InsightsMay/June 2012

Transcription

1 Insurance New Normal InsightsMay/June 2012 The Path Beyond Business & Technology Innovation Innovation Insurer Suite Insurer Policy Insurer Claims Insurer Analytics Innovation Insurance Services Innovation Property Innovation Auto Innovation FNOL Future of Insurance Analysts & Awards

2 Let s talk about the future of insurance Today s New Normal demands a new path and new solutions. Engage in a dialog about the future of insurance and start your journey in one of many ways. J Use the QR codes on this page for more details on Innovation Group solutions. J Visit the Innovation Group website, to walk-through our interactive roadmap and view information about our solutions and customers. J View the new video on The Future of Insurance, featuring Gartner s Kimberly Harris-Ferrante and Innovation Group s Andy Roberts. Scan and Explore #futureofinsurance Need a QR Code Reader? Search for QR Code Reader in your app store or point your phone s browser to getscanlife.com to download a free app.

3 Change. Big Change. T he insurance industry is poised for significant changes, likely more transformational than we have seen since the 70 s when technology was the driver, fueling automation, operational efficiencies and product innovation through the technology revolution. Today, that revolution continues but is now driven by customers, changing the industry and market landscape and the use of technology in other industries where it is integral to daily life. Changes in the world economy and dramatic shifts in consumer demographics are creating a seismic shift in the insurance industry. Insurers must respond to new regulations, distribution channel preferences morphing to match customer behavior and demands, a shortage of qualified, skilled workers fueled by a perception of the industry as old and stodgy, and a failing technology infrastructure neglected during decades of underwriting losses that were hidden by soaring investment returns. While the core of insurance remains the same, risk management and protection of assets, the who, what, when, where and how are all changing creating new drivers shaping the future of the industry. These drivers shape five key areas of change within the industry including: Business Revolution: An industry lacking an underwriting profit for 25 years, with an accumulated deficit of nearly half a trillion and increasing catastrophic claims is unsustainable in the foreseeable low interest environment requiring a focus on fundamentals of underwriting profitability, pricing excellence and product innovation. New competitors will challenge the industry and influence new business models. Customer Revolution: The customer is in control, is surrounded by digital media, technology and innovation based on experience in other industries, transforming the industry. Self-organized customer groups will negotiate with insurers for the product and price. Data Revolution: Data analysis will transform data into relevant and actionable information that rapidly provides business insights using dashboards to manage the business operationally and strategically. Product Revolution: Product development and pricing will be individualized, include new services or features and evolve to customer s defining their own product. Distribution Revolution: Influenced by customer demands and expectations, we will see distribution disruption and fusion of new integrated, multi-channel, social-group interactions. Technology Revolution: Technology and process innovation will continue at a face pace and disrupt with new technologies like SOA, SaaS, Cloud, analytics and mobile internet computing to plan their future. Insurance companies today cannot afford to operate as they did ten, or even five, years ago. A strategic roadmap is the real key to surviving and thriving in the new normal and providing a path to the future. We are on the brink of a new era in insurance industry. An era of new business models as companies take advantage of new technologies, delivery options and markets to reinvent themselves and create new levels of competition. Those with a vision, roadmap and partner will have an edge to the competition and a clear course to a profitable future. How will you prepare for the future? Where are you starting from? What potential paths will you select? Insurers visions of the future must include more fluid, agile organizations with robust core software, analytics and BPO solutions, that quickly and effectively respond to change and embrace new opportunities to empower innovation and success. We are on the brink of a new era in the P&C insurance industry. An era of new business models as companies take advantage of new technologies, delivery options and markets to reinvent themselves, create new levels of competition and build for change. Innovation Group has the knowledge, experience and solutions to help you create your path of growth, innovation and real competitive advantage. We invite you to begin your journey with Innovation Group and travel down a new path to a future of growth, profitability, innovation and success! CONTENTS Welcome to Insurance Insights! May/June 2012 J Change. Big Change. p.3 J A New Normal A New Future p.4 J Best-of-Breed Suite A New Path to Success p.6 J Insurer Policy A New Path to Success p.7 J Innovation Roadmap A Pathway to the Future p.8 J A Claims Revolution p.10 J Data Mastery: Insurer Analytics Empowers Insurers p.11 J Innovation Insurance Services Helps You Prepare for Change p.12 J The Future of Insurance Start Your Journey with Innovation Group! p.15 Success Stories J American Modern Insurance Group (AMIG) p.7 J Hastings Mutual Insurance Company (Hastings Mutual) p.13 Contact Innovation Group Today! #futureofinsurance Join the Future of Insurance LinkedIn Group to learn what the insurance industry is saying. Insurance Insights 3

