IF YOUR agency management system has ever crashed, you know the challenges that accompany such an event. Over the years, we've experienced several system failures and have developed some loss-prevention techniques as a result. I'll share them with you in this month's column. We'll also look at some of the serious, often unanticipated consequences of a system failure.

Failures and upgrades: If you are installing a major upgrade to your agency management system, be sure to have at least two good backups. First, you should have a backup that was completed after the previous day's work. (Typically, agency management systems automatically create such a backup each evening.) You also must ensure you have whatever you need to duplicate all transactions made on the day of the installation itself. That means all transactions made before, during and after installation.

If you take these precautions, you'll be protected if your system crashes during the upgrade. You'll also be protected if your upgrade only appears to be successful. If, hours later, you discover a defect that requires you to reinstall the upgrade and restore all transactions completed after the initial installation, you'll be able to do so.

Some agency management systems are set to back themselves up automatically late at night. Such backups in the wee hours have become common in agencies whose employees sometimes use laptops and the Internet to work off premises and into the night. If a system upgrade is installed in such an agency immediately after it closes for the day, the agency could lose the entire day's work if the system crashes during installation.

Failures and “patches”: Between major upgrades, agency management system vendors often send their clients small software “patches” to take care of specific problems. Sometimes agencies wait until they get several patches, then install them all at once. That can create more work, not less. If the last patch malfunctions, you'll have to restore the system, using your latest backup, then re-install all of the patches. Agency management system vendors have gotten much better at creating patches that install right the first time, but installing multiple patches still can be risky. If you're risk averse, stick to installing them one at a time.

An agency that retains paper is on solid ground when it comes to restoring work that was processed, then lost, on the day of installation, assuming the proper paperwork can be identified in something like a transactional-date file. If you give clients written confirmation of policy transactions, you can use those documents to reconstruct telephone requests for changes that were lost in a software installation.

If you are paper-based, you might be able to run a transactional file report to assist in your recovery, assuming the malfunction was not in the report function of your agency management system. In a “paperless” agency, in which documents are scanned then shredded, recovery can be more challenging. One solution is to wait 24 to 48 hours before shredding or discarding scanned paper. (This assumes that the latest regular system backup will be no older than 24 hours.)

There is no escaping the fact that a software installation failure is frustrating for everyone in an agency and drains off a lot of time that could be used for more productive purposes. To retain some perspective, remind yourself of all the productivity you've gained from your agency management system. On the whole, you're still far ahead.

Other technology failures: A software-installation failure is a fairly straightforward event, and one from which recovery, though aggravating, can be relatively routine. Other sorts of technology failures, however, can dramatically affect an agency, leading to the loss of an account or even an E&O claim.

If a failure in an electronic fax program–one that receives faxes and sends back confirmation messages–causes the agency to lose the incoming data, it could leave the agency in a position where it has provided the sender written confirmation of receipt of material that it doesn't actually have. It may not even know who faxed the information to it. When such a failure occurs, an agency must quickly find a trustworthy alternative to the fax program and not put it back on line until it is confident it will work reliably.

Reliability also must be maintained when it comes to other technology. We recently installed a voice over Internet protocol (VoIP) phone system linking two offices. Such a system requires a virtual private network (VPN) for carrying the voice traffic over the Internet connection. Our existing VPN was adequate and dependable for data transmission. It was not, however, for voice traffic. That became evident on the first day we used the VoIP system, when we lost voice-mail messages clients left on it.

Like most agencies, we had a recorded message on our voice-mail system, informing callers that coverage could not be bound nor claims reported without talking to an actual person. Still, we immediately discontinued the use of our voice-mail system and did not restore it until we installed a completely new VPN (a three-week process) and tested it internally and externally for two full days.

Since agencies strive to maintain continuous operations, any of the failures I've discussed can cause one to reassess the risks and rewards of using technology. If you've experienced any of these failures, I'm sure the anxiety and aggravation are still vivid in your memory. They may make you reluctant to embrace new technologies–or even question the worth of what you already have.

If you find yourself in such a frame of mind, remember that the cost of not going forward is far greater than whatever you save in time, expense and aggravation by standing pat. The next time you find yourself right in the middle of that proverbial swamp, remember how on those previous occasions you actually drained it faster than you thought you would and, with the problem recognized and corrected, wound up on more solid footing than before.

Edgar J. Higgins Jr., CPCU, is the owner of Progressive Management Consulting and the Thousand Islands Agency in Clayton, N.Y. Readers may contact him at [email protected].