A fitful start to rebuilding legacy systems eventually became a speedy claims management overhaul at Jacksonville, Fla.-based The Main Street America Group ($1.8 billion in total assets). After a growth phase in the late '90s, the insurer's various stand-alone, green-screen claims applications began causing inefficiencies, reports IT director Bill Garvey. "We needed to eliminate various manual interventions, such as assigning claims to adjustors," he explains. "And our ability to implement sophisticated Web-based interactions with our business partners, agents and policyholders was limited, or nonexistent, because our legacy systems weren't scalable."
A search for options began about six years ago. The carrier even considered developing a system in-house, Garvey recalls. "Eventually, we evaluated 15 vendors during 2003, but nothing fit," he relates. "Around this time, Guidewire approached us with its new Web-based ClaimCenter. Unlike other systems, which incorporated claims into lines of business, Guidewire treated claims management as a ... core application that spanned all business lines. Another key feature was robust rules-based claims assignment."
Despite the solution's benefits, a lack of production installs was almost a deal-breaker. Fortunately, ClaimCenter went into production at Hastings Mutual (Hastings, Mich.) in early 2004, and a due diligence site visit was arranged. "This absolutely changed the course of events," Garvey acknowledges.
By July 2005 Main Street America signed a deal with Guidewire and the transition finally began. First, ClaimCenter was loaded onto a dedicated Microsoft (Redmond, Wash.) server and the carrier upgraded its IBM (Armonk, N.Y.) WebSphere deployment, as recommended by San Mateo, Calif.-based Guidewire. Concurrently, a cross-functional implementation team split the project into three major phases.
"The first phase was property claims, which required 26 internal interfaces," Garvey says. "Guidewire representatives ... advocated using the 'agile' methodology, which further breaks down projects into 'sprints' [incremental development cycles]. In all, we completed 16 sprints during the first phase, some of which ran concurrently."
The first phase was finished in October 2006, on budget. The second phase, automobile lines, was completed by August 2007, with the final phase, workers' compensation, going live in February 2008. "Using sprints, we could demo something live to our claims department about every 30 days," Garvey says. "This permitted each sprint to build on what we learned from the one before."
As a result, Main Street America is reaping significant rewards. Rules-based automated claims assignment alone has reduced claim routing time from hours to seconds, Garvey reports.
"Also, our adjustors can stay focused on settling claims instead of answering inquiry calls," says Ted Orszak, claims operations director. "Since anyone with access rights can quickly determine the status of a claim, our call center has taken over handling inquiry calls -- which currently average about 7,000 per month." Ultimately, Orszak adds, the company will leverage the data captured in the system to improve product development, underwriting and pricing.
In the meantime, the insurer will further increase efficiencies by scaling the solution to include interfaces to external partners and providers, Garvey says. In addition, Main Street America will improve portals for agents and policyholders, he notes.
Case Study Profile
Company: The Main Street America Group (Jacksonville, Fla.; $1.8 billion in total assets).
Lines of business: P&C, auto and workers' compensation.
Vendor/Technology: Guidewire Software's (San Mateo, Calif.) ClaimCenter.
Challenge: Update and streamline claims systems and processes.
Anne Rawland Gabriel is a technology writer and marketing communications consultant based in the Minneapolis/St. Paul metro area. Among other projects, she's a regular contributor to UBM Tech's Bank Systems & Technology, Insurance & Technology and Wall Street & Technology ... View Full Bio