The Future of Gateways

Insurance companies have invested heavily in “robust” portals that stress ease of use, transaction tools and integration with broker management systems – making their original offerings look old-fashioned by today’s standards. Many are poised for the next generation of portals, with newer features like consumer-broker bridging, mobile applications and collaboration tools.

But the lingering question still exists: will any of this satisfy brokers?

First-Generation Portals

Like any technology, insurance company portals for brokers have evolved significantly over the past decade. The earliest iterations of these online sites typically began in the early 2000s and took off mid-decade, and they reflected much of the Web business ethos of the time – e-document provision, static one-way communication and laborious user interfaces.

Company representatives widely acknowledge these initial portal incarnations had some positive traits, but also represented a strong downside for brokers in terms of workflow, training and technology. “The earliest portals did provide access to simple transactions, forms and information, but at a cost,” says Kathy Curran, manager of business solutions for The Economical Insurance Group (TEIG). “Brokers were forced to learn the nuances of each portal, to sign in manually and to navigate through proprietary screens and fields. In other words, (they had) to adopt one-directional workflows that differed amongst carriers and forced brokers to always leave their systems and come to the carrier.”

These first-generation portals added value, but they did not take into account broker workflows and their complexity increased training costs, adds Jack Ott, senior vice president and chief information officer at Intact Insurance. “The main connecting technology at the time was ‘screen scraping,’ which was inefficient and provided an unfriendly user experience.” (In the original version of screen scraping, visual text data was collected through a computer display terminal’s screen – as opposed to reading the data from the computer’s memory, for example, or through an auxiliary port.)

The challenges of signing on with passwords to multiple company portals, understanding the unique aspects of each site and then being unable to complete transactions in a once-and-done format have frustrated brokers for years – points many insurers readily concede. “Insurance companies have been slow on the uptake as it relates to portal technology, especially compared to the broader financial services industry,” notes Debra Ambrose, senior vice president of national sales, marketing and broker operations for Aviva Canada.

Speed forward to today.

Several sources contend that more functional and flexible broker portals have grown to become a crucial competitive tool for property and casualty insurance companies.

“I have seen a major shift in portal technology,” says Katherine Evans, vice president and chief financial officer of York Fire & Casualty Insurance Company. “When portals first started, they were very insurance company-focused and based on what kind of information insurers needed to gather. Brokers can’t deal with a portal in that way – they are often on the phone and need answers right away to serve their customers.”

Carrier portals now have richer features, such as pre-populated fields for data entry, more intuitive interfaces and automated help and response services. They also offer greater functionality across the full spectrum of the policy lifecycle – in transactions for quote, new business, inquiry, policy change, renewals and claims.

“Where we are now is that carriers have moved business automation and business rules to the portal, including integration of data and reports from third-party providers,” says Martina Conlon, a principal in the insurance practice of consulting firm Novarica, which published a report, Best Practices in P&C Agent Portals, in April 2010. “More transactions are being pushed through the portal for personal and small commercial lines. In some cases, we have seen insurers process as much as 60%-80% of this business through portals in no-touch transactions.”

Conlon describes portals in the property and casualty industry as “relatively mature technology . . . As many carriers already know, a (broker) portal is a must-have and a more robust portal will help increase both growth and retention.”

Today’s Portal Technology

Today’s property and casualty company portals have to address the reality that some consumers want to conduct transactions fully online, while others prefer a combination of electronic convenience and in-person consultation with a broker, according to Glen Piller, president of iter8. “There is a level of automation and then an option for manual contact,” he says. “Modern portal solutions have to support both.”

Curran says TEIG’s portal, Broker Extranet, offers solutions such as real-time PDF billing, claim and policy inquiry and quoting and binding, among others. It also gives brokers the ability to access and export policy documents and notifications. “As an industry, the most significant evolution in company portals overall has been the increase in availability of true real-time transactions, the provision of issuing authority for brokers, investment in reducing duplicate entry, more types of transactions made available and the use of third-party integrators or direct integration agreements to extract data from the broker or commercial management system (BMS/CMS) and pre-populate it into the company’s portal,” Curran notes.

Ott says one of Intact’s goals is to make portals more transparent and less intrusive to the broker. “Today Intact is working toward a smaller portal footprint, which is more mindful of broker workflows and certainly less demanding in terms of training,” he says. “We can now turn to Web services to link applications and services in a way that allows intuitive and easy navigation.”

As one example of a “lightweight portal intervention,” Ott points to his company’s recent SaversPlus system, which will be rolled out nationally this year. Intact introduced “transaction wizards” that intelligently present only the data fields brokers will need for a certain transaction. “Our vision is that the portal becomes more adaptive to the business context, rather than a big application you get lost in.”

Ambrose says her company re-launched its Aviva Partners broker portal in 2010. The portal now includes new transaction tools, content and a “marketing hub that allows brokers to brand their names and logos to various marketing programs. We have made a concerted effort over the last two years to focus on the needs of our brokers and to emphasize ease of doing business.”

