Soft Landing

Has there ever been a more important time for insurers and agents to work together to solve connectivity issues? Life isn't easy these days, but ease of doing business continues to climb the ladder of items independent agents demand of their carrier partners.

Ease of doing business is complicated by the fact agents have their own management systems to enter new business, while carriers have proprietary Web sites they encourage their business partners to use.

Can the two coexist? Mike Fitzgerald, senior analyst in the insurance practice at Celent, believes agency management systems and carrier Web sites can get along. In fact, agents surveyed by Celent for a report last fall replied they use both types of systems frequently. The main concern, though, is to be able to key in information just one time.

The responsibility for making sure the two sides get along usually rests on a carrier's underwriting staff, and Fitzgerald maintains there has been a big emphasis–especially in the middle market–on making underwriters more customer facing. “[Carriers] have to support [the underwriters] with really good support staff to do the mundane processes that typically keep the underwriters in the office–or at least the underwriters use that as an excuse to stay in the office,” he says.

Underwriting leadership needs to emphasize meeting with customers, notes Fitzgerald. “Underwriters are good at what they do, and they have been stroked for years and years at being able to dissect and properly price a risk,” he says. “That's different from doing three company calls in the morning and talking about risk trends over lunch. That's not the same skill set.”

IMPROVING BUSINESS

Before integrating AgencyPort software to launch its new WriteNow online quoting service, about a third of Summit Consulting's workers' compensation business came in online. “We wanted to leverage that more, but there were some challenges with respect to the connection between our front-end systems and our back-end systems,” says Matthew Buchmeier, manager of IT business systems projects for Summit. “They were not as robust or effective as they needed to be.”

The older system didn't allow for the agent and the underwriter to collaborate online, relates Buchmeier, and once an agent submitted business to the carrier, the agent couldn't reenter the system to make changes.

“There are special pricing and special terms related to workers' comp quotes, and often we had to leave the online world and go to our back-end systems to produce the quote the agent was looking for,” says Buchmeier. “We couldn't consistently deliver an effective online workflow from start to finish for any size account regardless of the pricing or coverage needs of the account. We wanted a system that would deliver all that and more to the agent.”

Summit's initial foray into quoting online had been good for smaller, less complex accounts and did many things very well, according to Buchmeier. “But we saw a much wider array of opportunities out there we wanted to tackle and offer to our agents,” he says.

Lynn Houser, underwriting vice president for Summit, asserts the older system had reached a plateau. “We had drawn just about everything out of our technology we could,” he says. “No matter what we did, we still had just a third of our business coming in online. The automated decisioning was somewhere between 10 percent and 15 percent. We knew we'd have lots more opportunities if we had more flexibility with our systems.”

Houser also noticed Summit was losing some small accounts because of the older technology. “Some of our competitors were easier to do business with and had greater speed,” he says. “Those were two areas where we were limited. We just couldn't do a whole lot more to make ourselves easier to work with and to speed up our process [with the older system].”

MEMIC is a monoline carrier offering workers' compensation coverage, and all of the carrier's business is written by independent agents. For the last eight years, indicates Karen Johnston, operations manager in MEMIC's underwriting department, the carrier operated an agency portal that allowed agents to do some inquiry on policy information and run a quick-quote system. All the carrier's submissions were coming in via paper, so MEMIC began looking at solutions to improve electronic submissions and settled with AgencyPort.

MEMIC has a primary group of contracted agents who make up about 75 percent to 80 percent of the carrier's business. Those agents received one-on-one training with the carrier to get them set up for their upload from their own agency management system into AgencyPort. “That's where we get the most buy-in, when they realize they don't have to do that double entry,” says Johnston. “We have a dedicated help desk and support for them, and the underwriters are involved in the whole process.”

DUPLICATE ENTRY

After joining ICW Group three years ago, Paul Zamora, a vice president for the carrier, felt the insurer needed to be more efficient internally in processing its business. “We were in a situation where we were entering the same data several times into several different systems,” he says. “We needed to consolidate that so we could achieve some efficiencies and a high level of scalability.”

The focus at ICW is to provide a better experience for its customers–the agents–so more efficiencies can be gained for both sides. “When we created this tool with FirstBest, we were very cognizant any efficiency gains for us needed to also provide ease of use gains for our agents, so they in turn can better service their insured clients,” says Zamora.

ICW calls its tool Snap, and it allows agents to upload data directly from their agency management systems. “[Agents] don't have to rekey that information into our system,” says Zamora. Snap allows agents to upload data directly from their agency management systems. “They don't have to rekey that information into our system,” says Zamora. “The upload functionality allows both ICW Group and our agents to become more efficient in processing and managing our business. As we look to the future, we fully recognize anything we implement will have to be a win for both parties.”

“Rekeying is a big issue for agents,” agrees Fitzgerald. “For whatever reason, there is a lot of rekeying [in insurance].”

In fact, 30 percent of the people who responded to the Celent survey said they had to rekey between 75 percent and 100 percent of their data, points out Fitzgerald. “Annoying is a good way of characterizing the problem,” says Fitzgerald. “And with multiple carriers, it can get very annoying.”

Summit respects its agents, emphasizes Buchmeier, which is why it was an early adopter of uploads from Transact Now and Transformation Station. “We recognized even before we launched this new system the need to get duplicate data entry out of the way,” says Buchmeier. “Agents just weren't going to migrate to online workflow without that obstacle being cleared. We put that in place early on and continued that with the latest development.”

