Kemper Insurance
About Kemper Insurance Companies
Kemper Insurance Companies, with 2000 revenues of approximately $4 billion, is a leading provider of property/casualty insurance and risk management services. Kemper operates nationwide and in many foreign markets. The Kemper Insurance Companies are "A" rated by A.M. Best, Standard & Poor's and Moody's. For more information about Kemper, visit www.kemperinsurance.com.
Looking for a Solution
Late in 1999, Kemper embarked on the development of a strategic plan to reshape the company with its primary goal being to improve combined ratios and as a result position the company to better compete in the approaching century.

In order to achieve this strategic plan and improve combined ratios, the following goals were established. Develop the ability to rapidly respond to change. Identifying and fix problems with the individual lines of business. Launch and encourage new profitable growth efforts and make bold strategic moves to best position the company to take advantage of changes in the financial services environment.

Fulfilling this broad multi-year strategic plan held the promise of profitability and improved combined ratios, the key measure of performance for an insurance carrier, but it also meant many departments, including premium audit, would need to rethink their core business process.

The premium audit business unit directly affects an insurance carriers profitability and as a consequence, its combined ratio, because it's activities are, in part, responsible for determining the amount premium an insurance carrier will charge its customers. For the premium audit business unit, meeting and advancing the corporate strategic plan meant their core business process would need to improve quality, accuracy and timeliness of the premium audit process by replacing fragmented, ineffective and costly systems with enterprise capable, efficient and technologically advanced systems.
Finding the Answer

Numerous solutions were considered, including internally developed and externally provided vendor systems. Ultimately, the litmus test for determining the best possible premium audit system capable of meeting the corporate mandate and satisfying the needs of the premium audit business unit was the cost benefit analysis. "We evaluated several systems for premium audit and visited trade shows to find the best solution for our application," said Pat Granmaison, a manager in the premium audit business unit. "We needed to significantly lower the maintenance costs [of premium audit] and when we did a cost benefit analysis we were sure PremiumWare would do that." We selected the PremiumWare audit system."

 

After the selection of the PremiumWare system, a detailed implementation and integration plan was assembled using resources from Kemper's technology services, Kemper's premium audit business unit and PremiumWare specialist. Among the many other tasks required implementing the new premium audit system, historical data had to be migrated to the new system, tested for accuracy and affected personnel had to be trained. "The conversion of data was well handled and PremiumWare staff was very helpful competent and responsive during the entire process," said Kemper's Granmaison.
The Long Term
By implementing PremiumWare, Kemper is now taking full advantage of a centralized and easily accessible database that supports other systems contributing to the premium audit process. Business units depending premium audit such as underwriting, collections, loss control and claims can now access audit related policy information real-time. According to Ron Dylong, Kemper's premium audit officer, "the Kemper premium audit system has been well received. The business and applications teams delivered a valuable and efficient communications system with many features that our people need."

Kemper's recent performance is setting new milestones for they have moved from trailing the industry average to outperforming it in the loss and expense ratios and increases in premium income. This is no small feat given the state of the industry in recent years.

Bill Smith, Kemper President and Chief Operating Officer believes technology, like PremiumWare, is an important factor in transforming the industry from a tradition-bound business to one in which rapid, dramatic change is the order of the day. "Winners in the insurance industry will be those that best harness their IT potential and develop streamlined processes for agents, customers and staff," said Smith.

The impact of similar efforts throughout Kemper is reshaping the company and positioning Kemper to respond to coming changes in the financial services industry.

 

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