When considering systems applications modernization/replacement, carriers tend to concentrate on the underwriting functionality of any given solution, which may “bleed” over to the marketing/distribution and general billing function (collecting premium). However, carriers should give other company functional areas equal consideration—e.g., claims, loss control (if applicable), customer service or equivalent functions, ERM evaluation, and IT as well as back-office functions such as accounting, statistical/bureau, and other statutory requirements.
It is important to review the enterprise as an integrated entity. The ability to service the needs of all separate functional areas within the organization is of critical importance when selecting a modern enterprise applications solution. When reviewing proposed application solutions, carriers should ask:
- Does the solution take into account not just billing and collections per the organization’s general practices, but also fee application abilities, collection activities if the premium is not paid but is earned and not collected, customer service considerations, billing suspension capabilities, billing changes, write-off capabilities, types of billing supported, and other billing changes required by the organization’s processes?
- Does the proposed solution have the ability not only to schedule loss control activity but also to integrate the results of loss control activity?
- On the claims side, does the proposed solution include third-party integration such as property evaluation tools and, if applicable, bodily injury assessment tools? Salvage? Subrogation? Reinsurance? Fraud detection? Legal tracking?
- Where are the oft-forgotten statistical/bureau and statutory requirements going to be supported?
- Where are accounting functions going to be supported (i.e., annual statement support, reinsurance reporting)?
- Where do ERM considerations fit into the proposed solution?
- What type of management data/information access might be required, and how is that access provided?
- What does the IT support look like in the proposed solution? What’s the technology? System software/hardware? What is the toolset(s)? Maintenance/version upgrade efforts?
With the advent of multiple third-party data access, consideration should be given to those integrations with any anticipated solution—not just on the underwriting side, but also within the claims, marketing, distribution, and loss control areas.
Prior to launching a project of this size, carriers should conduct a requirements analysis, identify which solutions are a good fit for their organization, and ensure that all stakeholders in the organization are prepared. For more information on how to prepare for a system modernization or replacement initiative, read Novarica’s Core Systems Project Readiness report.
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