After owning several diverse businesses - including two gas stations, a laundromat and a car wash - Arlend Floyd, now CEO of Simple Insurance, decided to give insurance a go on the advice of a friend. He began his insurance career in 1998 as an agent at City Insurance, a brokerage in Las Vegas. Within 18 months, he was part owner of the company.
Then, in 2000, Floyd founded Simple Insurance ($12.5 million in annual written premium), a Las Vegas-based carrier that handles mostly personal automotive lines, with some commercial customers in the Las Vegas area. "I founded the company because Las Vegas is growing at such a fast rate and friends of mine in insurance continually told me how busy things were," says Floyd.
Simple Insurance distributes through captive field agents and existing contacts, many established by Floyd at City Insurance. "Auto is our core business and a niche we moved on for two reasons: One, I had many dealer contacts from my previous insurance job, and two, the law in Nevada is that you must carry auto insurance or you will be fined," explains Floyd. "If your insurance lapses, then an insurance company can report you and you get fined right away," he says. "It is a very tight system."
A booming market for auto insurance offered Floyd a business opportunity with lofty goals - the company is targeting 1,500 new customers per month by the first quarter of 2006. To accommodate such growth, Floyd knew he needed flexible systems.
According to Floyd, Simple Insurance was built around a paper-based filing system and an accompanying, adaptable database that contained electronic copies of the data and provided a way to start out small but leave room for growth. The database was created with a growth-possible vision by Floyd using Microsoft's (Redmond, Wash.) VisualBasic. (The name of Floyd's database? FDS, for Floyd Data Systems, of course.)
Although Floyd gained some technical expertise through intense research and building databases hands-on, he had the vision to take on strategic technology partner SIMCO (Las Vegas), a computer systems and integration company that helped put together Simple Insurance's network. Together, they positioned FDS for growth.
The basic database was a sufficient means of record storage during the company's early years, but, as Floyd predicted, Simple Insurance has grown rapidly. Thanks to his foresight, the insurer has been able to modify the system easily and accommodate the influx of new data. "The FDS database has been in place since Day 1, but it started out very generic and has evolved every year since," relates Floyd. The system began as a way to keep track of commissions, and from there it mushroomed into a way to record the company's entire account payroll and finally into its existing configuration - a full-on account management system, according to Floyd, who chose a Microsoft-certified business partner in SIMCO to provide his company with a top-tier, vendor-supported, flexible technology platform.
Simple Insurance's IT platform currently consists of four Dell (Round Rock, Texas) servers, two of which are network attached storage units (NAS), each having a one-terabyte capacity to store and back up images saved as TIFF files, running on Microsoft Windows 2000. Floyd explains that the images are scanned copies of customer applications often containing photos of vehicles, driver's licenses and car registrations. The NAS servers rely on the Windows Small Business Server 2003 operating system to integrate with the local area network (LAN) server. They use Windows 2003 to integrate with a terminal server that now runs the FDS database using document management software from Cabinet NG (Athens, Ala.), extending data availability to both Simple Insurance's remote office, also located in Las Vegas, and the main office.
By 2003, Simple Insurance was handling more than 36,000 paper-based files and the flood of paper was growing at a rate of 1,000 new customers per month on average. Maintenance costs and paper continued to pile up and office space was shrinking rapidly. "We went about three years with paper-based filing alongside the database, and in that time frame we filled one entire room with nothing but files," reports Floyd.
The integration of Cabinet NG's software was a seamless step to streamline document management; with the addition of Fujitsu (Tokyo) scanners, the company has managed to get rid of about half of the old file store. However, Simple Insurance is still cramped, Floyd continues. As a result, the company is preparing to add a third facility with definite plans for a fourth. "In our building right now we are maxed out," notes Floyd. "We are squeezing desks where desks can't go."
Floyd spent about two months researching solutions, eventually selecting Cabinet NG's document management platform because it integrates easily with his existing database, is capable of growing with the business and offers quick customization, he relates. "They actually have the source code to go directly into our IT network, both FDS and the NAS severs, and pull a complete file into their database," Floyd explains. "Normally, end users would have to open up my database to get the customer file, and then they would have to go through the other databases to search images," he continues.
Now, digitized documents are integrated into the company's business process. End users are connected to Cabinet NG through the terminal server that houses the Cabinet NG application and FDS. Employees can connect to the terminal server, which is based on Windows, from their desktops through the LAN. "So, as far as a third location is concerned, we are set and ready to go," Floyd notes. "It is just about hooking up to the local network to access FDS."
The Cabinet NG software allows Simple Insurance to define its own workflow for documents and organize files and data in a way that compliments the existing process. The solution also leaves security at the carrier's discretion through the ability to assign access rights at the cabinet folder and file levels with an automated log of user activity.
Using 10 of 26 different indexes provided by Cabinet NG, Floyd wrote a script for file organization that applies to all customers in the FDS database. Cabinet NG then automatically collected the information and created indexed files for each customer in about 10 minutes total, according to Floyd. "I didn't have to go back and write a new file for each customer, and now every time a customer is entered into FDS, Cabinet NG will automatically create a file for them, which is kind of a seamless factor," Floyd reports.
Simple Insurance, which has an annual IT budget of about $25,000, hasn't manually entered a file in the database since March 2004, and the stacks of paper files have been dwindled down to about half of what they used to be, according to Floyd.
Simple Is as Simple Does
The goal at Simple Insurance is, as its name implies, to keep it simple. "I'm going to stick with Microsoft operating systems and Cabinet NG because they make the addition of new business efficient," explains Floyd. "When we alleviate bottlenecks, that's when I know we've made a good decision," he says. "We try and complete all of our business on a daily basis, with nothing flowing over into the next day. If we close our doors at six o'clock and people are still lingering around at 7:30, we know something has to change."
The most difficult challenge for the carrier associated with its rapid growth and the implementation of the Cabinet NG document management system, Floyd relates, has not been the technological aspect, but the meshing of technology with people. "We have been doing a lot of training, mostly through holding meetings," he says. IT issues simply are handled as they arise.
The informal nature of IT's agenda points to Floyd's - and the carrier's - willingness to adapt and make changes as business conditions dictate. "I try to make technology decisions based on improving efficiency, saving space and not having to add too much to our staff," says Floyd. "We always need a system or a routine to minimize the administrative duties that could be streamlined."
Company: Simple Insurance (Las Vegas; $12.5 million in annual written premium).
Lines of Business: Primarily automotive personal lines.
History: In business since May 2000, Simple Insurance has two offices in Las Vegas and plans to expand to four offices in the Las Vegas area by the first quarter of 2006. The carrier currently has 28 employees and an IT budget of $25,000 per year.
Recent Initiatives: Simple Insurance recently added a document management software solution from technology vendor Cabinet NG (Athens, Ala.) to improve daily operations, reduce the cost of paper maintenance and provide improved service to a fast-growing client base.
Name: Arlend Floyd, Founder and CEO
Career Path: After owning several diverse businesses in California - including two gas stations, a laundromat and a car wash - Floyd chose the insurance business on the recommendation of a friend. In 1998, he began his insurance career at Las Vegas-based City Insurance, of which he eventually became part owner. In 2000, he started Simple Insurance, which is growing at a rate of 1,000 customers per month.
IT Philosophy: To increase efficiency and alleviate bottlenecks through the deployment of technology that has the ability to grow with the company. "I try to make technology decisions based on improving efficiency, saving space and not having to add too much to our staff," says Floyd.