4 A New Normal A New Future The recent financial crisis caused a seismic shift which has profoundly impacted the P&C insurance industry. Low investment yields, exposure of long-term underwriting losses, increased competitive pressures, limited growth, and regulatory uncertainty are just a few of the deep, long-term implications insurers are beginning to understand. The result is a new normal for the insurance industry. Combined ratios are still lingering at higher than needed levels, and the industry is currently facing record capacity with decreased exposures. Underwriting profits are nonexistent, and claims payouts continue to accelerate. Market demographics have shifted significantly, driving change in consumer behavior and distribution channel preferences. Further, the industry is facing a serious shortage of skilled workers, which means business process outsourcing (BPO) is more warranted and needed now more than ever before. This shift to a new normal requires business strategy and business model transformation to create a new, agile foundation that adapts to change, enables continuous innovation and provides a platform for a new future. A New Business Model A convergence of long-term trends played out over decades is fundamentally re-shaping the business landscape. Declining return on assets (ROA) suggests the current way of doing business is broken. Fortunately, the new normal is delivering a new operational model which combines modern technology solutions, BPO services, and alternative delivery platforms, allowing insurers to focus on value-added core competencies. This new model tightly integrates highly-configurable, componentized SOA solutions which leverage business process management (BPM), integrated analytics and flexible delivery options on-premise, hosted, BPO, SaaS and Cloud, and integrate effortlessly with expert, specialized BPO services for insurance. Plus, it offers a new, strategic platform for market agility and growth while lowering total cost of ownership (TCO). By enabling breakthrough innovation and business transformation in this new way of doing business, insurers can combine emerging demands, operational efficiencies and dynamic insights around business processes to maximize profitability, market share and competitive differentiation. A New Business Solution One of the key features of the new normal s business model is a new breed of business solution. That said, it is important for insurers to look beyond modern SOA, Java-based solutions that only just outperform legacy systems, to solutions with truly modern business capabilities and delivery options. The best solutions are designed to rapidly adapt to cyclical business changes, build and deliver innovative products, services and real-time access, enable multi-distribution channels, provide operational claims excellence, deliver customer and underwriting performance insight, all while maintaining a low TCO and business agility. Based on a business architecture model, Innovation Insurer includes business experience, functionality and IP developed over 20 years, built from the ground up on a 100 percent Java, SOA architecture. The new Innovation Insurer inherently utilizes Today, it is imperative that insurers have the ability to adapt to change. According to the Insurance Information Institute: J There were no underwriting profits in a 25 year period, , and these losses are not sustainable. J Combined ratios must be lower in today s depressed investment environment to generate appropriate ROEs. 4 Insurance Insights #futureofinsurance

5 Innovation Group s extensive BPO operational experience providing a functionally-rich, modern UI with a robust data model and extensive configurability to meet business-specific requirements. Further, Innovation Insurer provides customer relationship management (CRM), real-time access, out-of-the-box portals for agents, customers and partners, mobility enablement, rapid product configuration and market delivery, rules, product templates and integration, extensive FNOL capabilities, integrated supply chain management, integrated business analytics, billing and financials, and reinsurance management. And, perhaps most importantly, Innovation Insurer is backed by a forward-thinking roadmap that anticipates future business changes. It is a scalable, proven, business solution with multiple delivery models, which makes Innovation Insurer a robust, innovative alternative to traditional systems. It is built and priced for all insurance companies, big and small alike. A New Business Partner Innovation Group s strategic direction and vision for the P&C insurance industry capitalizes on capabilities of the company s core software and BPO services. Today, Innovation Group is delivering this new solution and business model to drive more value to insurers, and provide the agility to change with shifting market conditions through best practices, and a platform for continuous innovation and transformation. Leveraging extensive BPO experience gained through support for over 800 policy and claims insurer customers globally, Innovation Group is a key part of insurer clients operations and Find out what the experts are saying about the Future of INSURANCE in a new video featuring Gartner s Kimberly Harris- Ferrante and Innovation Group s Andy Roberts. Now available on the Innovation Group website at brand promise. Deep involvement in our customers businesses gives Innovation Group a unique perspective on the innovation, energy and insight required for competitive advantage. Today, P&C insurers can choose a partner that offers a bespoke range of solutions to suit insurers needs from end-toend insurance and risk management.. A New Innovation Group Many describe Innovation Group as different and pushing change. While some vendors continued down the path of delivering traditional, yet separate, software solutions or BPO services, Innovation Group is delivering on a strategy that offers a new solution portfolio and a new business model for our customers and the industry. The Road Not Taken by Robert Frost states, Two roads diverged in a wood, and I I took the one less traveled by, and that has made all the difference. Without question, Innovation Group s enhanced Innovation Insurer and new business model combines the capabilities of the company s core software and BPO services. Companies that successfully deliver such broad solution sets drive more value to insurers, offer greater flexibility, and agility to change with shifting market conditions through best practices, a consortium of new ideas, market trends and capabilities, and a platform for change will continue at a rapid pace, offering different paths and making it a very promising time to be different. While others continued down the continuous innovation and transformation. - Craig Weber, CEO of Celent s insurance practice same path, Innovation Group took the one less traveled and applied new ideas and energy to a traditional business seeing big changes and plenty of competition, creating a new path for a successful future, one that will make all the difference. Insurance Insights 5

