Seeking to enhance its reputation for fast and fair claims resolution and build efficiency and systems flexibility into its future, Sarasota, Fla.-based P&C insurer FCCI Insurance Group ($550 million in annual premium) has implemented Guidewire's (San Mateo, Calif.) ClaimCenter to replace the carrier's three legacy claims systems. The Feb. 1 2008 launch of FCCI's first line of business marks Guidewire's 30th customer to go live on the system.
FCCI's ClaimCenter implementation is planned to provide end-to-end claim processing for all of the carrier's lines of business by 2009. According to the carrier, ClaimCenter will integrate with FCCI processes and systems at 12 key points, including policy administration, document management, check printing and the insurer's data warehouse, as well as with external business partners and data sources.
FCCI's selection of Guidewire sprang from a systems evaluation plan begun in 2004 to establish what the company calls its "2010 vision." In 2005, through an RFP process, FCCI set out to explore the possibility of acquiring a single system for multiple functionality, including claims, underwriting, billing and agency interface, according to Brenda Davis, CIO, FCCI.
"What we found was that there was not really a solid vendor that could cover all of those functionalities cradle-to-grave," Davis comments. "That's when we made the decision to find the 'best available' in each of those functional areas, and then our IS department would be the integrator that brought those different best-available systems together."
After rejecting any of its three legacy claims systems — two of which ran on the AS/400 platform, the other being server-based — FCCI began a search for a new claims system. The carrier considered about 10 claims systems, grading them on financial, technology and business functionality criteria, and putting them through the paces in on-site demos and Internet-based "playgrounds," according to Garth Crow, vice president, claims, FCCI.
After narrowing the field to four finalists, FCCI selected Guidewire in late 2005 and signed a contract in March 2006. Guidewire ended up meeting the carrier's financial standards and technology compatibility concerns and performed better from a functionality perspective, according to Crow. "Some of the other systems we considered may have handled a certain line of business better but only Guidewire performed consistently across all lines," he says.
Choosing a line-of-business rather than a regional approach to implementation, FCCI rolled out ClaimCenter for commercial auto on Feb. 1. The carrier is scheduled to go live with general liability in July, umbrella in September, property in October, and its final line, workers' compensation, after the turn of the year. "We have not done any conversion but are basically shutting down our other systems and only allowing new claims to be entered within ClaimCenter," Crow relates.
FCCI's Davis explains that the project began in June 2006, and the more rapid rollout dates for subsequent lines of business are owing to the carrier's having simultaneously implemented an operational data store, as well as needing to master the implementation process. "We think we have that process down now, hence the more aggressive date for the second deliverable in July," she says.
About a dozen FCCI employees worked on the claims system implementation team, along with up to four Guidewire consultants, depending on the project stage. While a Guidewire consultant played a key role in the effort to integrate ClaimCenter with FCCI's systems and processes, that aspect of the initiative was basically done on an in-house basis, according to Robin Huff, project manager, FCCI. "That was one of the more challenging aspects of the project," she says.
By contrast, FCCI's team found Guidewire's product configuration tool unexpectedly easy to work with. "The team that worked with the tool was very impressed with the tool," Huff comments.
"We were able to implement the entire [commercial auto] line of business with no true vendor customization," Davis adds.
Davis identifies as another benefit Guidewire's commitment to to passing onto FCCI the necessary skills to maintain and expand ClaimCenter. "They have left the knowledge and expertise with our staff, so we feel very confident about addressing future lines of business pretty much independently of Guidewire," she says. "There's nothing worse than a company being held hostage to a vendor because you can't move as your company changes."
Davis declines to comment on what FCCI invested on ClaimCenter specifically but says that in 2006, the carrier committed to investing $6 million on its systems improvement initiative, of which ClaimCenter was a part. Davis identifies the implementation as one of the carrier's three key ongoing 2010 Vision initatives, along with billing and operational data store, and characterizes the investment as a moderate one, given the size of the carrier.
"We feel strongly that we got value for our dollar for both the software and the services," Davis adds. "We feel that we can pretty much be self-sufficient and not have to rely on third parties to help us maintain or expand the system —unless we choose to because we want to speed up the timeframe."
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