Direct to the Broker Channel

Wendy Watson, vice president of operations for the insurance and financial services firm The Precept Group Inc., is using her professional background as a direct writer to help make life easier for the broker channel.Watson is one of several key players in the 2010 incorporation of Ontario Real Time Brokers in Transition (ORBiT), a group first launched in 2009 to address broker workflow issues.

The group’s mandate includes striving for real time transactions between brokers and carriers. ORBiT believes all suggestions for real time workflows must promote single-entry, multiple-company interface (SEMCI) with insurance companies. But ORBiT’s focus is not on technology. Rather, its purpose is to identify and design ‘best practices’ for broker-carrier workflows, helping the broker channel to remain profitable.

Watson has some insight into the challenges facing the broker channel having worked for the first 15 years of her life as a direct writer. When she was 18 years old, she joined CIAG Insurance in New Liskeard, Ontario, north of North Bay. [CIAG eventually became The Co-Operators.]

During her time at The Co-Operators, Watson did it all. She worked in service, sales, underwriting, administration, wrote specifications and tested computer systems. She managed a service area in west end Toronto. She also went into systems development on the user side.

After a brief hiatus from the insurance industry, she switched over from the direct side to the broker side in 1991. She joined Daly Farnworth McGregor [DFM] in Guelph, Ontario, one of three companies that merged to become The Precept Group Inc. in 1998.

As Watson describes it, moving from the direct side to the broker side was like moving into a new country. “It was a shock when I came to this [broker] side,” she says. “Even the language was different. And at The Co-Operators, our front-line people had a pen. When I got to the broker’s side, our folks had to call underwriters for permission to write the most basic risk. And the rate manual wasn’t really clear. Everything was manual. Everything was manual.”

Luckily for Watson, Jim McGregor, managing partner at DFM, had a similar interest in driving process and efficient workflows. At that time, McGregor was onside with the introduction of a quoting system then known as NDS (Nova Data System). Watson worked with carriers at the time to get them to honour the prices in NDS, so that brokers could put information into the system once and get rates for all of their carriers.

You might say broker workflows became a passion for Watson. She worked on a number of industry projects like Synchron and the CSIO Portal, which were promoted in their day as SEMCI-style technology solutions. Neither project really achieved lift-off, however, and Watson believes it was because each worked towards a single technology solution for all broker-carrier interactions. “There can’t be a one solution for the many different ways that brokers conduct their businesses,” she says. “And I think that’s why both failed.”

ORBiT advocates SEMCI objectives, but it takes the emphasis off of employing a particular technology. Instead, the organization concentrates on working with industry stakeholders to improve broker workflows. “What we’re doing in ORBiT is developing a best practices workflow and then brokers will choose their own system, their own BMS [broker management system], that works for them,” Watson says. “The brokers can build their [BMS] system the way they want, the carriers can build their systems and integrate [with the brokers] the way they want. But we at the front line will have our best practice workflow.”

Certainly the difference between the workflows of direct writers and brokers is apparent to Watson, who has worked with both.

“In terms of upload/download, for our agents at Co-Operators, they would put something into the system and that would be it – it was truly once-and-done,” says Watson. “And when you get to the broker’s side, you’re writing stuff on paper, you’re putting it into a courier to get to a carrier, and then you’re waiting eight weeks for a document to get back. This is still the case.

“We have carriers that are causing brokers to do duplicate entry into [the carrier’s online] portal to eliminate that wait period. Brokers like us who are refusing to do duplicate entry are waiting six to eight weeks to get a change back on a policy. From 1991 to today, they [the inefficient workflows] still exist.”

ORBiT’s purpose is to foster an industry-wide dialogue to help solve these problems. It emerged after Watson and others organized the Real Time Broker Expo in Cambridge, Ontario in September 2008. Two hundred and eighty-five people watched an Applied Systems broker demonstrate how transactions were done between brokers and carriers in the United States.

Watson knew that for the same type of thing to work in Canada, it had to be broader than just an Applied Systems solution. But enough people were interested in the process, and ORBiT was born. The big thing, Watson says, is that brokers hadn’t really ever been asked before what process best works for them. “As brokers, we’ve never been asked what we want our BMS to do,” she says. “We’ve never been asked by our carriers about the best way to do something. We’ve always been told.”

One of ORBiT’s objectives, therefore, is to broaden the discussion about broker workflows to include brokers, broker associations, carriers, BMS vendors and other interested stakeholders.

“Our mandate is to facilitate open communication between all stakeholders and to provide education to all stakeholders to advance once-and-done transactions, so we can improve efficiencies by way of best practices workflows using industry standards,” Watson says. “That sounds big and broad, but it’s pretty simple. Everybody is at the same table, coming up with a best practice workflow, using industry standards.”

In a way, it sounds very much like the CSIO’s recent emphasis on industry standards – although on the CSIO side, the talk is about technology standards, not workflows. But since the two are often interrelated, CSIO sits in on ORBiT’s board.

“Standards are key,” says Watson. “We cannot do real time – and we can’t even do upload and download – without standards. The problem is, not all carriers and broker management systems are using current standards. If the standards aren’t used, we don’t have clean data coming down in a download to our BMS, we can’t do anything moving forward until we clean up that data. That’s one of our focuses: keep driving the standards. If we don’t, we won’t be able to move forward.”

ORBiT’s work is broad. Its 10 working groups touch on almost every aspect of a broker’s daily work environment and deal with the following issues/topic areas:• password management; • real time payments; • real time inquiry for billing, policy and claims, with a return document to be attached to the broker’s BMS; • clean download; • renewal PDF downloads; • media/education; • commercial lines; • quoting; • new business; and • policy change.

Ultimately, Watson sees her – and ORBiT’s – role as driving process, not systems design. “I was on the user side, not on the back-end side,” she says of her experience in the insurance industry. “Whether we were developing a property system for The Co-Operators or leading the claims systems side, my job was always to ask: ‘What do we as users need?’ That fits in with what I do on ORBiT.”