Members of the ASI executive team include (from left) Henry Stansbury, chairman and CEO; Nancy Christman, vice president of sales nd marketing; and Jim Schafle, president and COO.
Ever hear of an "ah-ha"? It's like a revelation--that moment in time when an idea is born. For Henry Stansbury, chairman and CEO of Agency Services, Inc. (ASI), the ah-ha which serves as the basis for this story came about eight years ago. At the time, he was investigating the opportunities for ASI--a premium finance company he founded in 1975--to integrate its products with the products of rating software vendors and insurance companies. Stansbury found the necessary technology wasn't yet available, resulting in integration efforts that were time-consuming for both parties. The end result wasn't as smooth as Stansbury would have liked. "It was hard to sell the benefits to an organization if they had to put six to nine months of effort into the development of the product."
But a couple of years ago, object based technology came of age and Stansbury's ah-ha became a reality. Integrations that used to involve months of development and programming are accomplished in a couple of weeks. ASI is now approaching wholesalers, agency management system vendors and rating software vendors in an effort to create opportunities for these firms to market the ASI Quote Kit to their customers. The result is what Stansbury describes as a win/win/win. We'll learn more about that and how ASI is helping its customers help their customers after we find out a bit more about the Quote Kit.
ASI's Quote Kit is the manifestation of Stansbury's vision. Markel Insurance Company, a specialty niche carrier, is in the early stages of using the Quote Kit. Facilities and Services Corporation, a rating software vendor, also is using the Quote Kit to add value to its relationships with carriers and agents.
Jim Schafle, president and chief operating officer for ASI, explains. "We've created a tool that no longer needs to be integrated into another system's code or programs. It sits alongside and accepts the data from that other system, but it acts as if it's working within that system."
Henry Stansbury continues. "It reaches in, extracts whatever information it needs from that system, processes it and then places it back into the system it accessed. The Quote Kit doesn't intrude on the system being accessed, and the carrier or rating vendor doesn't need to tie up valuable resources to implement the Quote Kit.
"The sales advantages haven't changed over time, but the technology differences are significant," he adds. "There's a growing awareness within the insurance industry and all the financial services industry of the power of object oriented technology. Object oriented technology is making it easier to bring the industry closer together."
Enhanced cash flow
As for the advantages, he points out that when a premium is financed, the insurance companies get their money more quickly thanks to ACH (electronic banking). The funds are deposited within five days rather than coursing their way through normal accounts payable channels. "There's a cash flow advantage, which means there's an investment income advantage, and a control advantage. What's more, we're going to reduce their billing expense, their postage expense and their customer service expense."
Nancy Christman is vice president of sales and marketing for ASI. Based just outside Richmond, Virginia, Christman's home office is about two-and-a-half hours away from ASI's headquarters in Baltimore. "I'm a bit of a technology story myself," she jokes. "I telecommute to our corporate office." When she joined ASI some 10 years ago, she was a sales representative in Virginia. As her family grew, so did her responsibilities with ASI. She and her manager began talking about some of the needs of ASI and how she could fulfill those needs and still be with her family without relocating. "I'm electronically connected to the ASI offices in Baltimore," she reports. About once a week, Christman visits the Baltimore office to stay in touch with her staff and the other ASI staff members.
It stands to reason that a company that leverages technology to support key employees would have an equally keen interest in it for its customers. This commitment to technology is spelled out in ASI's mission statement that reads in part: "...to exceed our customers' expectations (by) leveraging leading technology...." "It's been an ongoing effort for ASI to develop and implement technology solutions that streamline the premium finance process and reduce costs for their customers," Christman explains. "We're trying to automate at every level of the business transaction."
ASI's most recent effort, the Quote Kit, is being marketed by way of joint ventures and strategic alliances with insurers and rating software vendors. "When we work with an insurance company, we become partners in marketing each other's product," Christman notes. "If the carrier is not able to offer a payment option with its premium quotes, agents are forced to find a finance company themselves or the insured has to pay in full up front. And if the insured is comparing one company's quote with another company's, the ready availability of financing terms may be a tie-breaker. It's a value-added to help increase their hit ratio and make them more competitive in the marketplace."
It also can be said that ASI puts its money where its mouth is. ASI provides its Quote Kit and training for free. "The only cost to partners is the minimal investment in getting the software up and running," Christman explains. "The payback comes by way of selling more policies and financing more policies."