6 Innovation Insurer Provides Insurance Success and Exceptional Results. J Contributed to 50% organic growth J up to 40% productivity increase J Improved customer retention and satisfaction J Launch new brand, market segment and direct channel J Improved business intelligence and dashboard reporting Best-of-Breed Suite A New Path to Success Traditionally risk-averse, the insurance industry has long struggled with staying up-to-date in terms of technology, even when it comes to replacement of mission-critical systems that run core insurance processes. However, in light of the demands imposed by the new normal, core system modernization is no longer optional, it is mandatory for P&C insurers. A Sea Change A literal sea change must take place in order to mitigate the risk associated with a project as large in scope and importance as business transformation and core administration modernization project. Insurers today must turn to technology vendors who can provide more than a single component or module. A modular, best-of-breed suite offers insurers the best and easiest path to seamless integration, delivery of a tangible ROI with a lower total cost of ownership (TCO), and a platform for growth and real competitive advantage. The New Path Best-of-breed suites represent a big step forward on a new path for insurers. By providing the flexibility and choice to implement functionally-rich, stand-alone components, or a full suite, such solutions enable insurers to effectively manage the risk of core system replacement and provide a platform for future IT investment. Today, most solutions can be easily configured to meet each insurer s specific business requirements without changing source code, but differing in the depth and breadth of the business functionality from underwriting, policy, billing and claims to reinsurance. What makes best-of-breed suites with stand-alone components unique is that they have a common architecture and UI, single data model, outof-the-box integration, common rules and process engines and a single configuration toolset. The key words are common, single, depth and breadth. When selecting a best-of breed suite solution, insurers must consider these key words, because many vendors do not meet these criteria. Meeting Insurer Needs Innovation Group s Innovation Insurer is a modular best-ofbreed suite including components for policy, claims and analytics. Innovation Insurer is designed to meet the challenges facing modern P&C insurers by delivering significant business transformation capabilities, seamless integration, process optimization, a tangible ROI with a lower TCO, business agility, scalability, and a platform for growth and real competitive advantage. Consider the functionality and capabilities inherent to all Innovation Insurer components, including Insurer Policy, Insurer Claims and Insurer Analytics. DEPTH AND BREADTH OF BUSINESS CAPABILITIES: Innovation Insurer supports the end-to-end insurance value chain, including product management, rating, underwriting, billing, channel management, CRM, audit and financials, claims, supply chain management and reinsurance. INSURANCE-SPECIFIC ANALYTICS: Proactively manage your business with pre-defined P&C specific dashboards, reports, measures and KPIs. RULE OF ONE: One data model. One rules engine. One process engine. One configuration and administration toolset. INDUSTRIAL STRENGTH CONFIGURATION: Enable changes to business rules, UI, workflow, products, rates and adding functionality without changing source code. CUSTOMER-CENTRIC: Customer-centric data model, CRM, analytics and portals. DELIVERY OPTIONS: License, ASP, BPO, SaaS, Cloud, or any combination at any time. LOWER TCO: No additional license, maintenance or integration cost for CRM, analytics, supply chain management, rating, reinsurance, channel management and billing. ENTERPRISE DATA MANAGEMENT: A single data model ensures single view of the truth, data quality, consistency and visibility. COMPLIANCE AND RISK MANAGEMENT: Full audit-ability across the system for change and data, different brands or companies to support compliance and regulatory demands. BUSINESS AGILITY: Respond quicker to market changes, M&A, distributions options, new products, market growth opportunities and customer demands. STAFFING AND SKILLS OPTIMIZATION: Ease of the pressure of the lack of knowledgeable and skilled staff with the UI design, language and help capabilities, broadening the pool of potential employees. Innovation Insurer provides a path for innovation and transformation, a path to success. Begin your journey on a new path with Innovation Insurer. 6 Insurance Insights #futureofinsurance

