is equipped with the most state-of-the-art equipment available anywhere in the United States. It will enable Farmers claims representatives to offer claims help to our customers immediately following a catastrophe," Soldano said.

Richmond, Va. - Genworth Financial Inc. completed its acquisition of AssetMark Investment Services Inc. AssetMark is a Pleasant Hill, Calif.-based provider of open architecture asset management solutions to independent financial advisors, with approximately $9 billion in assets under management.Under terms of the agreement, Richmond, Va.-based Genworth paid $230 million for AssetMark and will make additional performance-based payments of up to $100 million over the next five years.

Washington - The commercial property/casualty market continued to soften during the third quarter, with indications that some insurers are finding an appetite for business in which they previously were not interested, according to the latest commercial market index survey by The Council of Insurance Agents & Brokers (CIAB). As has been the case the entire year, however, coastal property and catastrophe-prone risks remain costly and hard to place, brokers responding to the survey said. The Council represents domestic and international commercial insurance brokers and agents who annually write more than 80% of the commercial property/casualty premiums in the United States and administer billions of dollars in benefits accounts. Six out of 10 commercial insurance brokers and agents responding to the survey said their small accounts experienced decreases in renewal premiums during the third quarter, and three quarters of the brokers responding who handle large and medium-sized accounts reported that their customers had drops in premium rates. The majority of the decreases were in the 1-10% range for small, medium and large accounts, the brokers said. An analysis of The Council's survey results by New York-based Lehman Brothers showed that the average premium rates for all commercial accounts decreased 5.3% during the third quarter. The Lehman analysis showed the average small commercial account premium down 3.4%, the average medium account premium down 5.1%, and the average large account premium down 7.3%during the third quarter. As premium prices fall and underwriters become hungry for new business, the agents and brokers said that insurers are starting to be more aggressive in pricing and more liberal in policy terms. Types of properties "normally considered unattractive" such as car dealers, restaurants, not-for-profit and habitational are being looked at with renewed interest, CIAB's report said. Meanwhile, it was another story altogether for coastal exposures, according to CIAB's respondents, with wind, flood and property capacity still tight, deductibles and exclusions on the rise. Some carriers are expanding their definition of coastal property to business within 60-70 miles of the seacoast and categorizing areas such as the Chesapeake Bay as coastal. Any catastrophe-prone property was likely to experience difficulty securing coverage, CIAB reports the brokers and agents said, with premium levels at historic highs. Although the problems appeared to be the worst in Florida and along the Southeast coast, one respondent reported commercial earthquake rates up as high as 50 to 150% in Southern California. For complete regional and national data charts, go to www.ciab.com/marketsurveyQ306.

New York and Saint Paul, Minn. – Metropolitan Life Insurance Co. (MetLife) and Travelers Insurance Group Holdings Inc. renewed their agreement to offer Synchrony absence management services.Synchrony combines group disability insurance and the Family Medical Leave Act (FMLA) administration from MetLife with workers compensation insurance and claim administration services from Travelers to deliver one, integrated approach that can help companies better manage employee absences whether due to occupational or non-occupational events and assist employees in returning to work as soon as medically appropriate. First offered by the two companies in 1998, Synchrony programs currently cover more than 180,000 employees.

Bedford, Mass. - As seen just a day earlier, insurers are embracing SOA (see "Survey Says Insurance Carriers Are Embracing SOA"). But new survey results insist that governance is not keeping pace with the adoption of SOAs at most organizations—of which include financial services, banking, government, insurance, healthcare and pharmaceutical.The online survey, conducted by New Rochelle, N.Y.-based ebizQ and sponsored by Bedford, Mass.-based Progress Software Corp., consisted of 313 respondents. While the survey shows that the majority of organizations are actively pursuing SOA, most are relying on manual processes to enforce SOA governance. Less than 6% have automated runtime monitoring of policies, and fewer than 5% automatically check services for policy enforcement before services are checked into a repository.

Needham, Mass. - The insurance industry is rapidly embracing service-oriented architecture (SOA), as well as related Web services and standards, according to TowerGroup research conducted in partnership with ACORD. TowerGroup interviewed senior leadership executives at more than 12 carriers and conducted more than 150 hours of data gathering and analysis across the industry (covering property/casualty, life and annuity, and reinsurance).Key findings of the study, according to Needham, Mass.-based TowerGroup, include:

Hamilton, Bermuda - Big European insurance companies are embracing industrial operating models to cut costs and improve customer service, according to an Accenture survey of senior executives at 30 carriers based in Europe.The survey revealed that 92% of respondents are assigning high priority to "industrialization"--the use of standardized operating and production platforms similar to those used by manufacturers. The rest of the respondents--the other 8%--say they expect industrialization to become a priority in the next three years.

Houston - The insurance industry, where companies face an average of 1,696 lawsuits, spanning product liability and environmental class actions to directors and officers claims, and even coverage fights over hurricanes and terrorist attacks, faces the most litigation when compared to other industries, according to a survey from international law firm Fulbright & Jaworski LLP, headquartered in Houston. Retailers and energy firms reported average caseloads north of 330 per company, which doesn't even come close to the insurance industry.In its third annual survey of corporate litigation trends—pulling data from 422 in-house law departments worldwide—Fulbright found that U.S. companies face an average of 305 pending lawsuits internationally. For large U.S. companies—those with $1 billion or more in annual gross revenue—the number of lawsuits soared to 556 cases, with an average of 50 new disputes emerging each year for close to half of them.