It’s Electric

To reduce operating costs, improve customer service, enhance underwriting consistency and strengthen its relationships with its agents, Austin Mutual Insurance ($72 million in assets), a Minneapolis-based P&C insurer, converted its manual, paper-based application process to a Web-enabled business submission system, according to Gary Franssen, the carrier's assistant vice president, IT. "A lot of our competitors have Internet sites for getting business in the door, and they were gaining an advantage by doing business online," he says. "Our agents were telling us they couldn't do business with us because the marketplace environment was changing."

Many of Austin Mutual's agents complained that keying information into the carrier's DOS-based system, uploading it to the company - where it would be rekeyed into a database - and waiting for a response took too long, Franssen notes. So, in 2003, Austin Mutual began searching for a vendor to build a customized online policy administration system to provide agents with real-time quotes.

The challenge was finding a product to interface with Austin Mutual's CSC (El Segundo, Calif.) POINT System - the back-end system that processes applications, rates policies and enables fulfillment - which operates on an AS/400 platform. To find a solution, Franssen tapped his previous experience. While working for another carrier, he had set up a personal lines system with a team at Born Technology (Minneapolis). Those developers now were working at business and IT services firm Keane (Boston), which offered to build the carrier a Microsoft (Redmond, Wash.) .NET-based, Web-enabled policy administration system.

"The Web-enabled system would allow a user to come into the browser and submit business to the company online" and in real time, Franssen says. Because of his prior relationship with the developers, Franssen hired Keane in March 2004 to build the new business submission system without considering other vendors.

Keane developed the policy administration system, which included an automated rules engine, and installed it on Austin Mutual's server by June 2004. Keane's programmers then began mapping the back-end business processes on the insurer's CSC POINT System and matching them to a Web-based interface.

In July 2004, Austin Mutual conducted a trial run of the product with 40 test agencies. "The agents had used similar systems with competitors and gave us a lot of ideas," Franssen relates. Keane's programmers customized the rules engine to populate the back-end system with information captured during the submission process so it did not have to be rekeyed. "The system was built so intuitively that for the agents, there was virtually no training involved," Franssen asserts.

In December 2004, Austin Mutual's agents and underwriters participated in a two-day training course, and, in January 2005, the carrier went live with the solution for auto insurance. All lines of business were running on the system by this past July, Franssen relates, noting that the overall cost of the project was $1 million. Moving to electronic processing improved efficiency by 60 percent, which has allowed Austin Mutual to write more business without adding staff, he adds. "An application that may have taken 14 days to process on paper now takes us a day," Franssen says.

Case Study Profile

Company

Austin Mutual Insurance Co. (Minneapolis; $72 million in assets).

Lines Of Business

Auto, homeowners and commercial risk insurance.

Vendor/Technology

Web-enabled policy administration system built by Keane (Boston).

Challenge

Transform manual, paper-based business submission process to enable electronic policy administration.