7 Insurer Policy A New Path to Success One module in Innovation Group s award-winning best-of-breed suite, Innovation Insurer, Insurer Policy helps P&C insurers meet the challenges of a competitive global marketplace by delivering significant business transformation capabilities, business agility, scalability, underwriting excellence and process optimization with a tangible ROI and a lower total cost of ownership (TCO). Insurer Policy is a platform for growth, innovation and real competitive advantage that has been recognized with four XCelent Awards for functionality, technology and customer base by Celent, and as a component in Celent s Model Insurer Awards. Insurer Policy provides insurance success and exceptional results at a price that makes modern technology affordable for insurers across all tiers and segments. Product Innovation: Develop new products, enter new states and expand channels quickly with a dynamic, graphical product management toolset. Underwriting Excellence: Risk portfolio view of the customer and/or the household. Data analysis of underwriting trends. Open collaboration between underwriters and distribution channels. Customer-Centric: Grow and enhance customer relationships. Respond to customer demands and expectations with a 360 degree view of the customer. Customer analytics and portals. Channel Optimization: Respond to market demands. Channel options and portals. Channel optimization and harmonization. Insurance-Specific Analytics: Proactively manage your business with pre-defined P&C specific dashboards, reports, measures and KPIs. BUSINESS AGILITY: Respond quicker to market changes, M&A, distribution options, new products, market growth opportunities and customer demands with the robust, flexible configuration. Insurer Policy is a very technology driven and functionally robust system that has greatly benefited from Innovation s architectural approach of the rule of one: one data model, one rules engine, and one workflow, one configuration / administration tool set; the new UI and enhanced business development administration (BDA) capabilities that further set it apart in flexibility. - Ben Moreland, Senior Analyst, Celent CELENT Breadth of Functionality CELENT Customer Base 2011 CELENT 2011 Advanced Technology 2011 Breadth of Functionality Customer Base 2011 Advanced Technology American Modern Insurance Group (AMIG) Success Story Recognized as one of Ward s Top 50 P&C Insurance Companies in the U.S., American Modern Insurance Group (AMIG) implemented Innovation Group s Insurer Policy to support a business transformation initiative. AMIG s business strategy recognized the requirement for modern technology and business solutions that would enable greater depth of automation, and their strategic initiative, modernlink, included a web-based insurance transaction processing platform, replacement of aging legacy systems, and enhanced information management. Innovation Policy supports AMIG s commitment to specialty insurance products for its customers and enhanced web-based support for distribution partners and policyholders alike. Additional significant business value being achieved includes: J The enablement of specialty products and a service strategy that contributed to customer retention and organic premium growth of 50 percent in the past five years; J Improved underwriting capabilities and substantially lower costs that recur annually; J Hundreds of thousands saved annually by AMIG and the company s distribution partners due to improved productivity from new Internet selfservice options; J Improved billing collections that enhance cash flow; and J Enhanced customer and revenue retention from improved customer customer communications, flexible billing payment plans and high quality notices. The implementation of Innovation Policy provided enhanced product innovation, as well as operational efficiencies and competitive capabilities. Today, it is a cornerstone for their continuous innovation, competitive differentiation, and enhanced self-service options. The underlying business functionality includes product development, pricing/ rating, underwriting, billing and policy processing and distribution support. Because Innovation Policy is SOA based, it supported a phased implementation, allowed easier integration with our existing environment and provided other advanced capabilities for both in-house and web-based access. The solution enables enhanced product configuration and pricing segmentation to design and offer specialty products based on market conditions right rate for every risk, at the right time. - John Campbell, SVP and CIO, American Modern Insurance Group Insurance Insights 7

8 Innovation Roadmap A Pathway to the 8 Insurance Insights #futureofinsurance

9 Future IN THE WORLD OF INSURANCE today, it is easy to get mired in traditional methods, hampered by outdated technologies, and let down by services that were supposed to offer support. As insurers drive along the road toward the future, a strategic vision that includes more fluid, agile organizations with robust core software, analytics and BPO solutions, that quickly and effectively respond to change and embrace new opportunities to empower innovation and success are critical. There is a new normal dawning in the insurance industry. The right partner can help you prepare for change and the future. Act now, the future won t wait. #futureofinsurance Insurance Insights 9

