Vendors Automate Processing Tasks

Like managing general agencies and wholesalebrokers, there are a growing number of Web-based companies situatedbetween retail agents and property-casualty insurance carriers.

But companies like singleentry.com and Insurity.com arentcontracting with specialty insurers to provide markets for retailagents looking for hard-to-place specialty coverages.

Instead, for the technology firms who count specialty insurersand MGAs among their clients, ideas about Web-enabling insurers andagents, and about automating parts of their underwriting and ratingprocesses, are the missions that put them in business.

“We have always been [operating] in the segment between agents,brokers and underwriters, instead of going down to the consumerlevel,” said Jake Hampton, chief executive officer of Austin,Texas-based singleentry.com. But “we dont act as an online MGA. Weact strictly as a conduit so carriers and brokers can communicatebetter,” he said.

The basic product singleentry.com offers is a Web-based datacollection, submission and filtering insurance platform. Accordingto Mr. Hampton, that means that singleentry.com “gives brokers,agents, MGAs, and carriers the ability to collect the data online,to run the data through a system of filters or business rules, andthen direct the data where it needs to go.”

Carriers and MGA underwriters “only receive the types of risksthey want to receive” and they receive information on those risksin the form they want it in. They dont have to key in informationagain, he said.

Mr. Hampton, a former underwriter and agent, said he launchedthe company, referred to on its Web site as a “process serviceprovider,” along with partner Jay Menna in 1999, “out offrustration.”

“The process of procuring insurance was extraordinarilyinefficient,” he said. “We thought we could come up with a betterway of processing insurance.”

He said singleentry.com operates through three business groups.One of them, the Small Business Solutions Group, creates specialtytemplate-type programs, allowing retailers and MGAs to inputinformation, to get quotes back instantly, and to bind risksonline.

One technology the group developed is called Fast, Leading edge,Automated, singleentry, Hyperlinked underwriting module. FLASHallows MGAs to Web-enable any insurance program.

“Agents can pull up an application, fill it out, hit the submitbutton and [the system] writes it up and instantly sends it to an[MGA] underwriter,” Mr. Hampton said. The underwriter, then, hasseveral different options–request more information, decline therisk, or quote it instantly and send it right back.

“Instead of going through the normal processes of filling outpaper, its all hyperlinked,” he said, noting that by clicking on alink, the agent gets an instant response back as to what the MGAwill do.

Mr. Hampton said singleentry.coms Workload Business ProcessGroup builds the automated filtering processes that direct workflowthe technologies that determine, for example, if applicationsget sent to a Chubb or an AIG, by matching application informationwith different insurers underwriting criteria.

In July, singleentry.com announced that Los Angeles-based MGAAnderson & Murison Web-enabled two of its insurance programsusing singleentry.coms technology–commercial casualty and personalumbrella. Both programs use filtering mechanisms to compare risksto the MGAs underwriting guidelines. The umbrella program alsoallows agents to have password-controlled access to the MGAs Website and to receive real-time quotes on applications for acceptablerisks.

“The last thing were working on, that were most excited about,is a specialty marketplace for financial products,” Mr. Hamptonsaid. The Directors and Officers Market Exchange will eliminate theneed for agents to go to multiple Web sites to get quotes forD&O and other financial products coverage, he said.

“We give [agents] the ability to go to one place and fill outthe information one time.” Then, “we deliver the data” to howevermany carriers the agents are contracted with– in the format inwhich those carriers want to receive it, he said.

DOME is scheduled to launch on December 1, he said.

Mr. Hampton said several different issues factor into the costof doing business with singleentry.com. “We can build a customapplication and charge an annual license fee” to companies orinsurers. “Or we can participate in the amount of volume that runsthrough” the systemcollecting a percentage of that revenue.

In that case, “we would ask for a small amount of payment upfront, so that we can build” a system, he said.

What “we like to stress most is that we have been agents and wehave been underwriters. Our customers are agents and underwritersand we dont change the process so much as we make it moreefficient,” Mr. Hampton said.

“With the filtering system that we have developed, underwriterscan reduce workflow by as much as 40-55 percent. They can process awhole lot more information on better risks that fit theirprofile[s], rather than weeding through a bunch of stuff thatdoesnt fit,” he said.

Another business process and technology firm serving the needsof commercial insurers, MGAs, and retail agents is SanAntonio-based Insurity.com, a division of Choicepoint.

“MGAs typically have many of the same requirements a carriermight have–underwriting, rating and issuing insurance policies,”said Clyde Owen, Insuritys chief executive officer. Those processesare “really the core of our functionality,” he said.

Underwriting, rating, and issuing functions, he said, are at theheart of Insuritys two main products, Commercial Intellisys andProducer Intellisys.

Mr. Owen described Commercial Intellisys, an underwriting andpolicy-processing system for commercial insurers, as a “mainstreamrating operation that would be used inside the carriers environmentby internal [company] underwriters and adjusters,” he said.

Moving to the MGA and retail agent communities, Mr. Owen saidthat Insuritys products help producers communicate with carriers,instead of supporting internal brokerage environments.

“Producer Intellisys takes that same functionality”the workingsof a carriers internal underwriting and rating system–and allowsthe carrier to extend that functionality to its producers, eitheragents or brokers, he said.

“Its a way for carriers to extend their work to agents andbrokers in a more controlled fashion [by] providing aWeb-interfaced functionality.” He also said that the system enablescarriers “to limit that functionality to what they mightchoose.”

For example, an underwriter might issue a $4 million policyinternally for a thousand vehicles. While an agent might be able tolog onto the system to quote and bind commercial auto policiesalso, the agent might only be able to produce a quote for a muchsmaller subset of business, he said.

Software costs vary by organization size, complexity of theinstallation, and number of users, he said, citing a range from$50,000 to more than $1 million.

Mr. Owen believes Insuritys success lies in the fact that it has“a broad enough set of tools [to] appeal to almost all of thecommercial insurance space. MGAs, wholesalers and carriers can fitsome piece of our products into whatever their strategy may be withrespect to ratings and policy” issuance, he said.

Reproduced from National Underwriter Property &Casualty/Risk & Benefits Management Edition, September 10,2001. Copyright 2001 by The National Underwriter Company in theserial publication. All rights reserved.Copyright in this articleas an independent work may be held by the author.

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