Does local outsourcing benefit the retail agency?

[mclureins]

What is your opionion please? I am about to set a new launch date for our product. I am not looking for prospects here I am looking for feeback and opinons as this along with many other ways we write insurance will change in the near future! Technology is focusing tremendously on the insurance industry as we become more competitive. I want to help agents out there become more focused on sales and service and not be burried in accounting problems and non-core business.

CAN THIS WORK IN YOUR AGENCY ?!?!? Please your opinions and comments are tremendously helpful to us! Good or bad we need to hear it! We have invested hundreds of thousands into this concept and we want to know what your ideas are!

Thank you for all of your comments!

Outsourcing Option

Since managing premiums is not an agency “core business”, retailers will be glad to outsource it for a fraction of its
in‐house cost. Immediate benefits include:

 Agency personnel will be able to focus exclusively on sales and service;
 CSRs will have 25% more time to support producers and service or cross‐market;
 Bookkeepers’ work load will be reduced by 70% or more.
 Producers will no longer be involved in chasing delinquent payments or track their commissions;
 Managers will no longer have to monitor daily cash receipts or determine earned commissions that need
to be transferred to the agency’s operating account.

The outsourcing process is similar to the ADP payroll service and is very simple. Agencies provide to administrator
business transaction source documents, such as: policy premium schedule, endorsements, payment checks,
company statements, etc., administrator manages:

 Receivables process until premium payments are received and deposited in the bank;
 Agency commission income;
 Company remittance;
 Return premiums;
 Commission on DB accounts;
 Personal funds maintained in the trust bank account.


NOBLTM Interface with AMS and Other Software Applications
Current AMS users (or other similar software applications) need not discontinue the use of these applications. The
following interface procedure is to be followed:

 Continue to use AMS for sales and service, as usual;
 Create prospect client data records for marketing purposes, as usual;
 Create initial policy coverage and premium data records necessary for submittal to underwriter, future
policy service and renewals;
 Upon changing the client status from “prospect” to “insured”, stop using AMS. Premium payments, bank
deposits, commission transfer and disbursements to carriers will be taken over by the NOBL Service;
 Agencies will provide source documents;, Paulmar will manage premium receipts, bank deposits,
commission transfer and carrier disbursements until all transacted premiums and endorsements are
received and fully disbursed;
 Agency will continue to perform GL accounting as required by CPAs to determine agency tax liabilities;
 Agency will enter in the General Ledger the commission income information provided by Paulmar and will
generate agency Balance Sheets and P&L Statements, as usual;
 Agency will generate trust account financial reports using the Service application installed on the agency
premises.

[mica.cooper]

Outsourcing is valid for two reasons:
1-You don't have the expertise inhouse
2-Its significantly cheaper somewhere else

Seems like you have the expertise, why not train someone(s)? and save the expense, unless..
Number two, your in someplace like NYC, and you can have it done in Arkansas, pay the overhead for outsourcing, and still save 40% or more. I have been involved with outsourcing and most of the time it fails. We have been successfull with very highly skilled personnel in eastern Europe. In these cases, they met both #1 and #2 and it cost less than 10% of US labor cost.

[mclureins]

Outsourcing is valid for two reasons:
1-You don't have the expertise inhouse
2-Its significantly cheaper somewhere else

Seems like you have the expertise, why not train someone(s)? and save the expense, unless..
Number two, your in someplace like NYC, and you can have it done in Arkansas, pay the overhead for outsourcing, and still save 40% or more. I have been involved with outsourcing and most of the time it fails. We have been successfull with very highly skilled personnel in eastern Europe. In these cases, they met both #1 and #2 and it cost less than 10% of US labor cost.

the problem is that most agencies are not benefiting from the current systems the way they should be. Either by information as well as in accuracy. So why not leave the data entry to another company that is less expensive, accurate, and secure? This should allow the agency to focus on production and service. What a true retail operating is.