In the palm of your hand: mobile wireless technologies are helping agents and adjusters to be more efficient and also meet the demands for real-time service.

Sometimes the best things really do come in small packages. At least that's what some insurers are finding when it comes to technology. A growing number of carriers now are using mobile and wireless handheld devices to manage daily tasks. From cell phones and global-positioning systems to BlackBerry devices and personal digital assistants, mobile technologies not only are creating a real-time service to help companies increase efficiencies, but also are strengthening customer satisfaction and reducing costs.

A Mobile Era

The concept is a relatively simple one: Anywhere you can gain a cell phone connection, you can do what you need to do, said R. Alan Hedrick, co-owner of County Wide Insurance and RE Agency Inc. "Wireless technology is just like being in the office, but you're able to conduct business from nearly anywhere."

That's proven beneficial for County Wide Insurance's operations over the past three years. Today, its producers rely on PDAs, handheld phones and laptops. "We can't have every toy in the box, but we try to Find the ones that allow us to gain efficiency in what we're doing," said Hedrick.

Property/casualty insurers are among the biggest users of wireless technology. The handhelds are increasingly enriching both the claims process and site inspections, such as for equipment inspections and field safety inspections for workers' compensation policyholders, said Chad Hersh, senior analyst in Celent's insurance practice and author of Celent's Wireless Technology for P/C Carriers: Ready for Prime Time? study.

"Wireless technology allows the claims process to get started more efficiently, and tasks, such as sending photos in conjunction with claims files to ensure greater accuracy, can be accomplished," Hersh said. Mobile solutions are also a natural for claims adjusting, given the need for improved turnaround time, better digitization of data, improved consistency and better customer service, he said.

But it's more than just streamlining the claims process; a growing number of P/C producers also are relying on wireless solutions to access and send e-mails from the field, while some life/health producers are using wireless technology to assist with online quoting and application submission.

The upsurge in recent catastrophic events has given P/C insurers yet another reason to turn to wireless technology. During and after events such as Hurricane Katrina, in which land lines, cell phone coverage and Internet connectivity were virtually all knocked out, mobile devices were essential in opening up the lines of communication. "Some pre-WiMAX solutions and towers were set up for Internet connectivity around the area, allowing insurers and others to conduct business via the Internet and voiceover-IP phone calls," Hersh said. He expects more companies will soon aggregate cell phone signals and turn them into satellite calls--similar to how connections are made on cruise ships. "For catastrophes, self-powered vehicles equipped for that are ideal for staying connected with the home office and getting claims processed in real time," Hersh added. WiMAX, according to the WiMAX Forum, is a standards-based technology enabling the delivery of last mile wireless broadband access as an alternative to cable and DSL.

While P/C carriers are increasingly relying on mobile solutions, the potential for wireless technology in the life/health insurance industries is somewhat more limited, said Hersh. "Their options are more interesting for the longer haul in terms of what WiMAX will do for them, but these industries are more about sales force automation than back-office claims. Producers tend to be more focused on things like customer data and visiting clients in their homes or in the office and doing more complicated things with wireless technologies, meaning adoption will occur more slowly."

Cell Phones and Laptops

Cell phones have developed into a full-feature service device. Not only do cell phones now take photos and contain games, but they also allow users to connect to the Internet, send and receive e-mail, and keep track of appointments. IDC, a global provider of market intelligence and advisory services for the information technology and telecommunications industries, said that it expected by the end of 2005, the world's cell phone subscribers would total more than 1.7 billion.

Although some adjusters and agents are using cell phones to send photos for claims Filed from the field, others fear that might be a bit premature. "The resolution is getting closer, but it's still not high enough," said Jim Daues, vice president of property claims for Farmers Insurance.

Laptops remain another product of choice among insurers, said Daues. "There aren't any other devices capable yet of manipulating the amount of information we deal with in an easy-to-use format." And, he said, laptops can house needed tools, such as estimating software, and their screens are larger than most other mobile devices, which allows claim representatives to more easily share data with insureds on site.

A Technological Frontier

While, in 2004, less than 5% of property/casualty carriers had wireless implementations in place--most of which were focused on the claims process--according to Celent, that's expected to change.

In fact, Hersh expects adoption of wireless technology among P/C carriers to increase tenfold in the next few years. Life/health carriers will have slightly less growth, with adoption rates expected to reach 30% by 2007, he added.

But several roadblocks continue to impede widespread adoption. Upfront implementation costs and a lack of perceived need for the technology continue to plague some companies, Hersh said. "While we could say carriers may not need a wireless solution today, P/C carriers without a wireless claims solution will be at a competitive disadvantage within two years."

The evolution of new technologies also may prove challenging for some carriers. "Technology is always changing and there's always the introduction of the newest, latest and greatest tools out there," said Farmers' Danes. "So the challenge is whether it makes sense to adopt or upgrade at this time or wait until the next generation of a technology is released."

Security concerns also may slow down more widespread adoption. "We want to push technology farther out and move information more quickly. But we'll likely get to a point where security concerns will tighten up things," said Joe Marcum, director of field services for Indiana Farm Bureau, "and even though we may be wireless, we may have difficulty in reaching the next step."

