Six years ago, Pioneer State Mutual went looking for a replacement for its policy management system. The Michigan insurer had reasonable goals in mind; it wanted to add automobile to its list of coverages, and to take care of a little thing called Y2K. The Heritage computer system it was using at the time couldn't handle Pioneer's auto needs and there was no one from the company to turn to for help-Heritage had gone out of business.
Other Heritage users told Gerald Dafoe, Pioneer's director of information systems, that some homemade upgrades were possible to handle auto coverage, but the company was on its own when it came to Y2K compliance. “It would have been difficult to add on to the old system, but possible,” Dafoe said. But after talking to other Heritage users who had made their own customizations, he became even more reluctant. “They told us the product was almost their own,” he said.
That was enough for Dafoe and Pioneer's officers to hear. They went shopping for new software and chose Allenbrook's Phoenix policy processing system. Was it a good decision? “We were about a $29 million company [net written premium] in 1995, and this year we'll hit $60 million,” Dafoe said. “Most of that is due to the automobile program we added.”
While Allenbrook has built a strong reputation over the last six years, Dafoe said that was not the case in 1995. “It was fairly new then,” he said. “This was kind of a leap of faith for us.” (Although Allenbrook had been in business since 1988, it was purchased by AMS Services in 1993.)
Implementing the Allenbrook system was not painless, but Kathleen McClain, Pioneer's assistant director of information services, said the system can now take whatever Pioneer throws at it. The company has more than 80,000 policies on the system in 13 lines of business. “We're one of the few companies with all its lines of business on Phoenix,” Dafoe said. “Most people use multiple systems for their different lines.”
Before Allenbrook, a typical response to requests for changes was: “It's impossible,” Dafoe said. But Allenbrook changed all that.
Phoenix allowed Pioneer to integrate its entire policy processing system, providing policy entry, rating, quoting, billing, issuance of new business and renewals, endorsements, audits, forms issuance, and claims administration.
Allenbrook's constant growth is one advantage of the six-year-old decision is. “It's much more reliable now-and faster,” McClain said. “It's a far more mature product.” A switch to Microsoft SQL Server has increased speed and reliability. While the network system has worked well, McClain is looking forward to the new Web-enabled system that Allenbrook is now offering after its merger with VIC Corporation earlier this year. McClain said Pioneer is in negotiations and hopes to have something up by the end of the year.
Being Web-enabled will likely be an attractive feature for the independent agents who sell Pioneer's products.
“It has been received very well by its users,” McClain said. “The screens have an automatic flow so the user doesn't have to guess where to go.” The Web feature will give a facelift to Phoenix, but McClain said the data will still be available for agents to rate, bind, and issue policies. The ever-expanding database is one element Pioneer has observed closely.
The partnership between the two companies has worn well over six years. “This has been a good arrangement for our company,” said Dafoe. “There has been some pain along with it, but Allenbrook gave us a stable product. It's probably been more luck than good management on our part.”
Predicting the future is always difficult, particularly when your company is looking to grow and is hooking its cart to a relatively untested product. In the case of Pioneer and Allenbrook, it proved to be a good marriage and one that looks to grow stronger as new features are added.
THE COMPANY: PIONEER STATE MUTUAL INSURANCE
NET WRITTEN PREMIUM: $60 MILLION
WEB SITE: www.psmic.com
THE PRODUCT: THE PHOENIX POLICY PROCESSING SYSTEM FROM ALLENBROOK
WEB SITE: www.allenbrook.com
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