When Royal & SunAlliance (R&SA, Charlotte, NC, $9.2 billion in assets) launched REMi (Royal Equipment Maintenance Insurance), an underwriter of insurance policies for equipment maintenance, it did it from scratch.
Dan Schuster, vice president and general manager, REMi, was hired in 1998 and began defining what REMi's IT capabilities would be. Schuster, who worked previously for two of REMi's competitors, brought with him insights about ways to achieve competitive advantage. "What slows down a lot of our competition is, people call in for reports and someone has to type a cover letter and go run a report," says Schuster. "Basically, I want to only have to touch a piece of paper once. When someone pays a claim I want it paid electronically. I want the client notified via e-mail. I want to post it online."
Finding a Solution Provider
Schuster showed his plan to Royal & Sun's IT organization, which, while it couldn't complete the project in the time allotted, pointed him in the direction of newly formed Mariner Systemsa provider of project-based application development solutions. Schuster, impressed by Mariner's consultative approach, agreed to work with the vendor. A few weeks later, discussion moved towards systems solutions.
"It took us about 60 days, to move forward with a design," explains Schuster. "The idea was if we did the up-front work well, we wouldn't have as many mistakes downstream, and that really has been the case." REMi and Mariner planned to take customer service elements of the claims processing and policy management systems and place them in the clients' hands via B2B commerce.
The plan for EMMA (Equipment Maintenance Management Application) was finalized that summer and the project went into full development mode. Schuster was given two options regarding the system's rollout. He could either wait and have the system go live in its entirety, or have each piece rolled out upon its completion. He chose the latter, in which phases of the claims process would be broken into three and then rolled out upon their completion. Then another piece of the projectfor instance, the underwriting elementwould be rolled out in phases. "Basically, I just didn't trust," laughs Schuster. "I used to write code myself and I was always suspicious that engineers and coders will sit on something until it's perfect. I couldn't wait, because I had to meet my obligations to the company."
By early fall Mariner had pieces in place to automate the business process. Over the next two years the different pieces of EMMA were rolled out. Currently a lot of work is being done with the online piece of the system, which services insureds and producers. It runs entirely on Microsoft (Redmond, WA) architecture, reports Jim Dapolite, REMi's technical services manager. The SQL server running the system is located in Royal & Sun's corporate office and all of the applications run over the LAN. Training for the system's internal users, underwriters and their support staff, as well as engineers and claims staff, was provided by Mariner.
The only unanticipated part of EMMA's implementation, according to Dapolite, had to do with the speed of REMi's network and infrastructure. "When Mariner developed the application they did it in Mariner's client/server environment, which was running at 100 MB," says Dapolite. "We anticipated that it would run the same here; it ran somewhat slower."
The Need for Speed
The problem was addressed last year when corporate IT decided to move all production servers, including REMi's, to the home office. However, running the application over a T1 line actually degraded performance. After a few months, the line was upgraded to a T3 over ATM (asynchronous transfer mode) and EMMA was retooled to run at lower bandwidths.
According to Dapolite, an advantage of EMMA is the huge gain in processing efficiency and customer self-service. "One of our competitors has two-and-a-half times the employees we do, the other has twice the amount, and they" don't have as much business, says Schuster. REMi's customers are also reaping the benefits of EMMA. "With this self-service approach customers can get more information that is more readily available," says Schuster. "We have closed a number of big deals because of EMMA. "We didn't know it would provide a marketing advantage."
CASE STUDY CLOSEUP
Royal Equipment Maintenance Insurance (REMi, Charlotte, NC).
LINES OF BUSINESS:
Equipment maintenance insurance.
Mariner (Charlotte, NC), a provider of application development solutions; Microsoft (Redmond, WA) SQL-based architecture.
Create claims and policy self-service capability.