How to integrate imaging with your - and your carriers’ - automation systems.
"For paper now is all the rage, and nothing else will suit the age."
Howard Paul, 'The Age of Paper' (c. 1860)
Although agents and brokers have been hearing about paperless offices and digital document management for years, many have been hesitant to change the way they store and save data. But as personal computers, office networks, and agency management information systems have evolved, the concept of the paperless agency is slowly becoming a reality. The trend is also driven by increased demand for ways to turn paper into computer files, as agency staff gain confidence in the accuracy and reliability of computer systems and become more comfortable in managing customer information.
Concerns about disaster recovery and record retention are two key factors affecting agency decisions to implement scanning. The loss of paper files and data can create unacceptable business interruptions. Reducing an agencys paper and storage space increases its productivity and reduces operating expenses.
INCREASE EFFICIENCY
Burnham Insurance Group (Battle Creek, MI) has been working with scanning technology since 2000. According to Chief Financial Officer Richard Phillips, the organization wanted to leverage technology to improve operating efficiency, to access and retrieve information, and to save storage space. 'In an effort to get better control of the paper flow in our office, we started transactional filing (T-filing) five years ago in Personal Lines,' says Phillips. 'The implementation was successful and yielded positive results, so we began T-filing in Commercial Lines two years ago and commenced imaging both Commercial Lines and Personal Lines T-files shortly thereafter.'
Employees resisted the move to T-filing initially, but became more comfortable with the process as they worked with it. Burnham plans to expand scanning in its financial institutions business unit, which monitors insurance coverage on auto loans for its clients. 'We currently receive over three million documents annually that will be scanned on the front end and distributed electronically, and expect to achieve significant efficiencies by going paperless,' Phillips says.
ENHANCE CUSTOMER SERVICE
Agents and brokers often find that the most useful application of scanning technology is in customer service. Since the electronic files are available throughout the office, any employee can handle customer service calls at any time. Producers engaged in selling need not break away to deal with customer service calls. Also, paper files are never lost on someones desk.
Ken Jarosz, director of finance for The Harry A. Koch Co. (Omaha, NE) began scanning paper documents in accounting four years ago. The agency scans payroll, licensing, and benefits files. When a mortgage company requests information on an employees earnings for the past three years, the agency can pull the information quickly instead of requesting files from storage, waiting for them to arrive, and conducting manual searches.
'Access to files is a key issue for our firm,' Jarosz says. 'With different office locations and departments sharing client information, its important that we have as much data as possible available online.' This also enables staff members to work from their homes or from other locations. When a bond producer in the companys Lincoln office requested copies of client files, it was clear that the bond department would be a key area to benefit from this technology.
A year ago, the Koch agency successfully implemented scanning in Personal Lines. 'The key to our implementation successes has been to get the users involved,' Jarosz says. Since CSRs were apprehensive in the beginning, the agency created a dummy file and scanned information to it. They asked the CSRs for their input on file structure and set-up, and made changes based on their comments, creating a feeling of ownership among the CSRs.
The agency recently hired a project manager whose key responsibility is to implement scanning throughout the agency. 'Our goal is to have scanning made available for every department within the next 12 months,' Jarosz adds.
TIPS FOR IMPLEMENTATION
Phillips and Jarosz agree that implementing scanning successfully requires a commitment from agency management who must devote the necessary resources to the project. They should follow these key steps:
- Create guidelines for what should be scanned and how files should be set up. An agency must monitor the types of documents it creates and receives. In Commercial Lines, these include both new and renewal declarations pages, issued endorsements, correspondence from insureds and company personnel, worksheets, premium audits, and cancellation notices. In Personal Lines, they might include inspection forms, photos, driver training certificates, jewelry appraisals, and some nonstandard applications.
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With the advent of e-mail and downloads, many agencies dont receive nearly as much paper as they once did. For example, many insurers have stopped sending agencies paper declarations pages for downloaded transactions. Some carriers still send the paper deck sheets, however, and an agency might receive other paper documents that it also gets electronically. The agency needs to monitor its incoming documents to decide which ones really need to be scanned.
- Determine indexing structure. Indexing is the method by which imaging software creates meaningful search options, so you can quickly find images after theyve been scanned. This is critical to the success of any imaging system. With stand-alone imaging systems such as those used by The Harry A. Koch Co. and Burnham Insurance Group, images arent saved as attachments to client files in the management system software. However, generally available indexing options allow you to retrieve imaged documents with a variety of search criteria, including name, policy number, and date of activity.
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Optical character recognition (OCR) is a process by which the imaging software indexes text and converts it to an electronic file. Since each word on a scanned page is indexed individually, every word becomes a potential key word for a search.
- Determine how scanning will affect workflow. In most cases, imaging will be an additional step in an agencys standard procedure for handling transactions, and the agency will need to incorporate this step into the procedure seamlessly. Two questions you need to answer are: a) Who determines what information to scan? b) Who scans the documents?
Scanning might affect workflow when handling business thats out of the ordinary. Many agents and brokers are beginning to use electronic document management systems to scan E&S and Nonstandard Auto applications, and special certificates of insurance. They store scanned documents in a central image database, where agency staff can access and complete them. Imaging technology can also help streamline the submission process. Loss runs, census data, and applications can be scanned and e-mailed or faxed to carriers.
Here are a few additional tips for successfully implementing imaging technology in your agency:
- Make sure your implementation team has in-depth knowledge of both the business side and technology side of the imaging issue.
- Select a vendor with expertise in scanning and who understands your business needs.
- Create written departmental procedures and workflow.
- Start small, especially if you have no imaging experience.
- Be prepared for resistance and pay attention to your people.
"Paperless files are now the rage, and electronic workflow management suits the age."