Agency Services, Inc., was founded in 1975 and is independently owed. Headquartered in Baltimore, Maryland, ASI has approximately 200 employees and operates in every state. In 1997, ASI financed more than $500 million in P&C insurance premiums through 500 insurance companies and 10,000 independent agencies.
Contact
Jim Schafle, (800) 638-1923, ext., 9123, jims@asionline.com
or Henry Stansbury, (800) 638-1923, ext. 9120, henry@asionline.com
Web site www.asionline.com
Win/win/win
At the agency level, there are no additional hardware requirements to meet. When the Quote Kit is made available with rating software, it's part of something the agency is already using. Add to that the fact that the finance terms appear with no keystrokes, and the benefits are easy to understand. Says Stansbury, "If it's an effort to offer finance terms, then sometimes the customer isn't offered that option. But by having the terms readily available, the agent wins the sale, as does the carrier and the customer doesn't have to pay the entire premium at one time. It's a win/win/win. It's beneficial to the entire process to offer these terms at the point of sale and the key is no keystrokes."
And when it's used at the carrier level, the finance agreement is included with the policy when it's processed. With insurance companies constantly on the lookout for new ways to make it easier for their agents to do business with them, ASI sees the availability of the Quote Kit as providing a marketing advantage to all parties involved.
The same thing is true at renewal time as well, whether the company is mailing out quotes or policies. They automatically go out with the finance form attached.
Jim Schafle says the Quote Kit takes much of the workload off the agent by enabling the carrier, general agent or rating vendor to provide the finance agreement instantaneously at the time the quote or policy is delivered.
Being able to offer financing as a payment option appeals to Mike Wilkerson, manager--general accounting for Markel Insurance Company. "From a business perspective, it's not the interest rate or the payment amount as much as it meets the customer's cash flow needs," he observes. "We want to relieve some of the administrative burden from the agent. Essentially, a couple of signatures completes the transaction."
Generating the finance agreement is built into the workflow at Markel. At this point the Quote Kit is in use in only one of Markel's niche markets, health and fitness, although Markel has been using other ASI products for the past two-and-a-half years. The Quote Kit has enhanced Markel's relationship with ASI, just as it has enhanced Markel's relationship with its customers. "It's something that makes ASI easier to do business with, which is what any business tries to do," Wilkerson notes.
Objects make the difference
And the fact that the Quote Kit is object based enhances the implementation efforts. Markel uses a system they created themselves. "There wasn't a great overhaul of our system. Our programmer met with the ASI programmer for a day or so. Jim Schafle took a vested interest in the implementation--he was very familiar with the product. I don't think you usually find someone at that level in an organization who is so familiar with the details of a product."
The fact that the Quote Kit is free wasn't a real motivator according to Wilkerson. "We already had a relationship with ASI. The features make it appealing. The underwriters and processors who regularly use the Quote Kit appreciate the fact that it reads off our system and fills in the fields that are necessary to produce a finance agreement." It streamlines their workflow and minimizes input errors.
But just generating the contract is only the first step. Once the customer signs the agreement, it's returned to Markel. From there it's sent to ASI for processing by way of electronic imaging. Again, technology streamlines the workflow in that using electronic imaging eliminates keystrokes--and errors. Within about five business days, the funds are electronically deposited into Markel's account by way of ACH. Scanned images of the finance documents are retained by Markel on a Jaz® drive which means they don't need to maintain that information in a paper format.
Bob Meyerson, president of California-based Facilities and Services Corporation (FSC), says his company has had a relationship with ASI for about two years. And although FSC has numerous integrations with other finance companies on the personal lines level, he says ASI is the only finance company that has expressed an interest in integrating on the commercial lines level. In fact, they've built in some incentives for FSC customers to get them started.
As with Markel, the fact that the Quote Kit is free is a secondary consideration for FSC. With so few finance companies taking an interest in commercial lines in FSC's California market, the mere fact that it's there is enough. Meyerson explains that ASI has gone to a number of MGAs and insurance companies in California and used commercial lines as a platform on which to integrate. For FSC the integration was painless. "There is only a small piece of software that's on our side. It activates the bridge so the integration can take place.
"When an agent looks at what FSC has to offer, it's more than just a rating product," Meyerson notes.
ASI's Nancy Christman reports that when ASI contacts FSC's customers to let them know the Quote Kit is now part of their rating package and to offer education and training, the agencies are very pleased. "In the past the agency had to go out and find premium financing companies on its own. So this really affords them something that wasn't there before." *
©COPYRIGHT: The Rough Notes Magazine, 1998