Leveraging the Web

Rough Notes, May 2001 by Maes, John

Ajasent, Inc., is one of a number of firms that have hit the market recently ready to help agents who want to get out from under technology demands and get back to being an insurance producer.

Ajasent is an application service provider (ASP) which provides the agency with Internet access to application software and provides housing for data files.

According to Mark Parrish, a 25year insurance industry veteran, consultant, and Ajasent founder, this ASP enables the agent to carry out about 90% of all office tasks such as accounting, ACORD forms, contact management and policy changes, interface with carriers, word processing and marketing through the office desktop that is hooked to Ajasent's datacenter. The fact that the programs and data are housed off site would be invisible to CSRs and principals, Parrish explains. "There's no difference in workflow or usage," he says.

Bottom line for the agency? No more need for hired or in-house information technology expertise and no more expensive hardware/software upgrades. The agency won't have to put up the several thousands of dollars of initial capital normally required to get into software and/or hardware. It will realize reduced long-term systems costs, immediate access to new technologies, have 24x7 remote access to data and easier creation and management of branch offices and telecommuters, Parrish says.

"There's little that's really hot and new about what we're doing here," he says. "What's hot and new is that agents are going to be able to get out of the technology business."

The agency that chooses the ASP approach instead of a similar in-house system can save 30% to 50% in technology costs Parrish estimates. "With an inhouse system, even if you automate today, typically you'll still have to upgrade in five years," he says. "At the minimum, you'll have to replace your desktop computers once if not twice during that five years.

"While technology is critical to the insurance agent's survival, it is painfully obvious that most of them are frustrated and not equipped to manage and stay current on technology issues," he continues. "Agents are tired of the merry-goround they've been on the last two decades with automation. They're tired of constantly upgrading their systems, tired of spending money upgrading or connecting branch offices and having to spend more time maintaining their system than they do utilizing it."

Behind the emergence of ASPs is the explosive growth of the Internet, says Parrish. The ease and speed of using the Web has removed significant time and cost from database access. "Before the Internet, you had essentially two options. You either ran your office on an in-house system or you did things manually. And if you had a system, you had to own it."

Agencies with branch offices faced a special burden of having to equip each one with its own remote system, according to Parrish. "If you had a number of branch offices, it could get very expensive to make the remote operations happen. But in the ASP environment, all you need is Internet access. If you have one, five or 10 locations, they're all sharing the same database," he says.

Rhonda Lobell, owner of Lobell/Dixson Agency in Baton Rouge, Louisiana, says using an ASP has enabled her to operate her start-up agency from home as well as the office because "everything's automated." And she didn't have to come up with a lot of money to get automated. Her operation is largely paperless and all files are accessible via the Internet. "I can work from anywhere," she says. "All I need is my laptop and if I can get to an Internet connection, I can access everything I need to know for any client," she says.

Agencies pay a flat monthly service fee on a per-user basis in addition to a small set-up fee. Upfront fees could also be charged if upgrading an Internet connection or converting data for storage is necessary, although the latter fee is typical for any switch to a new vendor, Parrish says of his company's product.

Among the available agency management system software packages which Ajasent hosts are Doris, InStar and Agency Solution. In addition to the agency management software, Ajasent also hosts third-party software that agencies need for rating, MVRs, interface, etc. "In our environment, we can host almost any software product an agency uses," according to Parrish.

Set-up time can range from two days to a month depending on the circumstances, he says. For an agency that is already using one of the software vendors hosted by Ajasent, the data can be transferred and operations can be resumed in as little as 48 hours to a week. There's longer lead time if the agency is using software which must be reformatted and converted before the transfer takes place, he says. The data transfer can be done either over the Internet or using other media such as CDs or backup tapes that are sent to the datacenter.

What about data security issues and the possibility of an agency's data files being "hacked" or implanted with a virus? No system is foolproof, Parrish notes, but the datacenter contracted by Ajasent to house files uses powerful firewalls and security technology.