At York Fire, Evans says the company’s “Gateway” insurance portal has emphasized accessibility for brokers through their BMS. “We have seen that connectivity to portals has been a real competitive advantage for some BMS vendors,” she says. “We want to give brokers access to policy and customer information immediately and we think brokers should be able to do that right from their BMS.”

An insurer’s goal should be to deliver the right tools in the entire portal, tools that enable outstanding customer service and inspire confidence and loyalty
in customers, says Mark Witt, vice president of business development for Duck Creek Technologies. “Enabling brokers to quickly respond to customer inquiries across the entire spectrum of business requires access to the right tools and improved efficiency in round-trip communication.”

Brokers’ Critique of Portals

For all of this activity and investment in portal development, several high-profile broker groups are still critical of these online company offerings. Many brokers say their issue is not with the evolution of portals, but with the very concept of the portal itself. “Portals were created by insurance companies to deal with
the problem of their own back-end legacy systems,” says Wendy Watson, a vice president with the Precept Group and chair of Ontario Real Time Brokers in Transition (ORBiT). “It was the most economical way of remodeling a front-end system. It did not work then with how brokers do business and it still does not work now.”

A clear example of broker frustration is the nagging issue of multiple sign-ons and passwords for company portals, according to Watson. “One of our working groups at ORBiT is focused on security and sign-on; this is our biggest problem,” she says. “Brokers with multiple markets are still having to sign-on and use different passwords. This is just not efficient or workable, not to mention the security issues.”

The Centre for Study of Insurance Operations (CSIO) has a proof-of-concept industry standard for single sign-on and password security, but Watson says insurers cannot necessarily agree on how to use it.
Portal sign-on and security is an ongoing sore spot for many brokers, some insurers acknowledge. “Security continues to be a concern,” Ott says. “CSIO is showing good leadership and I think we will move closer to an industry standard in 2011, but clearly password management is an irritant for brokers and a necessity for carriers. We need to find the right balance.”

Brenda Rose, vice president at Firstbrook Cassie & Anderson and a technology champion with the Insurance Brokers Association of Canada (IBAC), says the position of the national broker association is clear: “Brokers should not be obligated to use a company standalone portal, full stop. I think now more companies are realizing that (portals) are, at best, temporary solutions. Transactions in the industry require an information exchange between the BMS and insurer systems directly.”

IBAC is currently working on a data exchange project with six participating insurance companies – Aviva Canada, The Dominion of Canada General Insurance Company, The Guarantee Company of North America, Intact Insurance, RSA Canada and TEIG – to create a common platform for straight-through processing of transactions from broker to insurer back-end. She says the ongoing SEMCI project should have initial results in “a couple of months.”

Getting the Message

Insurance carriers are showing signs of recognizing these messages from brokers, at least in theory – particularly in the areas of legacy systems and a smaller role for the portal. For example, one promising development, according to Watson, is the fact that several companies are either starting to – or are in the process of – replacing their legacy policy administration systems.

Ambrose notes Aviva Canada “has committed to a massive business transformation” of replacing its legacy system over the next five years. “This is our Number 1 priority in terms of technology investment,” she says.

Curran says TEIG is in the process of replacing its legacy policy administration systems with a Web-based system “to facilitate XML-based transactions, increase access and use of Web services and hence, the ability to complete real-time transactions in a variety of ways.”

However, insurers caution this process will take time. “There is opportunity to evolve the function of portals to the point where they are in the background and not the front end, or even utilized at all,” Curran says. “However, to do so requires significant investment and evolution in the carrier’s own back-end systems and technology. (This) is not an overnight accomplishment.”

The notion that insurance company portals will become extinct in the near future is wishful thinking, according to several carrier and technology representatives. “The point is that the carrier should stay in the background, “Ott says. “And if a small portal footprint can achieve this, I think most brokers will be pleased. I know some brokers are calling for complete standardization to the BMS. It sounds good in theory, but in practice it pulls us all toward the lowest common denominator; the broker management systems are not ready for it. Companies need the opportunity to differentiate their products and functionalities up to a point. We think a reduced portal footprint is the right approach for the mid-term.”

Evans argues that a single platform for all transactions would water down the functionality of individual company portals. “Portals are a competitive advantage for insurance companies,” she says. “Some companies have invested a lot in their portals, others have not. Some companies are at different stages of functionality. To try to get them all on the same platform is pretty much impossible.”

If some type of singular portal experience truly added value for all insurers, then it would already have happened, Witt contends. “The truth is, it doesn’t benefit the insurers to participate in such a centralized offering. And because it doesn’t benefit the insurers, then it won’t ultimately benefit the agents or brokers.”

Exploring Alternatives

The question thus becomes: What is the alternative?

“As an industry, there is no single solution today to support one workflow using a single technology platform that will satisfy every carrier and broker,” Curran says. “Brokers collectively are still coming to an understanding of what that workflow looks like.”

In the meantime, insurance companies are looking at emerging opportunities in their broker portals. These might represent the “next generation” of portal functionality, with a far greater emphasis placed on the consumer.

