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Torchmark Sends Reconciliations to the Cloud

A high-volume data matching solution helps the insurer improve efficiency and reduce risk.

When spreadsheet-based reconciliation began creating significant bottlenecks at McKinney, Texas-based Torchmark Corporation, the organization sought to modernize. "Manual matching tasks were slowing our rate of efficiency," recalls Stephen Davis, reconciliations manager for the insurer, which includes life and supplemental health insurance carriers spread from Oklahoma to New York. "We needed a solution."

In a journey that began in early 2010, a five-person business and technology liaison team started by identifying and evaluating four suitable SaaS-enabled reconciliation and data matching solutions. The field was narrowed to two contenders before ReconNET by Trintech in Addison, Texas, was selected.

"Not only was the interface straight forward, but also the matching functionality could be optimized according to our needs," explains Rick Mayton, senior VP for general accounting and cash management for United American Insurance Company, one of Torchmark's five primary operating subsidiaries. "In addition, Trintech was able to answer all our questions and provide solutions for everything we proposed."

An enthusiastic user base was also key. "Current Trintech clients reported high levels of service and support," says Davis.

After inking a deal for ReconNET, the implementation kicked off in October 2010. With vendor representatives joining the corporate team, data streams were identified and provided to Trintech.

In all, 2,300 accounts were planned for migration onto ReconNET when the project began. "We started with 60 cash accounts and another 100 suspense accounts," says Davis. "Those accounts were located in our corporate offices, making them the most familiar to the team."

Once the first set of accounts went live successfully in early February 2011, the team turned to a group of 50 insurance premium accounts that were too large for spreadsheets.

"Since the volumes in those accounts were hundreds of thousands of transactions a day, the challenge was minimizing the percentage of exceptions that ReconNET generated for manual research," Davis says. "Fortunately, during the deployment process, Trintech introduced a dual-source matching capability that drove up automated matching to 98.8 percent."

Early wins fuel enterprise-wide adoption
After these two wins, the team began moving through remaining business units. Then in late 2013, with most accounts on ReconNET, it discovered the new system could be extended to controllers as well.

"We had also adopted Trintech's Certification module for our compliance and financial analysis," says Davis. "We realized we could provide controllers with policy-based access to the Certification dashboard, enabling them to drill down to individual items and their reconcilers."

Along the way, the only real hurdles were normalizing disparate data streams from multiple legacy and modern systems. "Trintech helped us resolve all of those challenges very quickly and efficiently," Davis says.

"In fact, our only real concern was user adoption," he adds. "But, when we showed people how easy Trintech is to operate, they were so excited it made us feel like heroes."

Another plus has been the vendor's rapid, user-driven development. "We actively participate in the user community, where Trintech readily shares its enhancement schedule," says Davis. "Smaller hot fixes occur as quickly as Trintech can roll them out. And, so far, major updates have occurred at least once a year."

Today, approximately 2,600 accounts require reconciliation, of which over 2,300 have been migrated to ReconNet. "We're on track to complete the conversion by late this year or early 2015," Davis says.

Unsurprisingly, ReconNET has transformed accounting processes while simultaneously reducing risk and improving compliance. "For cash account reconciliation, alone, the reconciliation process went from weeks to daily," says Davis. "Even large premium accounts are reconciled daily."

"We not only know right away when any item is outstanding," Davis continues, "but also our compliance staff has complete transparency into every reconciled item. With hundreds of thousands of items to reconcile daily, having a comprehensive solution certainly adds to efficiency and profitability."

Anne Rawland Gabriel is a technology writer and marketing communications consultant based in the Minneapolis/St. Paul metro area. Among other projects, she's a regular contributor to UBM Tech's Bank Systems & Technology, Insurance & Technology and Wall Street & Technology ... View Full Bio

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