Technology Speeds MONY Transactions.

The insurance industry has long perceived customers in the "Ozzie and Harriet" mode of the 1950s. But as life cycles have become more varied and complex, insurers need to recognize the opportunity to offer new products and services, said Samuel J. Foti, president and chief operating officer at MONY Group Inc., New York.

"In that Ozzie-and-Harriet model, the industry approached the customer as having simplistic needs" -- basically, automobile, homeowners and life insurance, Foti said. "I suggest to you that the old model of insurance is gone."

In MONY's case, technology is playing a vital role in that evolution.

Before the company went public last year, it did an about-face in terms of its technology. In 1994, MONY decided to outsource most of its information-services division to Computer Sciences Corp., having determined that technology wasn't a core function. But in 1996, just two years into a seven-year contract that was reported to be valued at $210 million, MONY decided that its information technology was too valuable to be controlled by another entity.

MONY found that in its transformation into an advisory business, it was losing time with outsourced technology services. "The business operating unit now has partners again, and we are able to move more quickly in terms of strategy," Foti said.

During the outsourcing phase, 15% of MONY's total budget was invested in information technology, with a portion paying for the outsourced staffing and maintenance.

Now that is down to 13%, with the bulk of the money devoted to development and implementation of technology.

"It's very structured and focused now," he said.

Foti said that the company's Internet strategy includes selling its products on InsWeb and Quicken online markets and ultimately will evolve into direct sales via the Internet.

A survey of customers has shown that one-third want to deal with MONY's agents--who number 2,500 nationwide--while two-thirds prefer a direct-sales approach.

"But once they understand our value system, half of those who want to deal directly decide they want to deal with agents instead," Foti said.

"Our profile of the client who buys through the Internet is that he or she has relatively simple needs," Foil said. "We want to cultivate that relationship to the point where their lifestyle is evolving and they actually need an agent" to handle more complex insurance transactions.

MONY Life Insurance Co. is the lead life insurer within MONY, a diversified financial-services holding company with nearly $25 billion in assets under management. Through its operating subsidiaries, MONY focuses on providing financial-protection and asset-accumulation products to upper-income individuals and small-business owners.