10 A Claims Revolution Claims management is no longer just about cost, but increasingly about risk management, supply chain management, service excellence and customer retention. Claims solutions traditionally focus on claims administration, ignoring parts of the value chain in favor of cost efficiencies, leaving significant benefits uncaptured and risking competitiveness. These administration solutions lack the business functionality inherent to claims management, which enable innovation, transformation and This version of Insurer Claims represents an impressive upgrade from earlier versions in terms of functionality, usability sustainable operational results across the entire claim value chain. True claims management allows insurers to enhance customer service, improve and configurability. retention, and reduce Insurer Claims is an end-to-end claims management platform that also includes integrated analytics and management reporting. claims handling costs and timeframes. More importantly, it repositions claims as an integral part of efforts to achieve sustainable innovation and operational effectiveness. Innovation Group s Insurers managing the success with the array of delivery models entire claims value chain are better positioned to manage including license, BPO premium costs, increase and SaaS highlights the solution s flexibility and customer value, and drive profitable growth. configurability. A long-term vision and plan transitioning to -Donald Light, Senior claims management can help Analyst at Celent future-proof business and IT investments, and meet the business demands of today and tomorrow. Claims Management for a New Normal Leading insurers are beginning to invest in new claims management solutions to transform their claims business. These new solutions include broader capabilities beyond traditional FNOL, adjustment and settlement to supply chain management, fraud, litigation, self-service technologies and claims analytics to accelerate progress toward goals, deliver increased business value, market position, customer retention and return on equity (ROE). However, in order to achieve optimal results and business value, new claims solutions must include these broader capabilities as well as integration with expert BPO claims services, such as supply chain management for repair networks, adjusters and contractors, interactively across the full claim value chain. Bottom line robust claims management solutions enable insurers of all sizes to compete with top tier companies. The industry continues to see a strong demand for modern SOA, Java-based claims management solutions that do more than just out-perform legacy systems. Such solutions are designed to rapidly adapt to cyclical business changes, deliver new services and real-time access, manage outcome excellence and insight, all while maintaining a low TCO and greater claims operational flexibility. Insurer ClaIms Delivers Modern ClaIms Management Critical to choosing a new claims management solution is selecting one that is functionally-rich, yet provides extensive configurability to meet business-specific requirements. It should include BPM capabilities, a modern UI, a robust data model, support industry standards, and a SOA architecture with pre-built, reusable services. Equally important, is extensive real-time access, mobility enablement, litigation, advanced scoring, supply chain management, catastrophe management, out-of-the-box rules and integration, business analytics, and a forward-thinking roadmap that anticipates future business changes. Insurer Claims is a component of the Innovation Insurer Suite, an integrated platform with best-ofbreed components (policy, claims, analytics) using a single data model, rules, process and configuration toolset. Insurer Claims offers insurers core claims capabilities in all claims solutions, but goes much further. SUPPLY CHAIN MANAGEMENT: Insurers can integrate with their supply chain or BPO services, such as repair networks, glass repairers, adjusters and contractors. FRAUD MANAGEMENT: A fraud engine with pre-built rules that evaluate 50 common fraud indicators, and case management functionality to support fraud investigations from start to closure. CATASTROPHE MANAGEMENT: Ability to define catastrophes, identify claims, and modify workflow and assignments. GEO-CODING & MANAGEMENT: Outof-the-box integration with Google Maps and QAS to enable geo-coding and mapping functionality throughout the claims process. INSURANCE-SPECIFIC ANALYTICS: Proactively analyze, manage and grow your business with data-intense decisioning, out-of-the-box dashboards and key measures. COMPLIANCE & RISK MANAGEMENT: Provides full audit-ability across the system for changes and data, different brands or companies to support Sarbanes Oxley and other regulation using Insurer Configurator, the configuration toolset. LOWER TCO: No additional license, maintenance or integration cost for Analytics, Supply Chain Management, CRM and Billing. STAFFING & SKILLS OPTIMIZATION: Broaden the pool of potential employees by easing the pressure and lack of knowledgeable and skilled staff with the UI design, language and help capabilities. Insurer Claims is a scalable, proven business solution and an innovative alternative to traditional systems, built and priced for insurers of all sizes. Insurer Claims helps insurers compete in the new normal. 10 Insurance Insights #futureofinsurance

