While some Canadian MGAs are moving along well in implementing electronic feeds, there are still those using older-fashioned methods, including inputting data by hand.“We are currently doing all our business on spreadsheets,” Al Knight, department leader at Edward Jones told the Canadian Life Insurance EDI Standards Association (CLIEDIS) meeting in Toronto in September.

“It’s Excel 2010, it’s a great little tool, but it’s also not very user friendly because you have to rely on someone keying in all the data to the spreadsheet. So basically, right now I have three people sitting at their desks as the applications get faxed in and imaged in and they are keying that into the system. It’s not a very efficient way of doing it and not a good use of their time.”

Knight said Edward Jones spent the better part of the summer trying to build its own internal system, but then decided to contract with a specialized company. Knight said Edward Jones was to go live with the feed just a few days after the CLIEDIS conference.

Moving forward

“So I’m looking forward to great things moving forward and getting more data into the system and change how we are actually doing business.”

CLIEDIS is the industry association that promotes using electronic data between various key members of the life insurance industry, including advisors, MGAs and life insurance carriers.

The first step for many stakeholders in the industry is to ensure there are “pending data feeds” – electronic transmission of data meant for insurance applications being sent in for approval.

Most of the insurance carriers have already brought in these standardized feeds across the industry. The next step is to set up feeds that also provide standardized data across “in-force” feeds for policies that have already been written up and approved.

The next step

Tracey Cambridge, president of Global Pacific Financial Services, said her Vancouver-based MGA has had pending feeds for a number of years. Cambridge said Global Pacific also used to use Excel spreadsheets to input the name of the client and date of birth. Now, with the integration of pending feeds, the MGA is able to see data from all carriers on one system.

“I know there is work to be done, but it’s actually resolving a lot of the communications between advisors, distributors and the carriers and eliminating all the redundancies. It has obviously simplified our world...”

Michael Williams, president of CAILBA and also president of BridgeForce Financial Group, said some of the larger carriers, like Canada Life, Manulife Financial, Empire Life, RBC Insurance and Transamerica Life, have led the way in terms of bringing in electronic applications.

But he asked companies to fit in a missing and crucial piece of electronic applications – implementing feeds back to the MGAs.

Williams gave the real example of a recent transaction in which the broker sent in an insurance application and three days later was paid a commission of $8,319.24. The policy, however, wasn’t received into the MGA until almost a week after the original application. Ten days after the original application was sent in, the MGA received an NSF letter from the insurance carrier.

“So the commission has been paid, the policy had been issued, [then came the] NSF cheque and a chargeback of $8,319.24. That’s what happens when an MGA is blind,” said Williams. “We must have a feed back to our companies. It’s imperative.”

We really want to remove the dependency on manual processes because now we want case managers to manage cases and not have…three people keying into spreadsheets.

– Tana Sabatino

Tana Sabatino, Implementation Services Specialist with CLIEDIS, said one of her top priorities for the coming year includes providing an electronic notification to MGAs – to halt any of the kinds of problems Williams cited.

As well, she said she is working on improving standardized pending feeds to remove any errors and ensure the feeds provide usable data consistently and reliably. After that, will come standardized feeds for in-force insurance.

Sabatino said the end goal is to maximize automation. “It’s really hard to change the case management process when you have a piecemeal environment – when the case manager says: ‘I’m going to go to the website because I know that information is right.’ This is what we are trying to get past.

“We really want to remove the dependency on manual processes because now we want case managers to manage cases and not have…three people keying into spreadsheets. We want to remove those dependencies and better realize the resources.”

She said it’s easy enough for some industry members to tell others to dismiss the electronic application process and reconcile it later. But with some MGAs dealing with 20,000-50,000 applications a year, that manual reconciliation can turn into a nightmare. “In order to support our advisors, we need to have this information up front,” said Sabatino.

Personal identifier

Clarke said it’s great that CLIEDIS has a priority of getting in-force feeds. “But unless I can match that up to my clients so I can put it into my CRM system, I’m still a long way away,” she told the meeting. “With 50,000 apps a year [coming into Investors Group] we have tried looking up those numbers and we end up getting 20 John Smiths – so it’s a big problem. What we would like the carriers to do is to acknowledge that and put some kind of number on their applications so they can feed it back to us and we can seamlessly match up that data.”

Eric Wachtel, chief compliance officer with IDC Worldsource, said having in-force feeds “is nothing short of mission critical” and must be secure and provide privacy for clients.