Filed Under:Agent Broker, Agency Technology

What's in a Name?

User groups keep communication open between agents, carriers and vendors.

There are no hidden meanings in the title of the ACORD User Groups Information Exchange (AUGIE). AUGIE is made up of the leaders of the different user groups that provide technology solutions to the insurance agency population.

“They’ve come together and said they are agents first,” said AUGIE facilitator Carolyn “Cal” Durland, who also serves as director of member relations for ACORD. “They take off the hats of the user groups and declare, ‘What can we do collectively as agents to lead the industry.’ ACORD is like Switzerland—a safe kind of place, not tied to any vendor, and doing things for the good of the industry.”

Although AUGIE is led by agents, its success depends on the merging of information from carriers and vendors as well, Durland said.

“AUGIE is a way to have a forum of agents, carriers, user group leaders, and vendors, as well as ACORD representatives,” said Jeff Yates, executive director of the Agents Council on Technology (ACT). “AUGIE and ACT are organized efforts within the industry to have people sit down and discuss the problems of the distribution system. How can we do our business better? We both have limited resources so we tend to divide up [the issues].”

The value of user groups arises from the fact no single agency or organization can use an agency management system at 100 percent capacity, said Ted Joyce, owner of Insurance Agency Services of Richmond, Va., and a board member of the XD Net user group, an AUGIE participant.

“We all struggle with using the agency management system in relation to best practices and using it to its fullest extent in the way it was designed,” he said. “Because of that challenge, we exchange information, data, suggestions, complaints and issues.”

The user groups in turn banded together with ACORD and ACT to create AUGIE.

“It allows ACORD, agents and brokers, insurers, and solution providers to gather information, share ideas and hopefully shape the future of what the industry is doing in the technology world,” Joyce said. “Even though we are on different systems,, all the systems basically work similarly. It’s the bells and whistles that make the difference in the systems. At the end of the day all agency management systems store data and move data from point A to point B.”

AUGIE doesn’t look at system-based issues, but at areas such as workflow, work processes, and demands of the partners.

“Vendors, carriers, MGAs, brokers, aggregators have come to the realization that we all have similar issues therefore it is easier to tackle the issues as a group rather than individually,” Joyce said. “It’s the old adage: Power comes from the group, not necessarily from the individual.”

Real Time

One focus for AUGIE has been helping with the organization of to promote real time in the industry.

AUGIE is working to spread more information to show agents they can achieve a consistent workflow to connect with their partners, which gives them more time to do the service and the selling, Durland said.

Real-time is clearly a priority, especially for commercial lines and the E&S market, Joyce said.

“Most carriers have personal lines down pat—it’s consistent and been around a while. The commercial side has been a struggle. Part of that struggle is because carriers have built systems in so many different ways it is hard to have a standard. That’s an impediment for us.”

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Real time remains a hot button for agencies, particularly for the commercial side.

“Over the last 12 to 18 months, carriers have started to realize that automating and paying attention to what agencies say has been an incredible help for them,” Joyce said. “It’s also reducing their costs and they have finally figured that out. They are paying more attention to it. It’s gaining steam and for those of us who have been banging on this for some time it’s a great feeling to see tangible results.”

Password Management

Multiple passwords used by agencies is another issue that has reached the tipping point. Agencies have hundreds of passwords that have to be managed, Durland said. Some of the password issues have been solved by what’s happening with the agency management systems, but every survey AUGIE has done has listed passwords as an issue for agents.

Password management comes down to two issues:  making the system manageable and having an automated management system, Joyce said.

She believes this is one of the issues carriers need to respond to if they truly believe they are easy to do business with from workflow and pure agency management standpoints.

Regarding security issues, Joyce points out if a lower-level person leaves the agency it might mean changing four or five passwords, but if it is a higher level producer it could involve up to 25 passwords.

“You can’t disconnect them in one fell swoop,” Joyce said. “You have to do them individually. What happens if you miss one and unfortunately that person has an axe to grind? You and your carrier partner are at risk. That not only affects you, it affects a client or a prospect. You can see the great payback on this and it’s critical to get done.”