11 Data Mastery: Insurer Analytics Empowers Insurers Data is the lifeblood of the insurance industry. It feeds, sustains and protects insurance organizations of all types and sizes. It is used to analyze performance and trends, to plan and monitor high-level goals, and to make critical decisions in the areas of underwriting, claims, marketing, customer service, product development, regulatory compliance and finance. Data is a strategic asset for insurers, but one in which they lack the fundamental street smarts that equate to business insight and intelligence. Solutions for a Data- Driven Industry Modern insurers must find solutions that turn colossal quantities of data into actionable insights. The sheer speed of change today requires insurers to move beyond automation efficiencies to focus on business strategies. Management of all insurance operations, from policy through claims, is a complex and demanding business. During these challenging times, the power of data management and analytics can deliver immediate and significant value to the bottom line of an organization, but more importantly help transform the business model and practices to raise competitiveness. So the question for your organization is... Do you Innovation Group has raised the bar for insurance analytics vendors. Innovation Group has designed Insurer Analytics with the business user in mind, incorporating feedback from their insurance customers and analysts. This new version of Insurer Analytics leverages the Microsoft BI platform, while broadening and deepening the insurance specific capabilities to empower the business. -Ben Moreland, Senior Analyst for Celent know what you don t know? If you don t you may be bleeding data and information. Access to accurate, timely, relevant Business Intelligence (BI) is key to dealing with these challenges. Identifying emerging issues before they grow into bigger problems, directing resources to the greatest point of pain or opportunity and highlighting performance against benchmark targets all combine to drive down costs and improve performance. A flexible and comprehensive BI system is needed to deliver this level of sophistication into the value chain. The Secret Sauce Data analytics is the secret sauce needed to change the competitive position for an insurance company. Insurer Analytics provides data-driven insights for broad use across all major areas within an insurer. At the heart of Insurer Analytics is the philosophy of guided analysis at speed. Our belief is that any analysis should transform data into relevant and actionable information that can be rapidly delivered where it counts. Insurer Analytics is a best-of-breed insurance analytics solution that goes much further by: J Empowering the business with an easy to use, accurate and intuitive solution that enables business users and translates to high adoption; J Providing business agility with quick, fast, accurate decisions based on quality, accurate information; J Enabling performance management across the value chain to manage the business from products, customers, and distribution channels to partners across the entire insurance value chain to ensure both top and bottom line exceptional results; J Incorporating a library of predefined P&C insurance analysis solutions aligned to the rich data model; and J Functioning as a businessfocused solution for all users through use of a single data model specific for P&C insurance that is extendable, providing a single data management platform to ensure a single version of the truth. EXceptional Results: J Implemented in 3 months J ROI achieved in 1 month Our strategic partnership with Innovation Group, and our selection of Insurer Analytics will underpin and strengthen our business operations and deliver value to our clients. In evaluating a range of solutions in the market or considering building our own solution, we found Insurer Analytics significantly exceeded the capabilities of other options, offering a value proposition that will be instrumental in providing exceptional service and proactive medical claims management to our clients. -Linda Diekmann, partner at Premier Prizm Insurer Analytics... Built for Insurance Insurer Analytics is designed and built for insurance professionals by insurance professionals. It provides a robust, detailed insurance data model reflecting the entire insurance value chain and capabilities that eliminate the additional time and cost to set-up generic analytics solutions. Unique company-specific data requirements are architecturally and easily extendable in the model. The primary design is for the business user, but it also supports the power user who has more advanced analytical needs, such as underwriting and claims users. While IT maintains control over the data, the business has total control of the dashboards, charts, maps, KPIs and reports for analysis. Insurance Insights 11

12 Innovation Group knows claims and handles more than six million auto and property claims and incidents per year. Innovation Insurance Services Helps You Prepare for Change Last year rewrote insurance history with record losses and CAT events, including a 2011 tornado and thunderstorm season that when counted as a single event was the 4th costliest in U.S. insurance history and the 5th costliest event in global insurance history as noted by the Insurance Information Institute. Increased competition. Customer service excellence. Claims transformation. Claims indemnity costs. New products and services. Business agility. These market forces are creating disruption and opportunity. How can you respond? With a strategic partner who extends and compliments your business with competitive, sustainable business solutions. Innovation Group. In an intensely competitive P&C insurance market, insurers are focused on operational effectiveness and innovation to drive profitable growth. Our clients results speak for themselves. Consider that Innovation Group: J Processed over one million claims in six months for a major cat event; J Managed the largest storm season in company history with double the number of expected claims; J Provided real-time analysis used to effectively deploy adjusters and trigger engagement of third-party adjusters; J Delivered daily tracking of losses and reserve management, plus reporting to forecast reinsurance triggers; J Closed claims 30 percent faster while ensuring responsiveness and customer service during a crisis situation; and J Reduced loss adjustment expenses 12 Insurance Insights #futureofinsurance