* A growing number of carriers are using global-positioning systems, personal digital assistants and other wireless devices to handle daily tasks.

* Wireless technologies played a big role in opening up the lines of communication during the 2005 hurricane season.

* Adoption of wireless technology among property/casualty carriers is expected to increase tenfold in the next few years, according to Celent. Adoption rates among life/health writers is predicted to reach 30% by 2007.

In the beginning

Mobile technologies have become a mainstay in today's society, and insurance is no exception. The origins of these handy tools are as varied as their uses.

BlackBerry

The device is provided by Research In Motion through cellular telephone companies, and it first focused on e-mail. The idea for the name originated after one of the naming experts at Lexicon Branding Inc. thought the miniature buttons on RIM's product looked like the tiny seeds in a strawberry. In January, the Supreme Court refused to hear an appeal from RIM in a long-running battle over patents for the BlackBerry. Justices were asked to decide whether RIM can be held liable for patent infringement when its main relay station for e-mail and data transmission is located outside U.S. borders in Waterloo, Ontario.

Cell Phone

Cell phones have come a long way since their basic concept was developed in 1947. At that time, researchers studying a crude mobile car phone realized that the small cells (range of service area) with frequent reuse could increase the traffic capacity of mobile phones substantially. It took cell phone service more than 35 years to become commercially available in the United States.

Digital Camera

The cameras evolved from the same technology that recorded television images. In 1951, the first videotape recorder captured live images from television cameras by converting the information into electrical impulses and saving the information onto magnetic tape. In 1972, Texas Instruments patented a filmless electronic camera, and in 1981 Sony released the Sony Mavica electronic still camera that was the first commercial electronic camera. In 1986, Kodak invented the world's first megapixel sensor that was capable of recording 1.4 million pixels that could produce a 5xT-inch digital photo-quality print. Five years later, Kodak released the first professional digital camera system aimed at photo journalists.

Global Positioning System 

The system was invented by the U.S. Department of Defense and Dr. Ivan Getting. However, the launch of the Sputnik satellite by the Soviet Union in 1957 initiated the concept for GPS. Eighteen satellites and their ground stations formed the original GPS. The system uses satellites as reference points to calculate geographical positions. The U.S. military developed a system called NAVSTAR in the early 1970s, and the first products for civilian consumers appeared in the mid-1980s. In 1995, the system was fully deployed and reached full operational capability.

Laptop Computer

In 1981, the laptop computer was invented by Adam Osborne. It was called the "Osborne 1," cost $1,795 and came with a five-inch screen, modem port, two 5-1/4 floppy drives, a large collection of bundled software programs and a battery pack.

Personal Digital Assistant

The term "personal digital assistant" was coined in 1992 by John Sculley in reference to the Apple Newton from Apple Computer Inc. The device gained popularity in 1996 when Palm Inc. delivered what some called the first truly compelling handheld computer, the PalmPilot.

SmartPhone

In 1993, IBM developed the first smartphone, known as "Simon." Since then, smartphones have evolved into basically very small computers, comparable to the power of a desktop or laptop computer. The first Palm OS-powered smartphone, the QUALCOMM pdQ, debuted in 1999 and combined a Code-Division Multiple Access digital phone with a Palm organizer.

Tablet PC 

The first pen tablet--the GBiDPAD from GRiD Systems--was invented by Jeff Hawkins, the founder of Palm and Handspring. In 1999, Microsoft started development of the Microsoft Tablet PC. In 2001, the Beta-1 Version of the Tablet PC operating system and the related Software Development Kit were released.

Sources: about.com, PC Today, Wall Street Journal

Technology to the Rescue

Some mobile technologies have become an essential part of the mix for claims processing and appraisal in the aftermath of catastrophic events.

In the wake of Hurricane Katrina, Bloomington, III.-based State Farm set up 32 mobile satellites to create temporary service and command centers for its claims adjusters in many of the hardest hit areas along the Gulf Coast.

Adjusters were able to process homeowners and automobile claims and expense advances for homeowners policyholders.

Adjusters were equipped with laptops preloaded with claim-handling systems, and the company deployed nearly 5,000 wireless LAN cards to allow wireless communications over cellular towers to connect anywhere in the coverage areas.

American National's PDA Story

A growing number of insurance field forces are being armed with personal digital assistants. The devices allow agents and adjusters to access and send e-mails, schedule appointments and store notes. PDAs have become a windfall for American National Insurance Co.'s agents. In May 2005, the Galveston, Texas-based company rolled out its MobileAgent PDAs and Centralized Accounting System for Home Service in which agents can collect premiums from policyholders of its Home Services products. The applications link more than 1,500 PDAs to a centralized system in the corporate office.

"Previously, it was a manual, laborious process in which agents carried hardback agency books to each home to collect premiums. They then had to go to the district office to return collected monies," said Ken Juneau, assistant vice president and director of distributed applications system development. Mobile Agent, a collection device system that runs on a Dell Axium-5 PDA, now allows agents to pull up accounts, enter collections and generate customer receipts via a small thermal printer that agents carry with them. The PDA is then docked at the district office and establishes a Web service connection back to the home office computer system for all premium collections an agent has made since the last time the device was synched up, he said. In addition it updates policy pay-todates, new business and policy changes.

