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Policy Administration

03:22 PM
Johannah Rodgers
Johannah Rodgers
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Productivity Soars at Magna Carta

The commercial insurer uses an integrated insurance management system to increase business process efficiency in the midst of workforce reductions.

In 1996, when David Lawless, senior vice president and chief administrative officer, Magna Carta Companies (New York), took over the management of the insurers IT functions, he had two problems to solve. The first was a shrinking workforce that had recently been reduced from 600 employees to just over 200. The second was that he and his staff were spending a great deal of time cobbling together different applications and writing interfaces because they were running multiple insurance processing systems.

"We had to integrate the various platforms into a more cohesive and efficient system," explains Lawless. "The technology also had to catch up with the business reality of far fewer staff covering the same policy count."

The technology also had to support the insurer's expansion toward the West Coast.

Finding a good billing system was a priority but, according to Lawless, "nobody had a good stand-alone billing solution." He then decided to look at integrated policy management systems from PMSC (now CSC, Columbia, S.C.) and Allenbrook (Brunswick, Maine).

Lawless and his team eventually selected Allenbrook's Phoenix suite of applications. An integrated client/server solution, Phoenix manages all aspects of policy administration, claims and billing. The application includes development tools for customizing application modules to the needs of different clients. Enabling a single user to enter, underwrite, process and instantly issue a policy, Phoenix will, once the policy is issued, automatically update all related billing, claims, rating and premium information.

Lawless estimates that the first product line took six to eight months to implement. He is quick to add, however, that given his IT team's current familiarity with Phoenix, a new line of business could be up and running in "less than 90 days."

Magna Carta Companies has an IT staff of 16 people. During the initial implementation of the Phoenix system, six full-time people from Magna Carta and five from Allenbrook were assigned to the project; just four internal staffers currently maintain it. Deployed to the company's 225 users via a Web-based Citrix interface, the Phoenix application runs on four IBM x-series servers running VMware ESX, virtual machine-ware that optimizes performance and maintenance for multiple applications running on single machines. The Phoenix application also interfaces to an Oracle 9i database running under a Linux 2 terabyte storage area network.

More With Less

By automating and integrating business functions, the Phoenix system allowed Magna Carta to do more with fewer employees. "We reduced our policy issuance time from two weeks to two hours, and we were also able to bill clients the same day."

Lawless praises the Phoenix system for being "both highly customizable and scalable." But he cautions that because Phoenix is highly flexible, "you can make your life as easy or as difficult as you desire with the system." It is important to know which parts of the application suite need to be customized and which can be left alone. "You don't want to waste a lot of time customizing specific modules [to] mimic your existing process when this software provides an out-of-the-box solution that may work just as well, or even better."

Magna Carta's willingness to change its business processes was key to the success of the Phoenix project, says Lawless. "Rather than using technology to mimic outmoded paper-based models as our predecessors had done, we used the Phoenix installation as an opportunity to review and make changes to our internal organization," he says. "We made effective changes that enabled us, a company of 200, to function more productively than we had with over 600 employees."


COMPANY NAME: Magna Carta Companies, New York.


VENDOR/TECHNOLOGY: Allenbrook (Brunswick, Maine) Phoenix 7.0.

THE CHALLENGE: Implement an integrated commercial insurance management system to improve staff productivity, business efficiency and customer service.

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