The New York State Insurance Department (NYID), which serves a number of constituents, aims to bring all of its offline capabilities online. The NYID fosters ideas for efficiencies through initiatives such as its planned council of insurance CIOs. According to the NYID's deputy superintendent and CIO, Ron Minafri (who has been CIO for six years), the insurance department is meeting its technological objectives in large part because of the superintendent's and governor's embrace of technology.
Ron Minafri, deputy superintendent and CIO, New York State Insurance Department.
I&T: As deputy superintendent and CIO of the New York State Insurance Department, what are some of your major challenges?
Ron Minafri: One of the challenges associated with my role is the NYID's personnel and procurement processes, which are somewhat antiquated. Both are currently getting reviews at the state level and the hope is that they will both undergo some improvement. Also, right now the department is struggling with the state budget, and that can inhibit all the critical things we need to do to support the program. Another challenge that I am experiencing is one that is not unlike one faced by organizations in the private sector, and that is supply and demand. Demand usually is much higher than our supply, so that is a juggling act. Additionally, time to market and managing continuity while creating change is challenging. It's like changing a tire on a moving car. I think that is something that all members of the technology world face.
I&T: The NYID has developed online licensing application technology and B2B e-commerce applications. What are some of your more successful e-commerce initiatives? Also, what are some of the efficiencies that have been gained as a result of their implementation?
Minafri: Without question one of the NYID's more successful e-commerce initiatives has been its licensing system that handles appointments, original licenses and renewals. It hooks up to the NAIC (National Association of Insurance Commissioners). The department has renewed more than 85,000 agent licenses in only a few months and 65,000 have been renewed by credit card. Numerous benefits have accrued as a result of the system. The NYID has received accolades from our insurance agents and brokers. And from the department's cost perspective, we have saved hundreds of thousands in cost avoidance, while at the same time increasing services to our constituents. While we were operating a paper-based licensing system, many of the applications would be incorrect or lacking information. We ended up having to send back about one-third of the applications. That had significant implications on the costs associated with postage and handling.
Another successful project was one that we implemented three years ago. It allows consumers to submit complaints, which are imported to our consumer processing system, and our work is started immediately. An additional initiative that was undertaken by the NYID is a system that licenses temporary adjustor permits in case there is some type of disaster. It was particularly useful after 9/11. Additionally, prior to 9/11 we established an insurance emergency operations center (IEOC). It was the result of a public/private partnership meant to address natural emergencies. Insurer participants were originally limited to P&C insurers, but participation has since been expanded to include life and health insurers. The IEOC features links to the State Emergency Management Office and a password-protected, secure section on the NYID's Web site (www.ins.state.ny.us/). It is used to communicate pertinent information to insurers. We had also established a physical workspace with Internet access for NYID and insurer representatives to use for receiving and communicating information electronically, in near-real time during an emergency. After 9/11 the IEOC was staffed 24 hours for many days. We received an award this year for the IEOC from the governor's office.
I&T: As of this past spring there were plans to create a council of insurance CIOs to discuss how the NYID can work with insurance technologists to discover opportunities where Web-enabling transactions will be useful. What is the status of this initiative?
Minafri: We have not convened the council yet. We are targeting it for this fall and the invitations are being drafted as we speak. We will group councils by sector: P&C, life and health. The councils will not just include technologists, but the CIOs will be accompanied by members of their company's business. Additionally, we will ask the department's licensing and consumer service bureaus to accompany our regulatory bureaus at these meetings because these groups represent the larger touch points of our major constituency. The councils will act as forums to exchange ideas on things that may be of mutual benefit for the department and carriers. There is a tremendous opportunity to leverage processes such as consumer imaging that deals with the complaints process. I believe that if we worked with various insurers we could make that much more streamlined and effective.
I&T: The New York State Department of Insurance serves a variety of constituents. How are business problems related to the IT department from these different groups?
Minafri: We do a lot of outreach to facilitate the communication of different groups. The superintendent and members of the individual life, P&C and health business bureaus and the consumer bureaus meet. We also get information from citizens and legislators. Demands from bureaus within the department and other state agencies like the DMV (Department of Motor Vehicles) place demands on our resources. The NYID has periodical demand meetings with different bureaus and their chiefs and executive deputies who look into their "crystal balls" and give IT a feel for what will be happening within the next 18 to 24 months. Technology changes so rapidly, so it's interesting to learn what challenges they have and what potential legislation may have an impact on IT.
I&T: How does the NYID determine which initiatives it will undertake each year?
Minafri: The initiatives that we will undertake are determined during the demand meetings that we have with our bureau chiefs. We have business and infrastructure drivers which play a large part in the way we tee up.
The events of 9/11 drive a lot of what we do. We've had to put a tremendous emphasis on business and planning. The NYID has established the NYIN (New York Information Network), which electronically reports potential cyber and physical threats the NYID receives from various sources. These reports are sent to approximately 1,500 carriers that do business in New York.
IT also works to focus on initiatives that will help lower our fixed costs, such as the resources drained from legacy maintenance. Lowering fixed costs will add to our discretionary funds. That enables you to implement technologies that drive effectiveness. These implementations help IT to emerge as a thought-leader and change agent.
I&T: It seems as if the New York State Insurance Department is on the leading edge, compared to other state insurance departments. How did it become this way and why is it one of the most technologically progressive departments?
Minafri: Several factors play into that. Leadership, including the superintendent's and governor's embrace of technology, plays a key role. I report to the executive bureau and I have a seat at the table, so IT is acknowledged as very important. The technological advancement of the NYID also has to do with our clients' visions and their willingness to partner with us. Additionally, the Department has a dedicated technology staff. Because I've spent most of my career in the private sector (Editor's note: Minafri held technology positions at Simon & Schuster and Hoffman La Roche), when I joined the public sector I was somewhat suspicious of the workforce and how good it was. The people that I work with are really outstanding. From where I sit I see many dedicated IT employees who are doing things to help the public good.
I&T: What role if any, do you play in determining technological regulations by which carriers that underwrite in New York must abide?
Minafri: I do play a role, but more in a consultative capacity. I helped establish guidelines for insurers to follow for Y2K compliance, and also evaluated insurer Y2K remediation plans. Similarly, the NYID issued a circular letter requesting copies of insurer disaster recovery plans and yet another circular letter alerting insurers of their obligation to comply with HIPAA legislation.