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Q&A: Republic Indemnity CIO Innovates on a Tight Budget

Rao Tadepalli, CIO of Republic Indemnity, has found ways to innovate in a resource-constrained environment, finding efficiencies through digitizing documentation and improving efficiencies through core system transformation and process reengineering.

Rao Tadepalli, Republic Indemnity
Rao Tadepalli, Republic Indemnity
What is it like to be an insurance CIO in economically challenging times?

Tadepalli: As a CIO, I want to be creative and innovative, but in recent years there has been quite a bit of pressure on the workers' compensation industry, which has made budgets tight. As a result, one of the most important areas for exercising creativity has been in cost control. We've been on the lookout for any areas where we can operate more efficiently and reduce expenses.

Where have you found such opportunities?

Tadepalli: We've made a lot of progress eliminating paper. We're not 100% paperless, but I think it's fair to say we've achieved what you might call a "paper-lite" environment. We've applied digital imaging and created electronic documents across the enterprise. There are no more underwriting and claims files sitting in file cabinets, occupying space and requiring people to pull and circulate paper files. All of our documents are completely electronic and Web-based, accessible at any time to authorized users. Various business processes that need the same file don't need to wait in line for the file. These processes can be performed simultaneously. That has helped us to cut costs and improve the speed and accuracy of operations.

Has paper-lite improved Republic's interaction with external parties, such as customers and distributors?

Tadepalli: Definitely. For example, we send out field auditors to perform premium audits. These field auditors would go out and collect payroll and other financial information. Traditionally, we used to send out a big package in mail or via FedEx or UPS. Prior to their visit, there used to be a great deal of manual work. Now everything is done by the system.

The system automatically prepares and sends out an electronic package via email. Then the field auditor can schedule a visit to the employer to audit payroll, taxes, etc. The auditor can then enter data in the system, and the system will prepare bills to be sent immediately. We've been able to increase efficiency substantially and do more with fewer people. The system does similar electronic packages for our loss-control consultants.

What about process efficiencies? Any progress there?

Tadepalli: Yes. For example, we've seen significant efficiency gains in claims workflow. In the past, we operated on green screens, and as I suggested earlier, with paper files and manual processes. That environment was very difficult to scale up and expand into different states. With the implementation of our Guidewire ClaimCenter system [in 2009], we improved both workflow and ease of use. Electronic document capabilities are seamlessly built into the workflow, which further improves efficiency. We've also seen a 50% improvement in the cost of maintaining the system, just looking at IT head count.

Have you embarked on efforts to reduce information technology expenses?

Tadepalli: Yes. For example, we used to have our own disaster recovery facility in San Diego. I proposed that we move the whole facility to Cincinnati, where we can take advantage of GAIC's data center for disaster recovery and save on rental, real estate, power consumption and other costs. We did that in early 2010, and in early 2011 we also moved our email maintenance and management.

We've also been able to piggyback on enterprise licensing to enjoy volume discounts. In that regard, we've been moving toward virtualization with VMware. We did that when we implemented ClaimCenter, which was itself a collaboration with GAIC.

In addition, we're in the process of moving our IT application change management system for [Sarbanes-Oxley] compliance to a cloud-based solution from ServiceNow. This reduces our costs and frees up resources that can be focused on business-driven priorities.

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

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