The installation of a new claims system at Farmers Alliance Mutual Insurance (FAMI) is part of a technology modernization initiative to improve customer service in the entire enterprise, according to Andy Edwardson, FAMI's vice president of IT.
"The existing claims process was made up of a number of applications," he says. "To complete the process, you had to jump from System A to System B to System C. The Pipeline product [from BlueWave Technology] has provided one interface to manage all of that."
Two important points with the new claims system are, first, FAMI now has the ability to provide automatic coverage verification, and second, the system is a browser-based solution.
Under the existing system, "the majority of the claims process has taken place within the brick and mortar of FAMI," relates Edwardson. "Field adjusters send in information to complete the process. Pipeline gives us the ability to push that process out to the field adjusters."
What has made this project such a challenge for FAMI is the carrier decided in 2006 to begin an enterprisewide hunt for products to replace the claims, billing, and policy admin systems. "Basically, we want to do a complete refresh," says Edwardson.
Although FAMI wasn't necessarily looking for a best-of-breed solution, ultimately that is what the carrier settled on. "It became apparent each area had specific needs, and when we looked at some of the fully integrated solutions, for instance, the claims area may have recognized a product worked well for underwriting but had some shortcomings in the claims area," says Edwardson.
FAMI established some parameters in its search, continues Edwardson. "We felt we could move away from the mainframe and find products that fit well in a distributed environment," he says. "We let the claims guys find what they needed, and the billing guys find what they needed. And then off we went."
FAMI had not made any major software purchases prior to this project, so the carrier brought in a third-party organization to assist in the selection process. The entire process took about a year.
"Essentially, what we did was call the project iFAMI to integrate the people and the technology," says Edwardson. "We established a path for integration among these applications, and through the course of the selection process, we were looking for products that could integrate with one another via Web services. We found products in that arena, and then we built a phased approach for policy admin and the claims piece. We are by no means finished there, but we did a big-bang conversion with regard to the billing solution."
The vendors played well together, too, adds Edwardson. "The BlueWave developers communicated with the policy admin and billing folks, so it worked out pretty well," he says.
On the claims side, FAMI started with its smallest line of business–BOP–and phased it in. Currently, the carrier is working on a larger line, homeowners, which Edwardson predicts will be rolled out in the fall. The company expects to be off the old system in 2011 when it adds farm owners, its largest line of business.
"[Pipeline] has introduced efficiencies into the process, and we are happy with how things are playing out," says Edwardson. "Users are like kids in the candy store. They are excited about how the product will help them achieve results. We can't make it happen fast enough."
When everything is in place, Edwardson believes it will be easier for FAMI to bring in third-party information providers. "For years we've subscribed to products, and when we bring in that information, we have to massage it to put it in the system. Now, we just can reach out and share the information much easier. If we decide to change providers, we can make the shift much easier than in the past."
One lesson FAMI has learned from this experience is to take the project one step at a time.
"We initially had a grand plan laid out that was a little more than a three-year plan," Edwardson says. "We've realized we are better off looking at what we can handle in the next six months and get that implemented as opposed to a three-year plan."
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