A glimpse inside the personal technology arsenal and strategies that empower todays leading insurance IT professionals.
BY G. BARRY KLEIN, CPCU, CLU
In 1914, San Franciscan C.E. Cumberson had the misfortune of storing his car in his garage when the building burned down. Cumberson was reimbursed $2,200the entire value of his carby his insurer, AAA of Northern California, Utah, and Nevada, the very next day. That was the insurers first claims payment. In northern California today, one out of every four cars is insured by this second-largest affiliate in the AAA federation, which in 2003 brought in about $2 billion in direct premiums written for insurance, including auto, home, and life.
In comparison to its century-long history, its systems may not seem all that old, but in technology years, theyre due for some work. Our primary back-office systems are more than 30 years old, Bob Wilkes, senior vice president and business transformation officer of AAA of Northern California, Utah, and Nevada, explains, and while theyve served us well, we realize its time to replace them. Not merely replacing them, the insurer is capitalizing on this opportunity to reinvent itself. The company refers to the change it is undergoing as business transformation and is leveraging the initiative to improve efficiencies, lower costs, provide better information to management faster, and most importantly, to improve service to its customers.
Upon graduation from Cal Poly Pomona, one of the California State University schools, after majoring in business management and industrial management, Wilkes joined Allstate, spending the next 17 years going through the underwriting, sales, and marketing ranks. In 1989, he and some other Allstaters joined Viking Insurance Company, a small carrier owned by Xerox through its Crum & Forster subsidiary, which more than doubled in size before a series of mergers.
In 2002, Wilkes joined AAA as senior vice president of sales and service with a mandate to redo the management structure. Not too long into the job, the company CIO took a leave, and Wilkes was asked to take on that responsibility temporarily in addition to his regular duties. The CIO never returned, and Wilkes was given the IT responsibilities.
As we transform the operations, we see IT as a major enabler of these changes, Wilkes says. The AAA affiliate is a big operation to change. It has 4.2 million members, 5,000 employees, and about 100 offices. Our four major business sponsors are travel, membership, insurance, and our newest one, auto services, he explains. Auto services is an offering of a number of AAA affiliates, providing auto repair, tune-ups, oil and lube, and similar services.
As business transformation officer, Wilkes is responsible for four critical areas: 1) enterprise business planning; 2) business architecture and operation excellence; 3) the enterprise portfolio management office; and 4) IT. He recently hired a new CIO, who reports to him, to handle the CIO/CTO functions.
Transforming such an organization is a big job, so the company signed up an experienced team to do it. IBM is our lead vendor, Wilkes indicates, and it will be helping to implement a customized version of the HUON and E.piphany systems, phasing them in over a period of time. EDS will be responsible for the hosting and other functions.
Meanwhile, the insurer got a quick hit by implementing Steel Cards Web-based quoting system, which it calls Two-Minute Quote. Both our customers on the Web and our sales agents use Two-Minute Quote for real-time quoting of automobile insurance, our primary line. In fact, a sales agent can e-mail a link to customers or prospects who have Web access, and they can simultaneously review the quote and see the results of changing limits, deductibles, and other items. Wilkes reports 80 percent of all auto applications now go through the Steel Card system called Salesx. Steel Card implemented it in 90 days, he adds, and well be using it as the front end to the new policy administration system when it goes live.
So, what personal technology does Wilkes use to help drive all these projects? First and foremost, Im not just a user but an active advocate of the BlackBerry. Ive used it as an e-mail client since it originally was introduced, and today it also is my cell phone. Between the BlackBerry and our recent move to Web-based e-mail, Im now totally freed from having to carry a notebook computer when I travel. On a trip he took recently to Europe, Wilkes visited only Internet cafes when he needed a PC. He also carries a Sony FinePix 5 megapixel camera with a 2.5-inch screenhandy for a first-time grandfather. It fits perfectly into my back pocket without even needing a case. He carries his entire picture library on a Sony Memory Stick and has signed up for a digital-photo editing class. And when he drives to class, he wont have to worryif his car has a flat tire, you can be sure AAA will be right there to assist him.
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