MOVING more and more to direct-bill payments over the past 10 years, our agency had almost eliminated the processing of premium payments. In 2002, however, we acquired another agency and discovered that they had a substantial number of customers who remitted direct-bill payments to the agency office. We saw processing these payments as a nonproductive use of our time that provided no value to the customers.

It had been so long since we had addressed this issue that we had to start from the beginning to design a plan to eliminate the processing. Since we had just purchased the agency and knew there was no chance of having the former owner continue in any management role, we were reluctant to make too many quick operational changes. We ultimately broke the process down into three phases, to be executed over two years.

The first phase was to identify and quantify the volume of direct-bill payments. The second phase was educating customers about why it was in their best interest to pay their premiums directly to the carriers, while we continued to provide additional services. The final phase was designing and implementing a phase-out time-table and establishing a final cutoff date. I will discuss the first phase in this column and the subsequent phases in the next two columns.