Mobile Technology's Value

Improves customer service--Allows claims to be handled faster and more efficiently. "From a customer service perspective, mobile technology allows us to complete as much of a transaction as possible, and for adjusters, they're able to gain efficiency by saving drive time," said Jim Daues, vice president of property claims for Farmers Insurance.

Reduces errors--American National Insurance's Mobile Agent's electronic means of collecting premiums has not only eliminated errors, often caused by illegible handwriting, but also reduced duplicate data entry.

Portability--Wireless technology allows agents and adjusters to break away from the confines of local systems. The functionality allows County Wide Insurance's agents, through a cell phone and laptop, to do whatever they need to do, as if they were in their offices, said R. Alan Hedrick, co-owner of County Wide Insurance and RE Agency Inc.

Doing Business The Smart Way

Peel and Holland Financial Group, based in Benton, Ky., is reaping the benefits of a relatively recent handheld device--the smartphone.

The company's account executives use the PalmTre0650 smartphone, which combines a mobile phone, complete with a QWERTY keyboard, with e-mail, an organizer, messaging, Web access and a camera.

"This allows account executives the ability to be out of the office as much as possible but still have communication vehicles, and it frees up more time to service customers and respond immediately to their needs," said Keith Riley, executive vice president of marketing. The wireless device also is ideal for taking and storing notes. "After meeting with a client, an account executive can sit in the car, record notes and e-mail information off to an account manager or underwriter while the account executive still has the information fresh in his or his mind," he said.

On The Go With GPS

Several insurance carriers, such as Farmers Insurance, are equipping agents and claim representatives with global-positioning system devices, which use worldwide radio-navigation systems formed from a constellation of 24 satellites and their ground stations.

"Rather than wasting time looking for street addresses, information can be inputted ahead of time, and there's a safety factor in that adjusters don't have to strain to look at signs and address numbers, allowing them to focus more on the road," said Jim Daues, vice president of property claims for Farmers.

Wifi's Advantages

Challenges aren't stopping some companies from looking to expand existing technologies. Ken Juneau, assistant vice president and director of distributed applications system development for American National Insurance Co., said he's currently investigating new wireless WiFi connectivity to Ken Juneau replace the company's PDAs. WiFi, or wireless fidelity, allows users to connect to the Internet from virtually anywhere at speeds of up to 54 Mbps. "Because the devices turn over relatively quickly, becoming obsolete 12 to 18 months after they're first released, we're already looking at potential replacements," Juneau said. One choice: BlueTooth 802.1 lb wireless-enabled devices coupled with cell phone technology, he said.

And it's the unknown things to come that may have some of the most exciting potential for some carriers. "One thing we tend to forget is that we have ideas of what companies will do with these technologies, but it's all the things we can't even begin to imagine they'll be able to do with it that's exciting," said Celent's senior analyst in insurance practice, Chad Hersh. He said wireless protocols such as 3G--third generation wireless that's digital and includes features such as high-speed transmission, global roaming and advanced multimedia access--will gain traction among carriers in the next several months, in addition to WiMAX, which will gain traction in the coming years. WiMAX offers a greater range and is more bandwidth-efficient than WiFi.

Keeping In Touch

Indiana Farm Bureau Insurance has seen few limitations when it comes to wireless technology. The company implemented wireless touch-screens for its 44 material damage auto appraisers.

The low-cost technology solution leverages the company's 130 satellite offices within Indiana through use of a small pen-based device that is fully ruggedized (resistant to vibration, dust, water, temperature and repeated drops onto hard surfaces) and a semi-ruggedized laptop. The devices connect via 802.11b to a laptop that can remain in an appraiser's vehicle. The devices display the ADP claims software that's running on the laptops, allowing the appraiser to carry the device while in the field, said Joe Marcum, director of field services. 802.11b is an extension of 802.11 that applies to wireless LANS and provides 11 Mbps transmission in the 2.4 GHz band.

"And since it's fully ruggedized, it can be out in any weather condition, and appraisers don't need to carry around pens and paper because it's all done via a touch screen," said Marcum. "It allows us to have lesser-priced laptops in the vehicles because they're not getting beaten up as much, and it's much lighter for the appraiser to physically carry around." In addition, it's also improving the bottom line. "While there was an increased cost to lease the configuration, appraisers now can do more work, and the staff is more efficient to handle future growth because of the increased service."

Learn More

American National Insurance Co. A.M. Best Company # 06087 Distribution: Affiliated companies, agents, brokers, Web-based systems

Farmers Insurance Group A.M. Best Company # 00032 Distribution: Exclusive agents, independent agents

Indiana Farm Bureau Insurance A.M. Best Company # 70368 Distribution: Exclusive agents

State Farm Group A.M. Best Company # 00088 Distribution: Exclusive agents

For ratings and other financial strength information about these companies, visit www.ambest.com.