Perfectly Legal

Managing legal invoices electronically allows a carrier toobtain a better understandingof what outside counsel is doing torepresent the carrier in claims litigation.

Lawyer jokes aside, working with 160 law firms is no laughingmatter for a property/casualty insurer such as Westfield Insurance,which often finds itself involved in claims litigation throughoutits 26 operating states. That is why Westfield went searching for atechnology solution that could perform three primary functions:assist in the review of invoices from outside counsel; capturelegal-expense data; and create an efficient collaborativemanagement platform to work with counsel.

Dan Winkler, director of claims legal support services atWestfield, reports the company threw a net over the entire legale-billing industry when it began its search for a solution. "Weassembled a team that represented our claims department and ourbusiness solutions group," Winkler explains.

The team identified a number of vendors in the field. "Duediligence started in January 2002," he says. "We reviewed thevarious vendors that were identified, and given the parameters ofour technology objectives and our various management initiatives,we eventually signed a contract with TyMetrix in May 2002."TyMetrix delivers its matter management and electronic invoicingsystem under the ASP model, allowing clients to take advantage oflower capital costs and eliminate system development, maintenance,and data storage.

"Due to the inherently sensitive nature of the data we store andtransfer, we carefully scrutinized the TyMetrix system security andsecurity protocols," Winkler says. "We were impressed by itsexpertise in maintaining system security and with its commitment tohosting its application securely."

Westfield works collaboratively with its law firms to helpensure outcomes are timely and cost efficient. "Wrapping thisaround an electronic solution where much of this work previouslyhad been done on paper took some getting used to," Winklersays.

Westfield is committed to selecting outside counsel carefullyand providing feedback to legal firms to increase collaboration andimprove results. "There is a vast range of factors that go into theselection of outside counsel," notes Winkler. "Some are objective,such as billing rates, win/loss ratio, and budget adherence. Someare subjective, such as responsiveness, timeliness, work quality,and case evaluation accuracy. We needed a way to gather all of thisinformation in a single place, quickly review and analyze it, andthen use it to make counsel evaluation decisions."

In the TyMetrix system, Westfield collects objective data onfirm performance through electronic invoicing, budget reports, andcase closure information. Additionally, Westfield collectssubjective data through a "counsel report card" in which the leadclaim handler rates the law firm in three areas: knowledge/skill,file management, and service.

"While one of our requirements was to streamline the submissionand review of invoices with an electronic invoicing tool, we wouldhave done ourselves a big disservice to forgo the opportunity tocapitalize on the real benefits of this technology–namely, thecollaborative platform and the automatic aggregation of financialinvoice information that can be used for budgeting, analyses,planning, reporting, and counsel evaluation," Winkler adds.

The data analysis is an important part of the system, heindicates. "Our real impetus for moving forward with this systemwas to create a world where we collaborate with counsel and use thedata as the real nuts and bolts of how we move forward with a case,a law firm, and our departmentwide strategic managementinitiatives."

The carrier has received an immediate return on its investmentin terms of streamlining the invoice process, says Winkler,resulting in fewer touches and less administrative time. There alsohave been and continue to be significant long-term returns. "Webelieve the best results are achieved when information and casestrategy are developed and shared immediately at the beginning ofan assignment," he maintains. "Having this system in place hasallowed us to adopt quickly a strategically enhanced position."