Trust Framework

Carriers, agents and vendors formed the ID Federation, a new nonprofit group, in December 2011. Its mission is to work within the financial services industry to minimize the need for passwords. Membership includes carriers such as The Hartford, Hanover, and Progressive, most of the agency management systems vendors, and other interested parties.

Jim Rogers, assistant vice president, commercial markets technology for The Hartford and a member of the board for the ID Federation, said that the proliferation of IDs and passwords is the most serious issue in the agency distribution system.

Groups like AUGIE scanned different verticals for the answer and came across the concept of trust frameworks, he said.

“How can you create an entity for people to join so they can trust each other with identity?” Rogers asks. “The goal we came up with was to minimize or eliminate the notion of passwords within the industry.”

For agencies with 20 carrier appointments, each individual has 20 passwords to manage, Rogers said. With the trust framework concept, the agency management system or the agency itself is the identity provider.

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“As they log in to their PC they will seamlessly work with their carrier and not have to remember passwords,” he said.

One of the problems connected with managing passwords is when an agency employee has to go to each carrier’s website to get an ID. If that employee leaves the agency, the agency has to deactivate the log-in and go to every single carrier they are licensed with.

“In a federated world, the instant the agent leaves, all connections are severed,” he said. “That was another key provision to instantly turn someone off so if they went to another agency there was no way they could log back into their old system.”

Three Divisions

The ID Federation created a business model around three areas: business, technical and legal. Rogers reports the technology to accomplish their goal already is in place; the issue focuses more on how to apply the technology and in what context.

The legal issues were daunting, Rogers said.

“We found if we were going to try and federate between two organizations it may take longer on the legal side than the technology side,” he said. “The issues of indemnification, and data breaches were important. If you join the federation you agree to a trust framework and are accountable to these trust standards and these legal, binding documents. General counsels had to figure that out so the end result was good for the carrier, the software provider, and for the agent or broker.”

There have been about 10 implementations of the trust framework this year and Rogers explains the ID Federation is committed to seeing that grow.

“We have quite a lot of interest among carriers and we haven’t done any marketing yet,” he said. “We’re OK with that because we want people that are serious about it and who are going to be members.”

Rogers knows that it is a rare case where companies increase their level of security without adding more work. But in this case he believes carriers and agencies can significantly increase the security of transactions and make it significantly easier to do business.

“Whether going browser-to-browser or Web service, [agents] are clicking on something and instantly getting into the product,” he said. “That’s a seamless workflow and is much more secure.”

A Small Token

The ID Federation uses a SAML token created by an identity provider and sent over the line so both the agency and the carrier know what the token looks like and what it’s made up of. The identity is authenticated and the user is allowed to enter into the application, Rogers said.

“Right now the federation only deals with authentication,” he said. “We haven’t tackled authorization. This gets them in the door but whoever the relying party is or the one taking in the credentials has the identity there and matches it with the authorization.”

What will be valuable for all parties once they join is they will get the legal protection and a set of standards for the technology that align with the ACORD standards, specifically AWSP version 2.0 of the ACORD standards. ACORD was part of the initial group with some of the design work, Rogers said.

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If the carrier already has a federation they can leverage that, he said.

“Transactions don’t go through the ID Federation,” he said. “There’s no centralized hub or anything like that. When people get into identity management it is up to each partner to determine the trust level. Being a member of ID Federation doesn’t mean you are going to do business with every member. If you decide to do business with another partner your speed to market for authenticating is significantly reduced because it is clear: how you do it technically and the legal agreements are in place, although they don’t replace underlying agreements any two entities would have.”

2012 Goals

Rogers believes ID Federation membership will double and triple through the years.

“Our biggest goal is to make sure we have those communicating partners that want to work in a federated world and need the framework to do it,” he said. “It will continue to evolve, but our mission is to eliminate or minimize the need for passwords.”

Insurers are competitive, but they need to compete on customer service, their products, their value-add, and price.

“In financial services, one thing you don’t have to compete on is whether your password has seven characters or eight,” he said. “Security is important to everyone in the financial services and we can make it better for our customers as an industry. We compete on many things, but we don’t have to compete on a password.”

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