“For the most part, policyholders have tolerated the technology limitations of insurance,” Piller says. “But that will change. As more and more people move online, you will see many of them expect to conduct all transactions, from beginning to end, in that environment.”

Curran says changes to consumer behavior and expectations mean consumer-facing portals facilitating data exchange between the consumer and the broker represent a significant business opportunity. “This concept is not a future vision,” she says. “Direct writers have this today. The broker distribution channel needs it to compete.”

TEIG has developed a broker-branded consumer quoting, purchasing and client self-serve Web site called Insurance on Demand, according to Curran. “It gives brokers the technology to create an online presence with their own branding and facilitates the exchange of data between the consumer and the broker.”

Aviva Canada is also developing a consumer portal to be launched in Spring 2011, Ambrose notes. “We have a lot of people visiting the Aviva Canada Web site, and we are looking at how we can offer consumers a quote and then redirect them to a broker, whether by geographic location or type of business,” she says. “Also, there may be opportunities for consumers to pursue self-service options for things like payment and inquiry. Again, our focus is on ease of use for our brokers, and for our customers.”

Conlon says Novarica has noticed that large carriers are placing a higher priority on developing consumer-facing or consumer-broker bridging solutions in their portals. However, some carriers distributing through independent brokers “often hesitate to implement online quoting because they fear they will alienate their brokers,” she says. “They have not figured out a proper channel preservation strategy.”

Novarica recommends a solution “that will allow shared components across your consumer and broker portals. Maximize re-use of screens, product definitions and integration with Web services and core systems. Use common functional components such as the rating engine, document creation and document management to simplify your environment.”

Witt notes that many carriers are pursuing these goals, with some success. “We see insurance companies
responding by embracing the power of a well-designed portal to serve
their customers,” he says. “Even customers with a broker can still go online and look up their policy and, perhaps most importantly, qu
ickly re-print policy documents. This seamless experience with the company is at the heart of a good portal strategy and we’re seeing successful companies implementing this strategy.”

Future Opportunities

Another emerging trend in modern portal technology is the use of mobile applications (apps), which have been slow to take hold in property and casualty insurance in Canada. “A big issue is whether brokers really adopt iPads and smart phones and what functionality they are going to bring to insurance transactions,” Conlon notes. “Most portals have the ability to download or print a certificate of insurance. This could be done through a mobile app and emailed to a client, for example.”

Piller sees mobile applications as a “simplified extension of portals. Insurance companies may offer these as a differentiator, and it is very trendy to have a mobile app. It may provide some ‘stickiness’ for certain consumers, but there will be limited functionality.”

The explosion in mobile technology will enable portals to extend their reach and capabilities, Witt says. “Building technologies that make it possible for brokers to transact higher volumes of business with a carrier easily and successfully will lead to greater value for both broker and insurer. Portals should naturally be at the heart of this extensibility.”

And while much of the focus of portal technology has been on personal lines and small business, opportunities exist in mid to large commercial lines. “There is a big difference between personal and commercial lines, and what portals can do,” Piller notes. “It is a far more complex project in commercial insurance.” He adds that only about 20% of commercial lines insurance operations have fully functioning portals.

Online collaboration tools between brokers and underwriters such as collaborative document authoring, instant messaging and chat features represent a potential boost to commercial efficiency, according to Conlon and Novarica. “Online broker/underwriter collaboration and document-exchange functionality will likely be areas of enhancement over the next few years in large commercial broker portals,” Conlon says.

Even though some brokers sharply criticize their limitations, property and casualty broker portals will continue to fulfill key functions in the short term, according to many insurance company representatives. There is also a recognition that portals have to evolve further. Insurance companies will be vying for ways to better match portals with broker workflow and make them more transparent in the mid term.

“The most promising developments are not necessarily technological in nature, but instead driven by new standards and a clear vision,” Ott explains. “Broker associations and industry groups such as ORBiT have given us a much more precise definition of what the ideal solution should look like. As we formulate our strategies at Intact, we are now able to measure them against well-defined principles, resulting in better alignment in the future.”

Major investments for insurers associated with replacing back-end legacy systems and working with broker groups on a common data platform will take time. Few are expecting a major breakthrough in this area in the next year or two.

A more immediate pressure facing broker-distribution insurance companies is aggressive competition from direct writers – including price wars in regional markets, heavy advertising and a ubiquitous Web presence. This competition, sources say, will spur companies to give brokers the tools to compete in the online world. The next generation of portal offerings, characterized by broker-consumer contact and insurance company systems seamlessly built into the background, is already underway. It will likely be a key source of carrier differentiation in the months ahead.

“Brokers and carriers need to re-think the purpose of portals, not only what they were originally created for but more importantly, the audience they serve,” concludes Curran. “Company portals were designed to support the exchange of data between the broker and the carrier. This need absolutely remains and is being satisfied, to some degree, by the evolution of the portals in recent years. What other audience is there, then? The all-important consumer.”

How quickly can portals adapt to meet the needs of this audience?