2011 Insurance IT All-Star: Larry Fortin

For example, the number of business segments Millers writes is relatively small, but Fortin knows insurance is a mature industry and the way insurance carriers are going to grow is by fractions.

"Predictive analytics is how you are going to advance over your competitors," he says. To be competitive in the market, Fortin is working to put a foundation in place to start analyzing 100 to 150 different segments of the business.

"Maybe you have a segment where a predictive analytics engine is telling you different characteristics you want to stay away from," he says. "You want to be able to react like that. We are spending money now with fewer business segments, but we know that's where we want to go. If you wait five years and put a new infrastructure in place it would be hard to go back and retro-fit. It's a fine line to hit the target you want to be at in five years without breaking the bank now."

Fortin is excited about the possibilities that mobility and social media can bring to insurers, but believes his biggest task is to have the policy system in place for the future.

"As we look at a new claims system we are bringing mobile apps in the equation now," he says. "I want to get the legacy system replaced so five years from now we can look at niche-type products to help our penetration into different markets. I want to easily provide the business with the data so we can react to where they want to go. It's difficult to do that. Looking at where we need to go eventually, but replacing the foundation at the same time is difficult."

One of the major initiatives at Millers has been consolidation of the systems. Fifteen years ago, reports Fortin, Millers was in 35 states with 1,500 agents and written premium of $18 million. In 2011, the carrier has 250 agents primarily operating in five states and $52 million in written premium.

"[Millers] reshaped the business and brought a finer-tuned focus on the IT side to help with the next evolution of the company," says Fortin. "They felt their ability to compete—by leveraging technology—wasn't where they needed to be. Their ability to leverage technology was on the lagging side of the bell curve and they wanted me to move it to the leading side and keep it there."

Fortin and the business leaders at Millers put together a six-year plan that basically started from the ground up. The decision was made to migrate to the server environment. The carrier built a new computer room with all new wiring and established a strong SAN environment, explains Fortin.

The first software purchased was to establish both an agency portal and an employee portal, with the two connecting in different ways. Following that, the company looked over its rating and quoting needs.

"At that time, (two years ago) we had our BOP line of business available online for our agents to quote," says Fortin. "We have since released a new online system for all our products, with the exception of umbrella. They can all be rated online."

A new underwriting workflow is now being installed and Fortin explains it allows Millers to use service providers to look for liens, bankruptcies, or collections in the business owner's history. The results come back through an XML schema where the information components are in a granular fashion so the carrier can determine if there are recommendations on the policy Millers can exit to an underwriter and if there are no recommendations and the risk is below certain thresholds and the series of rules Millers has in place, the policy will go straight-through.

From a business management perspective, Fortin explains Millers is a small regional carrier, but it has made it a priority to invest in the tools that make for the kind of future that the carrier envisions. At the same time, Millers is not so big that they have a lot of legacy systems they are trying to convert.

"We're at a unique time where we have some of the resources that we need to do the conversion, but not so much that it is cost prohibitive," says Fortin. "The management team here has seen to that. This isn't a push on my part; it's a pull on their part. They are extremely supportive and I have to work to keep up with them."

The vendor selection process was something Fortin had done as a consultant. He believes the key issues are to understand where the business is and where they want to go and what the proper IT strategy is to put in place to support the business.

Fortin places equal value on technology knowledge and leadership, particularly for a company the size of Millers Mutual.

"I've been given the opportunity to have a seat at the table with other managers so as we are looking at the business problems," he says. "I can walk away from those meetings and understand what makes sense from a business perspective as well as give my thoughts."

The group makes decisions on how something is implemented. Millers employs people with strong knowledge of the history of the company, where the data is, and an understanding of issues in the past.

"I want them to be able to say if you do what you are thinking about, here is where you will run into some issues," says Fortin. "Being able to tap into the IT resources that have been here for a while, those that are working in both worlds can bring some good insight. It's a great conversation to have because you don't want to find those problems in implementation you want them to be a part of the design up front."