Bye, Bye Portals

The property and casualty insurance industry isn’t exactly known for its groundbreaking changes, but recent technological advances have altered that stereotypical perception. Given recent advancements towards a once-and-done model, in which brokers work almost entirely within their respective broker management systems (BMS), change is rapidly affecting the way business is conducted. Industry groups such as the Organization of Real Time Brokers Implementing Technology (ORBiT) and the Insurance Brokers Association of Canada (IBAC) are providing a common voice for brokers that seek a streamlined interaction with the insurers with which they work. IBAC specifically is pushing for once-and-done technology adoption for endorsement uploads.

Portals and Their Limitations

Traditional transactional portals only exaggerated the problem for brokers seeking to improve productivity in order to compete properly with low-cost direct writers. By having to use several Web portals to transact business with individual insurers, as opposed to sending faxes or using EDI submission functionality, brokers were handicapped with excessive re-keying and training issues. That’s not to mention errors and omission vulnerabilities. Although using portals is sexier than using green-screen-based legacy systems, portals still represent a step backward in productivity. The argument has been made that by using portals as the initial input source, brokers would not suffer re-keying issues. That would be a fair assessment if the EDI downloads were reliable mechanisms for sending data back into the BMS. But as any broker will tell you, EDI download is not reliable. Add to that the cost of training employees on how to use each portal, as well as the lack of reuse when quoting to multiple, and any benefit quickly vanishes.

Many insurers have invested heavily over the years in providing portals to their distribution channels. As a sop to the broker, most insurers enabled some form of upload. This upload functionality varies across insurers with respect to the supported lines of business and transaction types. Most common is the inquiry transaction. Here, brokers are able to review information related to policy, claims, billing, etc., by way of a Web page or a pdf file.

Several insurers support new business submission to their portal through either an automated scripted approach or Web services. The only real difference is that the scripted approach eliminates many of the training requirements for using a portal, since the navigation and workflow are driven through automation.

Streamlined Approach to Uploads

A handful of insurers have also used automated scripting to upload endorsements directly into their portals. Endorsements represent the most expensive form of inefficiency for a broker, since the transaction itself is an expense to the brokerage. Thus, any cost savings generated by processing endorsements goes directly to the bottom line.

The number of transactions brokers are uploading to insurers by way of portal integration has increased exponentially over the last couple of years. Several insurers are receiving almost all of their business through the use of these upload functionalities. As pressure on the broker channel mounts as a result of the threat imposed by the direct model, brokers are becoming increasingly focused on productivity.

The upward trend in the use of upload functionalities will accelerate with the replacement of traditional portals with a streamlined approach that takes into account the desire and need of brokers to work from within their BMS as exclusively as possible. This streamlined approach replaces the need for countless enterable pages with one page. This single page supports the capture of only company-specific questions or a CSIO application approach in which all the information can be captured in one page. This versatility provides the brokers with ability to work either completely on one page, without extensive portal navigation, or from within their BMS with a very limited number of additional questions. This streamlined workflow saves valuable minutes over the traditional approach. Brokerages using insurers that have implemented this streamlined approach are biggest champions of driving further adoption of this method by other insurers. It has become very clear brokers prefer this approach, and the broker associations will continue to encourage the insurers to do away with traditional portals.

The Ideal World

For brokers, the ideal scenario would be to eliminate the need to capture any additional data for any insurer. No technological challenge prevents this, and perhaps one day this will be the case. But several issues present themselves. For example, who has the system of record? Also, carriers will insist on a way for insurers to differentiate themselves through the underwriting process; how might the system accommodate this?

Brokers are gravitating toward the endorsement upload using scripting technology, so it stands to reason that a streamlined portal endorsement upload will also be successful. So how is it possible to do an endorsement upload in Canada when this has not been achieved anywhere else?

The key is the use of standards in a way that facilitates a synchronization process at the same time the transactions are being uploaded. It’s also important to compare full images of the policies instead of relying on the deltas within the BMS, since the data may be out of sync or the delta is difficult to identify by the software.

Many insurers are quickly migrating to this model. And since it can run as a standalone option from the existing insurer Web site, it becomes a complete replacement for the traditional transactional portals. Brokers will increase their efficiency, and insurers will benefit from increased business because the broker associations will be calling on insurers to use this approach on behalf of their membership.

Another, larger area of growth related to this technology is within the consumer-to-broker/insurer model. By using a streamlined workflow, consumers are more likely to complete the sale. On the other hand, with a traditional Web portal, each required field or navigational page becomes a potential hurdle preventing the policy from getting bound and sold.