Efficiency Experts

When Panhandle Farmers Mutual Insurance determined there had to be a more efficient way of doing business, Art Meadows felt that could be accomplished only by turning the carrier into a paperless enterprise.

Meadows, president and CEO of Panhandle, knew going paperless meant more than simply an imaging solution, however. "I spoke with other insurers and discovered even though some had gone paperless, they had not transformed their business processes," he says. "They had paperless files but weren't moving toward a paperless environment."

To become a truly electronic company, Meadows believed Panhandle had to make its Web site available for agents and policy-holders to conduct business, whether the users were buying policies, paying premiums, changing policy information, or processing claims.

"We still get some paper, but today approximately 80 percent of our [policy] changes come to the office paperless; the majority of our claims are being reported to us that way; and 65 percent of our applications are electronic," says Meadows. "We've tried to take the initiative if we are going to go paperless, let's do it; not just paperless files."

Finding a vendor to service a company as small as Panhandle wasn't easy. Before signing up for DocFinity, Meadows checked with two other providers. One of them didn't appear to have a fully developed solution, and the other acted disinterested and didn't bother to visit Panhandle's West Virginia headquarters. "The fit with DocFinity seemed to be much better," says Meadows. "It didn't care we were small. We were a client, and up to this point, we've been treated like a large client. [DocFinity] provides our needs and service when we need it."

Meadows began the search for a solution in the late summer of 2005 and had DocFinity on site in November of that year. "We were ready to make a move and signed the contract a few weeks later," he says. "We went live in January 2006. It moved along promptly."

A major issue Panhandle had to overcome was what to do with the paper it had accumulated over the years. The carrier recruited college students to prep the files so they could be scanned. By the time the carrier went live, all the files were prepared. "We did active files and one year of lapsed files," says Meadows. "We maintained the older [paper] files, but we didn't put them in the system."

The system worked well almost from the beginning, explains Meadows. "The first two weeks the learning curve probably was the toughest part, but once we got beyond that portion of it, things got smoother as each day passed," he says. "Within two months, it was second nature to us." Today, Meadows describes having electronic files as "a huge burden lifted from us."

Panhandle has achieved some tremendous benefits. Based on the estimated savings, Meadows reports the carrier is close to breaking even on the cost of implementing the system.

Cutting expenses was foremost on Meadows' mind when the project was initiated, but controlling the number of employees and becoming a more efficient operation also were part of the business strategy. "Due to the technology we've advanced and normal attrition, we are down to five employees [from eight], and we anticipate we can grow by 30 percent and not add any staff," he says.

It's more difficult for a company the size of Panhandle to move in the paperless direction the carrier has chosen, Meadows contends. "Larger companies have more resources," he says. "But with all we've accomplished we've done really well considering our size."

Meadows has no regrets and doesn't think he would change anything the carrier has accomplished. "We had to make adjustments as we moved through, but we moved forward," he says. "We truly don't have an IT person. Being small, we need to create good partnerships [with vendors] that can provide us the service almost as if we have someone in-house to do it."