SAFECO Reaches Agents Via Web Channel

When Seattle-based SAFECO ($31.4 billion in assetts) purchased Indianapolis-based American States Insurance Co. inlate 1997, it increased SAFECO Surety's target market of fewer than 2,000 independent agents to roughly 8,000. But reaching a larger and diverse agent pool threatened to be difficult and costly.

SAFECO Surety's traditional account-oriented market consisted of agents specializing in surety business, says Greg Davenport, assistant vice president and director of surety operations at SAFECO. "The automation that we provided to those agents primarily consisted of an electronic bond form library"-a desktop application utilizing JetForm (Ottawa, ON) FormFlow technology, which had been provided to agents for almost 20 years.

With the purchase of American States, Davenport adds, "We were asked to cross-sell to all independent insurance agencies and we bought a book of business focusing on miscellaneous, or transactional business," consisting of low-cost, low-risk surety bonds. The challenge, he says, was to reach out to the larger, less business-specific SAFECO agent pool with a full line of products. The solution was the creation of Surety Online, a Web-based way to access the information.

Davenport explains that adapting the desktop form library for the new pool of agents' use would have cost an estimated $5.6 million, plus training. "What we did instead was leverage our investment in that library and in JetForm technology to develop an extranet." All SAFECO-affiliated agents can reach the application through logging on to the SAFECO Plaza agent Web site and clicking on the Surety Online Icon.

Using JetForm's e-Process framework, "Surety Online walks an agent through the procedure of requesting a bond with the minimal amount of information possible," Davenport says. Business rules are derived from the requested form, triggering a series of queries. "We greet the agent with a request, 'Tell us what state the bond is in, what type of bond it is.' We'll present panels that are tailored for that particular obligation," he says. The request is then run through business rules on the back end, Davenport adds, "and if it's approved, we deliver a completed bond package to them instantaneously."

The swiftness of the extranet application stands in sharp contrast to the way bond requests were previously handled. Agents would first call the central processing center. "They would contact Indianapolis by phone or fax; typically, a support rep would receive the bond request, examine it, and in many cases go back to the agent for more information," says Davenport. "The rep would then pass it to an underwriter. We would prepare the bond, then mail it. This process could take days." Through Surety Online, bonds are processed within 30 seconds, on average. "All credit reports are run automatically. We're able to do 90 percent of all requests in real time, which is pretty huge," he adds.

Surety Online was launched this past November, after a development period of about eight months. At press time it was available in four states, with rollout to all states planned to be complete by the end of the second quarter of 2001.

Implementation cost a fraction of the estimated cost of deploying the desktop application. Furthermore, Davenport says, "The incremental costs are zero. We literally can take this Web-based application from a few hundred agents to 8,000, with no additional cost." Since it's accessed through the Web, Surety Online requires no ongoing software distribution and maintenance outlay. "It's a much easier technology to support," Davenport says. "If it's compatible with their browser, they're in business."

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SOLUTIONS: AT A GLANCE

COMPANY NAME: Safeco Surety, a subsidiary of SAFECO Insurance Co. of America, Seattle, ($31.4 billion in assetts).

LINES OF BUSINESS: Surety bonds.

VENDOR/TECHNOLOGY: Surety Online application utilizing JetForm (Ottawa, ON) FormFlow technology and e-Process framework.

THE CHALLENGE: To extend surety bond library application to a greatly expanded target market.

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