Filed Under:Technology, Tech Management

Double Digit Growth for Carrier

Ease of doing business has become almost a clich? in the insurance world, but in the case of property/casualty carrier Fremont Insurance, it proved to be an important factor in the carrier's unprecedented success.

"When you get down to it, agents will migrate toward those systems that are easier for them to use," says David Mangin, executive vice president and CIO of Fremont. "Automation and software can only take you so far. You have to couple that with the relationship you have with the agents."

Agents also look at their own cost structure, explains Mangin.

"They can't afford to sit around waiting to issue new business," he says. "They have to be productive to bring in new revenue. "

Independent agents in Michigan, where Fremont is headquartered, are surveyed every two years on where they rate all the carriers operating within the state. This year Fremont ranked third in the state. They were fifth in the previous rating.

"Our goal is to be number one, but we are competing with billion dollar companies," says Mangin. "We're a $75 million company, but we've somehow managed to level the playing field."

As a smaller carrier, Fremont felt its relationship with agents was already good, but to achieve more growth ease of business was a wise area to focus on, explains Mangin.

"We felt those things that affect us internally will take care of themselves by driving new business," he says.

It proved to be a good strategy. Over the last five years, reports Mangin, Fremont has had nothing but double digit growth. This record coincides with the length of time the carrier has been using the agency portal.

At the time, through--2006--Fremont wasn't sure this would be as successful as it has proven to be.

"What happens with smaller carriers like us is there's a hesitancy to spend capital," says Mangin. "Our concern was we may be bellying up to pay this but what's the guarantee we're going to get the benefits."

Fremont chose a phased approach, taking one line of business at a time and then stepping back to see how it worked. The fact that Fremont is now up to 10 lines of business operating within the portal is testimony to the portal's success.

Mangin is convinced the company's recent growth is directly related to the agency portal.

"That growth has come from our agents because we've made it easier for them," he says.

There were a few things that sold Fremont on SpeedBuilder Systems as a vendor. One was the experience of the vendor's development staff--over 100 years of experience at that time. Size was another issue. Fremont had worked with larger vendors and felt the frustration of being pushed aside when it came time to deal with upgrades and maintenance in favor of larger carriers.

"Here was [Speedbuilders] willing to give us some attention and with their experience how could we go wrong with that," says Mangin. "I always had confidence they could deliver."

Fremont's internal users have appreciated what the portal has done for their job duties as well.

"Before, we would take a personal lines application and five people would touch it," says Mangin. "We would wait sometimes up to a week to process a payment. Now all that can happen within five minutes."

By automating underwriting rules, Fremont is able to get 60 percent of its policies through the system without any manual intervention. This has freed time for the underwriters to focus their attention on larger risks.

"It's basically straight-through processing," says Mangin. "That in itself has saved a tremendous amount of time. If you have 20 percent growth in some lines of business it has to be automated in order to handle that growth."

Mangin is sometimes amazed how much more efficient Fremont has become.

"When you step back and think about everything we are now doing, you wonder how we managed to do this profitably in the past when we had so many people touching [policies]," he says. "We've been fortunate to have double digit growth without having to add head count. In fact, we've been able to actually reduce our head count."

-- Robert Regis Hyle

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