The challenges involved with operating a small insurance companymay pale against those of giant, tier-one insurers—unless, ofcourse, you have to operate one of those small insurers with astaff of a dozen employees and confidence in the business partnersyou selected are up to the challenge.

The Barnstable is a small, niche personal property insurerlocated on Cape Cod, Massachusetts. The carrier writes only CapeCod property and has approximately 17,000 policyholders. Thecarrier offers its product through an independent agent force thatnumbers 21 agencies.

“Our goal as a business is to be a high value service providerto our stakeholders,” says John DeMello, president and CEO of TheBarnstable. By stakeholders, he means both the agents and thepolicyholders.

“We are focused on providing those stakeholders with a highquality product and backing it up with outstanding service,” hesays.

DeMello believes The Barnstable is unusual because of theconcentration of its policies in one area. He believes operating inone community—even one located near the ocean—is a positive aspectfor the company and looks at the company's size and proximity toits insureds as being an advantage.

The Barnstable has only 12 employees, which means each member ofthe staff plays an important role in the business, according toDeMello.

“Our employees tend to wear a lot of hats and have a widebreadth of responsibilities when you compare their roles to ourcounterparts with bigger companies,” he says. “Our key vendors alsoplay a large role in our business. They are looked at as businesspartners, which is one of the reasons why we chose IDP for oursoftware.”

When it comes to technology, DeMello doesn't believe TheBarnstable needs the latest, greatest piece of software.

“That's not to suggest IDP doesn't have great technology, butthat's just not our focus in terms of running the business,” hesays. “We're all about providing great value and service to ouragents. We are easy to do business with, but they select us becauseof how we do the small stuff. We're dialed into turning problemsinto opportunities and listening to our stakeholders. We don't havemultiple layers between those dealing with our customers and theultimate decision making.”

That's where IDP comes in, according to DeMello. Over the lastfive years, the vendor has assisted The Barnstable build out anagency portal that allows the carrier's agents to do basicfunctions such as policy and billing inquiry. As part of IDP'sInsuraSphere AgentXpress portal, The Barnstable also extendsservice opportunities to policyholders to conduct billing inquiryand status, view account, and process payments on demand.

“IDP helped integrate the portal with our back-end policy andbilling systems through the use of web services,” says DeMello. “Wealso have a document management system from Vertafore that we useto warehouse our customer accounts and claim files. IDP has been abig help with that by feeding the document management system dailywith output from the core system. That gives our customers accessto their documents through the portal.”

In 2012, IDP helped The Barnstable to developa mortgage billing function and to mail policies to mortgagees,according to DeMello.

“IDP automated that process to send out the bills electronicallyand make us more efficient,” he says. “It allows us to senddec-page information to the mortgagees. IDP was able to understandour needs and developed a nice solution for us. They were not animpediment; they helped make it happen.”

DeMello has a goal of taking the non-value added services thatdon't improve The Barnstable's customer relationship and eitheroutsource them or eliminate them.

“With just 12 employees we are challenged to manage 17,000policies,” he says. “Historically we've handled the printing forthe dec pages and are still doing it. We have to collate them andmail them out in a batch process every day. We ask our independentagents to mail them out to the 17,000 policyholders. It's aninefficient and costly process.”

The Barnstable has since found a business partner to take on theprinting and mailing to the policyholders through an electronicprint stream from the IDP system.

Also in 2012, The Barnstable entered the excess and surplus linemarket by forming a wholly-owned subsidiary company. Because theinsurer has such concentration on Cape Cod, DeMello explains theycould not afford to grow their exposure and book of businesssignificantly. At the same time, he explains, the independentagents need as much capacity as The Barnstable can afford to givethem.

“By forming an E&S broker and getting a Lloyd's of Londoncover-holder appointment, we were able to bring more capital to ourindependent agents so they can write more business,” he says.“There is a whole set of rules and regulatory requirements as wellas reporting requirements back to Lloyds. IDP did a great job ofunderstanding those business requirements and adapting theirsystems to the new processes.

The Barnstable outsources to IDP its core business functions,including the hosting of systems and software. The carrier alsorelies on third-party independent claims adjusters.

“Because of our size, we outsource all the systems and softwareand we don't want to have those systems internally,” says DeMello.“One of our strategies is to be sure none of our mission-criticalsystems is run internally. To have the entire InsuraSphere suite ofproducts to run our business was another key. We wanted to avoidseparate policy, billing, and claims systems from separate vendors.IDP was able to provide the entire suite of software solutions torun our business. That's important, particularly for a smallcompany. We have one point of contact for any software.”