Safety Insurance Expands Product Mix and Market With Agile Technology

Safety Insurance Company had a full agenda in 2008. The Boston-based carrier generated great results with the rollout of online services to grow its homeowners business — while in the midst of expanding into New Hampshire, addressing a landmark rating regulation that affected Massachusetts auto policies, and revamping its billing, claims and management information systems.

“We were able to grow our homeowners book by better than 20 percent, and we were able to handle a lot of blocking and tackling issues happening at the same time without increasing our internal overhead,” said Jim Berry, vice president of Insurance Operations. “We couldn’t have done it without the support of CSC.”

Harnessing the Web for New Business

The relationship dates back to 1997 when Safety, looking for a new system to prepare for Y2K, chose CSC’s Series II policy administration system, a fully integrated processing platform for large property and casualty insurers. CSC hosts Safety’s system, and CSC staff handles all aspects of Safety’s policy processing support.

To support its Internet strategy, Safety also became an early adopter of CSC’s Agency Link, a suite of Web browser-based insurance services interfaced with Series II. Agency Link gives Safety’s 900 agents a fast quote and online approval, plus access to detailed policy information.

“Agency Link is very intuitive, so there’s not a lot of heavy lifting in agency setup and training,” Berry said. “When we set up a new agency, we load a digital certificate onto their machines so they don’t have to keep up with passwords, and we walk them through our portal. Training can be done in half a day.”

Independent agents embraced the system, and with 99.99 percent of new applications coming in over the Web, Safety’s personal and commercial auto business surged. The company doubled in size— from $275 million in premium to nearly $600 million in 2008 — and became Massachusetts’s second-largest writer of personal auto policies.

Transforming Billing, Claims and Management Information

Besides providing agents an easy-to-use front end, Safety implemented CSC’s Straight-Through Processing enhancement to Series II, which processes transactions in real time. It streamlined the process for commercial auto new business and endorsements from three days to one. It also gave agents access to real-time information and the option to eliminate the printing of policy declaration documents and endorsements under Safety’s eCustomer program.

Building on its auto business’s success, Safety talked with CSC about using Agency Link to focus on selling its homeowners business over the Web. Safety was using another vendor’s policy administration system to manage its homeowners business, and agents said it was not user friendly for entering new business. The system needed a major overhaul to support the Web services in Agency Link.

“We knew over the long term that we would be continually coming up with fixes and asking the old system to do things it was not designed to do,” Berry said.

Safety decided to move its homeowners business to the same platform as auto. CSC worked with Safety to develop a 15-month plan to convert data into Series II, and in the midst of this project, Safety completed its first expansion outside Massachusetts into New Hampshire. The company also responded to the Massachusetts Insurance Commissioner’s decision allowing insurers to set their own rates, which brought new competition to the personal auto market.

On top of that, Safety decided to modernize key functions of the system with CSC’s Exceed Billing, Claims, Management Information System and Financial Information System.

“We knew we needed to create a fully integrated system, and we knew that Exceed Billing and Claims had the flexibility we needed,” Berry said. “When you look at the companies using Exceed Billing, for example, there’s an incredibly diverse range of billing plans, so we felt it was likely it would more than cover our needs in Massachusetts.”

Streamlining Claims Processes

Safety’s claims personnel moved from mainframe-based green screens to modern Web-based screens that use dynamic entitlements to display information based on the user’s authority. Rather than giving 40 or more people access to everything, claims data is available based on the needs of managers, adjusters, underwriters and other groups of users.

“The feedback was very positive and it is a much easier system to use,” said Steve Varga, senior manager of Safety’s Management Information Systems. “The managers really like the dynamic entitlements, which make it easy to limit access to comply with Sarbanes-Oxley. Of course, we also have a new reporting tool now that makes it a lot easier to generate a group of reports or build custom reports.”

The Exceed Claims work-in-progress feature supports the assignment of claims tasks, allowing Safety’s managers to view the status of all assigned tasks to help monitor workloads. The Web-based deployment of the system, which allows claims personnel to work anywhere, is allowing the company to improve its catastrophe planning strategy.

“Exceed Claims also gives us the ability to make claims information available to our agents in their offices. And using the same dynamic entitlements that we use in-house, we have the ability to allow our policyholders to access claims information securely over our Web site,” Varga said.

CSC’s support helped Safety keep all initiatives on track, allowing it to reallocate resources to product development, testing and pricing, and business development. “Outsourcing with CSC gives us the ability to ramp up our support, or ramp it down, depending on our business needs,” Berry said.

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