There is a price to pay for convenience, though, cautions Fitzgerald. “For their biggest agents, carriers will foot that bill,” he says. For smaller insurers, however, “it comes down to the fact [rekeying] is annoying but not so annoying [agents] want to pay to solve the problem.”

Price and product are the main issues agents consider when placing a product, states Fitzgerald. But when those two issues are equal to the competition, he feels customer service drives the decision to go with a particular carrier, and often that means a good working relationship with the underwriter.

FOLLOW THE RULES

Since Summit developed a rules-driven application with WriteNow, the company can modify the system on a daily basis if need be to respond to changes. “The flexibility we've gained as an organization has been tremendous,” says Buchmeier. “We're going to keep looking at various real-time tools to help agents work directly from their agency management systems to our system to leverage some of the tools that are in the industry today. You've got to look at straight-through processing, electronic signatures, and ways to go from quote to written policy in a single sitting.”

Business rules are an important factor for MEMIC and its agents, too. A significant portion of MEMIC's book is small business–policies under $5,000. With those policies, most of MEMIC's agents have binding authority.

But before the AgencyPort solution, if the associate underwriter saw an agent submitted something that needed to be seen by an underwriter, those rules had to be applied by a person. Today, MEMIC is able to automate those rules so when the system recognizes a certain class code or coverage need, there is no guessing as to whether the policy needs to go to an underwriter or not. “It's automating that piece of the puzzle,” says Johnston.

MEMIC's underwriters have been enthusiastic about the changes, according to Johnston. “They can go in and see in a couple of clicks what the agents are doing: Have they started submissions? How many have they written? How many have they declined?” she says. “They can see and communicate with the agents without much effort. The rules themselves make things easier for an underwriter because [the system] answers so many questions during the process the underwriters don't have to answer those questions.”

BUSINESS DEVELOPMENT

Another issue ICW addressed was to make sure agents could have access to their own information, submit business, or collaborate with an underwriter aside from e-mail. “E-mail is a great tool, but it's not linked to an account, so unless the agency has a great tracking system in terms of how it saves e-mail, if [the agents] want to look at a history of what took place on a risk, [the information] is going to be only as good as how the data was stored,” says Zamora.

ICW Group wanted a system that would allow agents to look quickly at the history of the account. The carrier interviewed several vendors, and the FirstBest solution was chosen based on its look and feel and the ability for ICW to manage any changes in the system directly from its underwriting group instead of IT.

“Due to Snap's automation, we found a solution that provides a high level of ease in terms of doing business with us while allowing [agents] to collaborate with their underwriter within the system. Snap offers an instant messaging function, which a lot of our younger producers value, and a Notes capability, which all our producers appreciate,” says Zamora. “Snap has allowed us to achieve a high level of scalability. We are no longer inputting the same data into multiple systems, and we are able to provide quicker turnaround for quotes, another key benefit for the agents.”

AGENTS AND UNDERWRITERS

There are segments of ICW's workers' compensation business, such as small accounts, where the carrier tries to automate the underwriting. Still, Zamora believes with medium and large accounts agents want to be able to communicate with an underwriter–explain what is going on with the account and the risk and why the risk might be better than it appears on paper. “They want that dialogue,” says Zamora.

With agents being more on the go, Zamora points to a feature of Snap that allows agents to collaborate with underwriters while still enabling them to be mobile.

“The level of communication for most business people today is less over the phone and more through e-mail, text messaging, or in a [carrier] system,” says Zamora. “We were pleased this solution didn't require our agents to be strictly in the system. It allows them to be in the system, but it also allows them to communicate through an e-mail.”

WHAT AGENTS WANT

Most agents are looking for carriers to provide an ease of doing business through technology. Zamora observes even before the economy took a turn for the worse, agents' revenues were decreasing substantially in the states ICW Group writes business as rates continued to decline. “They were writing the same amount of business but for about half the price,” he says.

Agents were looking to carriers to find ways to make their lives easier and be more efficient, remarks Zamora. At the same time, the agents were looking for answers to their problems. “Ease of doing business along with easy access to information were huge needs for them,” he says. “If they are going to work more efficiently, they have to spend less time looking for answers, so they wanted access to their book of business 24/7 in an online manner.”

Greater access to underwriters was a key for agents. “They wanted the ability to collaborate with underwriters and get a quicker turnaround on quotes,” says Zamora. “One of their big pain points with carriers was when they were going to get their quote. As the economy turned, that continued to be a problem for them, since workers' comp is a pretty big line item for most policyholders in terms of their financials. [Insureds] want to be able to plan for the impact that [price] is going to have, so they are pushing their agents to get them answers quickly.”

GOOD FEEDBACK

The feedback MEMIC has received from agents is it now is easier for agents to upload data into the carrier's system, and that pleases Johnston.

“If we told them they had to rekey all the application data in order to submit business, we would be having a much different conversation right now,” she says. “We are able to reduce a significant amount of data entry. Speed is an obvious factor. It also eliminates the need for so much of the incidental back and forth. When you eliminate that, the whole process ends up being much more efficient.”

Buchmeier believes Summit reinvented itself with the help of technology. “Everything we did we took apart and asked ourselves how we could do things better,” agrees Houser. “We selected AgencyPort as a partner in our reinvention.”

A big part of what Summit was looking to do was determine how the system was going to work for agents. “It was a very agent-focused development from beginning to end,” says Houser. “Not only did the technology change, but we changed a lot ourselves.”