By combining imaging and workflow capabilities, West Bend Mutual Insurance Co. (West Bend, Wis., $1.02 billion in assets) was not only able to replace increasingly inadequate document management systems, but also to reach new levels of efficiency. West Bend's document technology had been spread over two separate systems, relates assistant vice president Chris Zwy-gart. "One handled all our policy information in print streams from our policy issuance system. We had a separate system that handled paper documents received by mail," he relates. "These systems didn't talk to each other and were not user-friendly." And, he adds, "they were just plain slow-retrieval time was terrible."
To find a solution, Zwygart directed a project to replace the systems. He began by identifying requirements for a new system. "We started with what the users wanted and developed a sophisticated sheet of requirements for all users, from underwriters and assistants all the way down to IT-the folks who would have to support the system," he recalls. "One of the things we were looking for was a system that could handle-both from a user and an IT perspective-a single repository for documents, whether they were scanned or print-streamed."
After issuing an RFP, West Bend considered eight top competitors, finally settling on a TOWER Technology (Boston) solution. However, Zwygart says, "TOWER was not the most inexpensive option, so we needed to cost-justify it." The carrier was helped in that task by a consultant from Robert E. Nolan Co., Inc. (Dallas), who demonstrated that a TOWER solution would result in a two-year return on investment, based on its implementation in the carrier's two largest departments: claims and commercial lines.
In September 2000, West Bend licensed TOWER's document management solution suite, which included, on a reseller basis, a Staffware (New York) suite of products that would enable the carrier to develop and implement workflow on a day-to-day basis, Zwygart says. Hardware investment included six color scanners, redundant Unix servers, a RAID 5 magnetic storage box and two opticaldisk jukeboxes with 2.1-terabyte capacity.
Overcoming Rollout Resistance
West Bend implemented the solution first in its personal lines underwriting department in May 2001. Zwygart acknowledges there was resistance, and difficulties with the workflow portion of the rollout resulted in its temporary withdrawal. But users who had resisted the new system then clamored for its return, which came in August '01. "In a short time, they had learned to like it," Zwygart observes.
Rollouts followed with P&C claims in April 2002 and commercial lines in May 2002. Backscanning-or scanning of formerly microfilm documents-of archived workmens' compensation began in December 2002 and continues today. Live scanning and workflow of workers' comp began on a geographically based team-by-team basis in January 2003, with the last team online by January '04. "We also did a conversion from our old imaging system that handled the COLD [computer output to laser disc] documents," Zwygart says.
This January the carrier rolled out the capability for agents to access personal lines documents over its Internet portal. West Bend is expanding that capacity to include commercial lines and is also exploring the possibility of extending access to insureds. "If it makes sense, we'll do it," says Zwygart. "But we don't want to interfere in the relationship between our agents and insureds."
While the cost-justification study by Nolan predicted the elimination of 58 full-time positions, things didn't exactly work out that way. Since the time of the study, explains Zwygart, "We went through a phenomenal growth spurt," from premium income of roughly $300 million to nearly $570 million in 2003. "But while we nearly doubled in size, we didn't have to double our staff."
By recovering storage space, the carrier also avoided expansion of its home office. "We were able to empty out these huge file rooms and convert them into more usable space," Zwygart says.
CASE STUDY CLOSEUP
COMPANY: West Bend Mutual Ins. Co., West Bend, Wis., $1.02 billion in assets.
LINES OF BUSINESS: Personal and commercial lines property & casualty.
VENDOR/TECHNOLOGY: TOWER Technology (Boston) IDM software; Robert E. Nolan Co., Inc. (Dallas), professional services; Staffware (N.Y.) workflow software.
CHALLENGE: Implement a scalable document imaging system including workflow capability.
Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio