Seeking greater functionality and user-friendliness, Automobile Club of Southern California (Auto Club, Los Angeles, Calif.) — the largest of member of the AAA federation of motor clubs — has chosen Guidewire Software's Web-based ClaimCenter solution to provide end-to-end claims functionality. The multi-state Auto Club has begun implementation, starting with consolidation of the legacy platform on the Guidewire platform. Auto Club plans to complete its first rollout of ClaimCenter within nine months, with a full implementation across all lines within two years.
The decision to replace its legacy system was based on Auto Club's belief that having more functional tools was an important criterion for being able to deliver competitive claims services in the property/casualty industry, according to Cortland Ray, vice president for claims, Automobile Club of Southern California. "We have several legacy mainframe claims systems that have been in place for 10 to 20 years, and we have also expanded in the market and acquired more claims systems in the process," Ray says. "The idea of our replacement strategy was to move to a platform that was more user-friendly and had more functionality."
Auto Club's current claims environment includes a significant number of manually-intensive tasks and does not permit real-time data sharing across the organization - a capability that that company has identified as key to providing competitive member service. In order to maintain its service standards, the company's leadership saw the need for consolidation and modernization of the claims environment. "We didn't want system or technology limitations to hinder our business growth or service capabilities," comments Michael Kerrigan, vice president and CIO, Automobile Club of Southern California.
The selection process for a replacement platform began over three years ago and was narrowed down to three finalists, according to Auto Club's Ray. The company "test drove" the solutions and ranked Guidewire's system first, based on several criteria. "One was Guidewire's track record in the marketplace with high recommendations, including the fact that we visited several other Guidewire customers in the course of our research," Ray relates. "Another criterion was ease of training, and a third was the ability to use the system 'out-of-the-box' without extensive customization."
Ray adds that Auto Club has verified that the training time for new claims adjuster hires on the Guidewire system will be reduced by more than 50 percent.
In addition to the elimination of manual tasks and the sharing of electronic claim files, the benefits of the Guidewire solution expected by Auto Club include improved claims practices through automatic assignment and rule-driven handling; enhanced management reporting capabilities with expanded data collection; reduced loss costs resulting from the ability to identify cost reduction opportunities and recoveries; and the reduction of IT maintenance costs by moving to a single modern platform for all lines of business.
Ray declines to share what the company is investing in the Guidewire solution but says that, "it certainly had to make the threshold of meeting a good ROI, but that was secondary to the fact that it could get the job done in the first place," he says. In turns of the magnitude of that job, Ray says that he expects the implementation "will likely have the biggest impact on claims workflow that we've seen in the last decade."
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