FINEOS gives the London Market Food for Thought

Graham Newman, European Product Marketing Manager, FINEOS

FINEOS and its client, Liberty Syndicates, took centre stage at the latest Lloyd’s Thought Leadership Event hosted in the market’s Old Library on Tuesday 4 February.  The monthly meeting is hosted by Lloyd’s as part of its efforts to encourage debate over the use of technology and FINEOS’ Tim Crossley was invited to speak on the topic of “Delivering an enhanced claims service through the focused use of technology”.

The event was held just a day after Lloyd’s launched its Volume Claims Service which is being operated by Crawford & Company, using FINEOS’ claims management software.

Tim began by outlining the need for the London Market to embrace the use of technology as the market’s process reform initiatives continued to evolve and make ever greater demands on efficiency and effectiveness.

He highlighted the work FINEOS has done with Liberty Syndicates, Kiln and Allied World and described how the unique nature of the way the London Market operated required FINEOS and Liberty to extend and enhance FINEOS’ highly successful claims platform product to suit the needs of the subscription market.  This process of continual functional build has been extended significantly during FINEOS’ collaboration with Kiln, incorporating additional functionality into our standard product that wasn’t needed at the time by Liberty e.g. multi-syndicate and enhanced binder support.

Tim explained that this year both Liberty and Kiln will be upgrading in what will be a significant step in the process, adding “We have to thank Liberty for the work they have done with us and the result has been a product which we have been able to use to the benefit of the wider market”.

FINEOS has created a strong tradition of maintaining its clients on up-to-date versions of its Claims product.  We carried out 4 upgrades in 2013 and 6 more are on schedule to be completed by June 2014.  88% of FINEOS’ customers are on the latest release or the one before.  Some of our newer clients have built in to their business case for acquiring FINEOS Claims the budget for installing upgrades annually because the financial benefits of using the latest FINEOS functionality are compelling.

The Claims Management Director of one of our North American customers told me just before Christmas that they had calculated various gains in efficiency from upgrading to the latest release.  After running parallel comparisons between the existing and new systems she said: “We calculate a saving of 7.6 full time staff by upgrading to the new version of FINEOS with improved usability”.  Over the years they have found that each upgrade of the FINEOS system not only brought tangible, measurable benefits but also had a straightforward financial advantage.

This is a discipline that FINEOS is bringing to the London Market; we are not aware that many IT vendors in this market have such a policy but for us it is standard practice to keep our clients up to date and benefitting from the continuous investment in claims capability.  This year, for example, we are trialling FINEOS Business Analyser, a QlikView based addition to our Reporting suite that complements CRS, and we anticipate making a number of market led changes not least ECF write back.

Liberty Syndicates’ Head of Claims Scott Kellers then addressed the meeting.  Positioning his talk firmly at the centre of the event’s theme Scott started with a slide stating:

“Liberty Specialty Markets view the focused use of technology as being the foundation for the delivery of a claims service that provides a key differentiator for the business”.

Scott outlined the challenges faced by the claims department when it came to the implementation of new technology.  He said the systems had to be implemented as the market was moving to an increased use of technology across the business and the benefit of enabling claims technicians to simply concentrate on the technical claims which need attention could not be under estimated.

However he cautioned that the move to such systems required a great deal of time, planning and commitment from management and that claims managers had to understand that constant communication was needed across all areas of their business to ensure successful delivery of the system which was envisaged at the outset. The fact that other areas of the business would be approaching the system development from slightly different angles also needed to be taken into account.  These are all important aspects of internal realignment that is needed whenever new technology arrives bringing new ways of doing business.

Scott described how, through the use of good technology, Liberty were achieving:

  • Effective triage
  • Evidence of process and procedure
  • Fast Track claim processing
  • Third party expert management controls
  • Litigation management
  • Enhanced workflow and business information

All of which allowed the Technical Claims Handler and management to make informed decisions.

Scott concluded by saying that the implementation of FINEOS had delivered all their aims: Liberty were now fully compliant with Lloyd’s Minimum Standards, were fast tracking 25% of their claims volume and providing an improved claims service with faster file turn-around times.  The management information the system provided daily enabled them to proactively manage resources within the department and that the embedded audit capability greatly enhanced the quality and ease of audit.

Scott talked about what he wanted to see the future bring to the technology he used, and said that now he expected a continuing response to market developments.  With the work that FINEOS has done with its London Market clients we now have a product that is market ready and can handle syndicate business out of the box and we will continue to keep it current with, and to lead, the market needs.

Finally, as this was a thought leadership session, Tim had some challenges he asked the audience to ponder.

FINEOS has a ‘green army’ of 140 permanent staff in R&D focused on Claims System Development. This is our core competence, what we do day in day out, globally.  We have been doing this for twenty years, across 150 discrete new and upgrade claims projects.  So the first question is: “Is claims system development an insurer’s core competence? Should it be?”  Yes, I know that’s two questions but I’m sure you’ll forgive me on that score as they are closely related.  The thing is, FINEOS devotes its entire corporate effort to advancing claims technology, should insurers plan to do this themselves as well as running their insurance businesses?

Secondly, the time to implement FINEOS Claims in Lloyd’s has come down from 18 months to 4 months, largely as a result of Liberty and Kiln allowing us to build out our product.  Allied World just went live having started in September! They did this by sticking to the ‘out of the box’ solution to get live as soon as possible, but still had time to integrate with AgencyPort, Outlook and of course ECF and SCM. It also means time and effort to upgrade is so much less. So the second question is: “Could your business take this approach? What is the downside?”.

Thirdly, FINEOS Claims is now live in the Cloud!  As a highly scalable, variable expense, and reliable computing model, Cloud has the potential to enable insurers to be more flexible and responsive to market opportunities.  It seems to fit well as an enabler of Vision2025?   Everyone seems to agree that Cloud is inevitable.  Final question: “Does this market want to lead or lag in this?”.

Answers on a postcard please to me at:

Thank you

Graham Newman