13 Intake Triage Assign Investigate Evaluate Negotiate Settle Subrogation FNOL Intake Insurer Claims & Analytics Innovation Insurance Services MRN Managed Report Network Out of Network Appraisal Out of Network Report IA Management Desk Revision Heavy & Specialty Equip Emergency Temporary Service PRN Network Innovation Group Supply Chain (LAE) and indemnity spend by eight to ten percent and claims leakage and cost by ten percent. To achieve results like these, insurers need a partner with a competitive, bestof-breed claims management solution designed to optimize business and customer results. To achieve optimal value, insurers must address the entire claim value chain, including areas such as FNOL, appraisals, rental management, repair referrals and payments, subrogation, salvage, analytics and potential fraud. Insurers who do not consider these broader claims capabilities, Police Reports Audit Subrogation ISO Reports Rental Management Total Loss Contractor Report Adverse Subrogation Salvage Lien Release Management leave significant benefits unrealized. The combination of core claims process with our BPO expert services can provide the greatest impact on total claim outcome, claim optimization, combined ratios, customer retention and reallocation of resources to growth initiatives. Innovation First Notice First notice of loss (FNOL) is the moment of truth for insurers when it comes to customer service. At this point, the service can be enhanced, the customer can be retained, and the claim cost can be managed. Consolidating and automating Novarica s 2011 Market Navigator U.S. BPO/Virtualized Insurance Company Operations: Property and Casualty Report This report highlights that Innovation Group supports all P&C lines of business, and has live U.S. clients in personal auto, property/homeowners, workers compensation, and admitted commercial lines with 170 U.S. clients live on claims and customer service and more than 50 live for document creation and management. This includes approximately 20 clients with more than $1 billion in annual premium. Innovation Group U.S. BPO operations provide a broad set of BPO services, including their first notice of loss call center and the managed repair networks for auto and property, with one of the largest customer bases in the U.S. market. -Matthew Josefowicz, Managing Director at Novarica Hastings Mutual Insurance Company (Hastings Mutual) Success Story Building on a 125 year-old legacy of success, a U.S. regional insurer implemented an auto growth strategy resulting in almost 37 percent growth in personal auto direct written premium and almost 28 percent growth in policies in force with no increase in staff, increased recovery by 20 percent or $1.2m and a 67 percent savings increase per claim with annual savings of nearly $2.4m using Innovation Group s Auto business process services. The strategic impact was a foundational shift of claims as a cost center to a market differentiator operation enabling them to maintain LAE at 8 1 / 2 points, positing them as best in class. Our strategic partnerships must replicate the quality services our policyholders have come to expect from Hastings Mutual. Hastings Mutual dedicates a considerable amount of time ensuring our vendors provide the type of customer support we ve built our reputation upon. Innovation Group has met and exceeded our expectations by delivering service and choice to our customers while providing ease of business for our agency group. Chris Ballantyne, Vice President of Claims for Hastings Mutual Insurance Insights 13

14 cost of repair is consistent with the actual damage to the vehicle. the initial claim touch point is the earliest and richest opportunity to improve and accelerate the claim-handling process. Innovation First Notice provides leading call center and FNOL services, and strives to maximize the business results of each loss report using our claims expertise and capabilities, as well as key partners, to positively affect the entire claims management process. By leveraging Innovation Group s P&C business expertise and scale of Innovation First Notice, insurers can leverage new opportunities, best practices, ideas and products into their existing claims model to enhance their customers service experience, including use of ACORD or insurer specific loss forms. Innovation Group can handle all or some of your FNOL needs, including after-hours, overflow or catastrophic events. Innovation Auto P&C insurers know that Auto Physical Damage (APD) claim units can impact their customer satisfaction and claim costs. Innovation Auto services can meet and exceed the capabilities of most insurer s operations, providing a competitive option for insurers of all sizes. Innovation Auto enables insurers to capitalize on these opportunities, by providing specialized expert business process (BPO) services that integrate with our industry leading core claims software, Insurer Claims. The backbone of our expert services is our managed repair network of over 2500 shops, which is much more than just a list of repair shops. Our network of repair shops meet strict guidelines relating to facilities, equipment and training, as well as performance goals for customer service, cycle time, quality estimating and repairs. Innovation s repair network offers nationwide coverage with a choice of shops, consistency and a lifetime warranty on the work performed. Also included 24 X 7 toll free customer support, electronic file processing, repair assignment and oversight. Our managed network ensures your customers are taking their vehicles to the most trusted, reliable body shops while benefiting from the buying power of a large network provider. Our ICAR Gold Certified Collision Department, with qualified technicians averaging 20 years of P&C experience, reviews all images and estimates that come through our electronic loss adjusting system to ensure that the Innovation Property With property losses, P&C insurers face two major challenges customer claims experience and controlling paid loss. Innovation Property enables insurers to capitalize on these challenges, by providing specialized expert business process (BPO) services that integrate with our industry leading core claims software, Insurer Claims, a unique and compelling solution that no other provider can offer. Innovation Property is a leader in managing the repaid of residential and commercial property insurance claims, and maintains the industry s first best-ofbreed contractor network. Key attributes of Innovation Property include: National network of over 900+ managed contractor services, including roofing only general contractors to optimize availability and customer satisfaction Deep P&C expertise in managing residential and commercial property losses Unique approach to driving favorable financial outcomes, customer satisfaction and best in class cycle times Rigorous due diligence standards used to credential each contractor including proper licensing, service delivery guarantee, detailed financial reviews, criminal and sex offender checks, annual check for adequate insurance coverage and credit check Flexibility to add and remove contractors to build a tailored network and estimating guidelines Three (3) year warranty on workmanship and 5 year roofing warranty on replacement From the time when a FNOL is reported, your policyholder is provided a choice of contractors to help them fix their loss quickly and in a quality manner. Without standardized communication of data and information between the contractor, insurance company and insured, the scope and approach for mitigating and settling the loss can be agreed upon quickly, significantly lowering the paid loss on the claim. 14 Insurance Insights #futureofinsurance

