Although it works with a modest budget, Cincinnati Equitable is able to cater to agents' needs.
In the fight for independent agents' business, Cincinnati Equitable's (Cincinnati, Ohio, $36 million in assets) Terry Brown is armed with a modest technology budget that is only a fraction of the IT funds allotted to competitors such as Travelers Property Casualty. But, what this vice president of IT lacks in financial resources, she makes up for in other parts of her arsenal.
As a former agent who has experience in underwriting, marketing and policyholder services, Brown has the business acumen necessary for heading the IT shop of the carrier that counts independent agents as its sole distribution channel. And, like Brown, the carrier is no stranger to experience. Cincinnati Equitable holds the distinction of being the oldest underwriter in Ohio, and west of the Allegheny Mountains. The original product offered by the 177-year-old carrier was a perpetual fire policy, which at the time was a unique concept developed by Benjamin Franklin, relates Brown.
"Today Cincinnati Equitable is one of the few companies that still offers that product," she says. "In fact, the company has one policy, on a local church, that has been continuously in force since 1837." Throughout its years of operation, Cincinnati Equitable has added personal P&C coverages, including preferred and non-standard automobile, homeowners, inland marine, watercraft and personal umbrella products, to its list of offerings. The insurer counts Grange Insurance (Columbus, Ohio), State Auto Insurance Co. (Columbus), Travelers Property Casualty Corp. (Hartford) and The Ohio Casualty Insurance Co. (Fairfield, Ohio) among its biggest competitors.
Armed with a staff of eight and a yearly budget of $1.2 million, Brown concedes that her biggest challenge is "meeting the varied needs of the agents on a small budget," she says. "We work with big and small agencies. Some are highly automated and some are not. Somehow we need to provide both groups with the tools that are necessary to write business with us."
Both Sides of the Fence
Luckily for Cincinnati Equitable, Brown has experience as an agent. As a result, "I have a pretty good understanding of [carrier] workflow and agent workflow," says Brown. "I know about customer needs and how to apply the technology to do what they want to do."
Although it's based mostly on experience, elements of Brown's knowledge are gained through technology surveys administered to agents. "We survey agents to get a feel for where they are [technologically]," says Brown. "This information helps us gauge whether certain technology implementations will work for them." Cincinnati Equitable's agent advisory council also helps the carrier with its focus on improved agent relations. The group acts as a sounding board for new ideas. They also let the carrier know where improvements are needed.
As a result of its efforts, the carrier is making strides toward its goals of retaining its strong regional presence, profitable business and successful agent relations. It's done this by allocating most of its funds toward technologically enabling information exchanges with agents. In fact, its three latest technology implementations have centered on agents' needs.
For instance, as part of its response to the more-automated agencies, the underwriter has establishment an agency management system interface via IVANS' (Old Greenwich, Conn.) Transformation Station. Transformation Station is a data exchange service that provides agents with access to policy information like documentation, billing details and claims reporting capabilities.
Additionally, through work with IVANS and vendor partner Applied Systems (University Park, Ill.), the carrier has established batch downloading capabilities for importing data into the agency management systems of its producers. Brown reports that the capability utilizes ACORD's (Pearl River, N.Y.) XML and AL3-standards that focus on the communication between property/casualty insurers and their agents.
For agents who are less technologically inclined, the carrier's Web interface provides real-time access to policy information. Brown relates that the Cincinnati Equitable hired the development firm Interactive Business Systems (IBS, Oak Brook, Ill.) to perform the Web development work necessary for the implementation. In order to ensure the success of the project, Cincinnati Equitable "took advantage of IBS' ability to help establish focus groups of agents and internal users so that they could develop what was expected by users," says Brown.
So far, the project, which was completed in April 2002, has been received favorably by agents. "We've received huge complements on the system," relates Brown. "Agents say that it's so easy to use." The Web capability has also helped Cincinnati Equitable to reduce its costs. "It cuts down on the number of times that agents have had to call us, and as a result it has helped us to pay closer attention to sales efforts," says Brown.
Additionally, the carrier currently is finishing work on a consolidation plan that will make doing business with Cincinnati Equitable easier for its agents. According to Brown, the underwriter acquired Lakeland Insurance and Southern Michigan Insurance within the past five years. It's now in the process of consolidating the data of all three companies onto a common N-tiered client system.
The core system for the consolidation is Applied Systems' Diamond System, which handles policy processing and management. "We decided to move the two [acquired] companies off of the old technology because it was limiting," Brown reports. "The Diamond System allows us to do all the real-time processing and interfacing that we need."
So far, Cincinnati Equitable has completed 75 percent of the job, which began 18 months ago. "The data conversion process has been very successful," says Brown. "It has required relatively little data cleansing." As a result, the impact felt by agents has been minimal. But that doesn't mean that the process has been free of difficulties. Brown relates that the hardest part of implementation has to do with expediting projects while producers eagerly await functionality improvements. And, for the time being, Cincinnati Equitable's producer force will have to wait for future enhancements that will include real-time quoting and policy issuance for new business and endorsements, says Brown.
Lean and Mean
But with a limited budget, Cincinnati Equitable must make its technology investments carefully. The carrier is able to make enhancements due to a strategy that limits the number of vendors with which the underwriter works. According to Brown, working with multiple technology vendors can sometimes prove to be costly.
"Sometimes carriers set down a certain [implementation] path that requires enhancements from every vendor partner in order to finish the project," contends Brown.
As a preventative measure, the carrier's vendor partnerships are limited to IBS and Applied Systems. The two vendors also engage with the carrier on a consultative basis. The partnerships have been very successful because both organizations are aware of the Cincinnati Equitable's budgetary restrictions, according to Brown.
"[IBS and Applied Systems] are helping us to select our technology as we go forward," Brown explains, adding that the companies are involved in the insurer's budget planning process. In addition to the vendors, Cincinnati Equitable's CEO, Jim Ketring, CFO Greg Baker, plus Brown and the carrier's marketing and sales project manager, take part in the process.