Real-time SEMCI for Independent Agents Becomes Reality

By Jeff Yates, ACT Executive Director

February 2003 — A major step forward for our distribution system occurred on October 20, 2002 when
Applied Systems, eight insurance companies, and IVANS enabled real-time interfaces for 7,500 independent agencies through their Applied Systems. These agencies can begin to experience real efficiencies in their operations today by activating these interfaces using the automated �wizard� that Applied has developed to speed implementation. At the same time, AMS Services has begun to implement some real-time interfaces with companies and plans more in the future. We expect to see other vendors and companies make positive announcements over the next year as well, creating a continuing series of opportunities for agencies to achieve incremental improvements in their workflows.

Applied and its partners in this initiative deserve a great deal of credit for creating the critical mass necessary to get the real-time SEMCI ball rolling.

Applied�s user group, ASCnet, has earned special �kudos� because it has been a steadfast champion for SEMCI, and it drives Applied�s development priorities. It is now incumbent upon all independent agents to use these innovative interfaces as they are developed, to support the companies that have made the necessary investments, and to press additional companies and vendors to implement these improved interfaces and to extend the functions which are covered.

To initiate the �Light �Em Up Campaign�, Applied pre-configured all of its agencies with IVANS Transformation Station for real-time interface with the companies they represent. The eight initial companies agreed to install their particular real-time functionality with all of the Applied agencies representing them. Applied then created the �wizard� to permit an agency to turn on the functionality on an automated basis so that approximately 15,000 agent-company interfaces could be activated in relatively short order.

The eight companies chose the following functions for their initial real-time interfaces available to all Applied agents. The Hartford and Ohio Casualty activated Billing Inquiry for personal and commercial lines. Progressive activated Billing Inquiry for personal lines. ACUITY and Kemper Auto and Home chose Auto/Home/Package Quote for personal lines; and Encompass chose an Auto/Home Quote Bridge. The St. Paul activated 1st Notice of Loss Reporting for commercial lines which permits the agent to get back the client�s claim number instantly.

Travelers chose commercial lines Loss Run Inquiry which allows the agent to get immediate loss runs. The company also has implemented quoting and issue for small commercial lines, but this application is available when requested by agents and requires some agent training. ASCnet and Applied singled Travelers out for special recognition at ASCnet�s recent conference because of its early commitment and investments to pave the way for real-time SEMCI. Travelers plans to continue its leadership role with the roll-out of several additional real-time applications over the next 9 months.

Look for these initial companies to broaden the functions covered by their real-time interfaces in the future and for additional companies to go active.

The AMS Users Group

is also aggressively pushing for real-time interfaces. They have had an enthusiastic response from their members to their online SEMCI Reform Petition. AMS Services is committed to building real-time interfaces with companies. For example, it is working on small commercial lines quoting with Travelers through IVANS Transformation Station and has developed a link for Progressive that navigates from the policyholder file
on the agency management system to that policyholder on the company�s web site.

The major payback from real-time SEMCI interfaces early on will come from e-services that newly permit agents to provide their customers with immediate service. These are services such as billing inquiry, claims inquiry, online policy viewing, loss runs, and first notice of loss reporting. These services have the potential to achieve dramatic new efficiencies for both agencies and companies. Let�s take billing inquiries as an example and assume that the typical agency makes 3 billing inquiries a day (a very conservative number). When you multiply that number by the 40,000 independent agencies in our distribution system, you get 120,000 inquiries a day.

Brian Bartosh, a Michigan independent agent using Applied, found that his staff has been able to cut the length of time to make a billing inquiry from an average of 12 minutes (when making the inquiry by phone to the company or by accessing the company web site) to 15 seconds through his agency system to the company and back in real-time. Extrapolating that number across the entire distribution system amounts to 1.4 million minutes a day or approximately 6 million hours a year– time that can now be dedicated by agency employees to value added customer service, cross selling, or new sales. And this number represents the potential savings on just the agency side from this one new real-time application!

The companies save big, too. Progressive has reported that the company saves $3.00 every time an agent makes a billing inquiry through the agency management system using IVANS Transformation Station (15 cents per inquiry) rather than by calling the company.

New technologies and real-time SEMCI interface offer us an unprecedented opportunity to streamline our distribution system and to position ourselves competitively for the longer term. Independent agents need to keep pushing for more effective interfaces, from more companies, covering more functions. We need to be unrelenting advocates for this cause on a sustained basis both individually– at company advisory council meetings, in
convention exhibit halls, and in our one on one discussions with company CEOs and senior executives�and collectively through ACT, the agents associations, and the user groups. If we make this cause a priority, and become savvy users of technology and improved workflow, I am confident we will finally make substantial progress with SEMCI. We also need to commend those companies and vendors which take the steps and commit to the investments that make our future more efficient and profitable and provide these partners with our support and our business.

Jeff Yates is the executive director of the Agents Council for Technology (ACT) which is affiliated with the Independent Insurance Agents & Brokers of America. Yates can be reached at [email protected]. See ACT web site at for copies of the ACT Interface Statement and Agent Talking Points. This article represents the views of the author and should not be construed as an official statement of ACT.