15 The Future of Insurance Start Your Journey with Innovation Group! Insurance is about managing risk and sharing risk exposure across a wide number of people or organizations. Today s new normal exposed strategic and operational risk within insurance companies highlighting legacy paradigms of business models, customer expectations, distribution channels, core insurance solutions and delivery models. Adding to the risk is the convergence of trends including mobility, social media, explosive growth of data, analytics, product and service innovation, and SaaS and Cloud delivery options. The result... intense competition, growth and profitability pressures, and challenges to longterm viability. We are seeing before our eyes, the changing face of the insurance industry. The industry is at the threshold of significant change, fueled by these opportunities and challenges, applying pressure to evolve the legacy paradigm. Insurers must embrace innovation, disruption, and new technologies to manage and leverage these risk factors to create a new paradigm of competitive advantage. While the future of insurance may be hard to predict, it is imperative that a roadmap for the future embrace innovation, transformation and optimization by using new partners who are disrupting long-held industry traditions. So how can insurers get to this new future? Do they follow others or set a unique course for innovation? What strategic partners help fuel innovation and offer non-traditional solution paradigms? How will insurers avoid the lemming effect? History teaches us that the it vendor or the leading incumbent gathers many followers, who go along unquestioningly with popular opinion, but with potentially competitive consequences... just like lemmings lore when they gather large numbers on the move and can mindlessly go over the cliff or into a trap, offering no easy way out. Business, product, service, process and technology innovation are coming to market at a mind-boggling pace. So, how do insurers set a course to the future and become truly next gen businesses? Given limited resources, expertise, knowledge and time, insurers must strategically place their bets and investment with partners who offer more than traditional vendors. These partners have strategies and plans to disrupt incumbents in the next 3 years; a vision and roadmap of the future using emerging technologies; offer an array of delivery models that can change; and new ideas and experience outside insurance that fuel disruption and innovation. Because of this, these partners avoid the risk of the lemming effect by avoiding the risk of following others and concentrating your future with others, becoming one of the pack rather than an innovator. Insurers visions of the future must include more fluid, agile organizations with robust core software, analytics and BPO solutions, that quickly and effectively respond to change and embrace new opportunities to empower innovation and success. We are on the brink of a new era in the P&C insurance industry. An era of new business models as companies take advantage of new technologies, delivery options and markets to reinvent themselves, create new levels of competition and build for change. Innovation Group is that new, nontraditional vendor with a vision and roadmap that offers innovative, forward thinking solutions. We have uniquely brought together the internal and external end to end value chain for P&C insurance through our industry leading software, Innovation Insurer, and our BPO services, Innovation Insurance Services, providing a best of breed solution portfolio that enables business agility, process optimization, customer centricity, while empowering the business to grow, scale and change to capture market opportunities quickly and cost effectively. Stand out from the crowd. Be a leader and innovator. Begin today and set your course on a journey to the future with Innovation Group. Insurance Insights 15

16 Innovation Solutions are a hit! The insurance analyst community is buzzing about Innovation Insurer and Innovation Insurance Services. Innovation Group has recently been awarded for overall functionality, modern technology, and ROI delivered for customers! Here are a few of the most recent awards Innovation Group has received Silver Ranking 5-Customer Viewpoint INOVATION GROUP: INSURER CLAIMS (2012) INNOVATION GROUP: INNOVATION AUTO (SERVICE) (2012) CELENT Customer Base 2011 CELENT Breadth of Functionality 2011 CELENT Advanced Technology 2011 #futureofinsurance Begin your journey with Innovation Group solutions! 76 Batterson Park Road Farmington, CT United States t: f: e : info@us.innovation-group.com