Tech Helps Agencies Tame Paper Tigers

Insurance agencies are still struggling continuously to tame the paper tigers hampering the efficiency of their operation. Fortunately, marketplace and technology trends mean agencies can now do more with less--less information technology involvement, less capital investment and fewer headaches.

As far back as the late 1600s, when Lloyd's of London drafted its first contract on a piece of parchment, paper has dominated the insurance industry.

Today, insurance companies are still notoriously paper-intensive, and guilt by association dictates that distribution channels--including independent agencies--handle the same mountains of paper in the form of letters, reports, referrals, contracts, submissions, renewals, endorsements, claims and more.

To avoid costly mistakes caused by duplicative work, data-entry errors and overcomplicated processes that can exponentially increase customer disappointment, document management should be an integral part of any insurance agency's technology strategy.

Keep in mind that the systems available today are not based on your father's definition of technology. The current trend is toward systems that are user-friendly, intuitive, and able to be configured and implemented by business users with integration options for multiple platforms and existing IT environments.

Unfortunately, when it comes down to the actual implementation, many technologies fail the test. Document management, however, can actually help insurance agencies reduce dependence on paper, improve customer service, and comply with regulatory and disaster recovery requirements.

Think of your agency's reliance on paper as an addiction--one that is costing you time and money.

At this very moment, you have employees looking for misplaced files, retrieving information from file rooms, completing files that will need to be replaced, copying information for carriers, printing new paper documents, writing down messages and sorting through paper statements.

Document management can eliminate the high labor and operational costs associated with paper-based tasks.

In addition, once existing files are imaged and an automatic process is established to enter new documents into the system, document management eliminates the need for costly physical storage. That can free up real estate for additional employees, workstations, conference rooms and other productive space.

Like it or not, the fact is that carrier-to-agency commissions are dropping and wages for existing agency employees continue to increase all the time. That means agencies need to write more business without increasing employees, overhead and workload, in order to stay profitable in a highly competitive marketplace.

Imaging--a key component of any document management system--can make a significant difference here. Instant access to policyholder information--application, policy, quotes, submissions, renewals and correspondence--means tasks are completed faster, resulting in increased customer satisfaction and the ability to lock new submissions faster.

Most document management systems accommodate documents from multiple sources, including scanned images, e-mails and faxes. And, unlike paper files, once a document is imaged, it is available to any user at any location, at any time.

Depending on agency-defined authorization levels, the system even allows multiple users to view and work on the same documents or files at the same time, thereby promoting collaboration between employees and departments while increasing overall agency productivity.

Another way document management helps improve customer service is by streamlining workflows, automating everyday tasks and increasing transparency into the marketing process. In a paper-based filing system, agency managers only see completed work, but when files are stored electronically, managers get a real-time picture of the agency's daily workload.

This means that incoming mail and faxes can be monitored, status of work is immediately known, and tasks can be assigned or reassigned in the most efficient way.

Without document management and workflow capabilities, a single agency marketer might handle 10-to-15 accounts at a time, and pricing a policy could take all day. Depending on the agency, document management can often almost double the amount of work an employee can handle while decreasing the time necessary to get the best possible policy pricing to the customer.

Regulations and legislation--such as the Health Insurance Portability and Accountability Act, the Gramm-Leach Bliley Act and the Sarbanes-Oxley Act of 2002--carry severe penalties for companies not in compliance. Most include stringent document retention requirements and obligate organizations to protect the integrity and security of confidential documents and information.

While most document management systems were not designed specifically to handle compliance issues, it is a great side benefit your firm can take advantage of going forward. You will be able to quickly establish and enforce retention policies while generating an electronic audit trail specifying which users have accessed particular documents, changes made, and when the changes were made.

In addition, storing information electronically instead of in paper format supports disaster recovery initiatives. A document management system can ensure communication between locations and can enable you to conduct business from almost anywhere. Many systems will also allow executives or IT staff to back up strategic information on tape or CD for easy, immediate transportation.

With a document management system in place, you have the ability to proactively deal with disastrous situations, whether they are natural, manmade, unexpected, or just part of the plan. Peace of mind is knowing that you can simply pack up your data files and walk away with everything on a disk or an external hard drive if the need arises.

For many consumers buying insurance, it's just like playing "The Price is Right." Document management offers an array of benefits that can't be realized by implementing other technologies, and it does so without increasing dependence on IT staff and without a large capital investment.

That being said, at a bare minimum, any document management system you consider should have customized agency workflows and processes, integrate seamlessly with your agency management system, allow users to fax and e-mail directly from the system, and give business users the ability to do the configuration work.

The lower operational costs, improved customer service, and ability to react quickly to opportunities and threats that document management systems can provide can differentiate your agency from the competition.