The Bottom Line Tip O’ the Month

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The Bottom Line Consulting Group, Inc.

5501 Woodland Drive

Savannah, GA 31406

(912) 356-1516

Ron Webber has been a licensed insurance agent for over 33 years, as an agent, an agency principal, VP of a multi-office insurance agency and has worked with over 250 agencies nationwide as an on - site automation implementation consultant.

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Dear Diary ...
Notes, Notes, Notes - The lifesaver of every Insurance Agency

by Ron Webber

Have you ever noticed when someone is testifying in front of congress, they always open their comments with the following statement, “To the best of my recollection…..?”

That type of statement could cost you thousands of dollars or even the demise of your business. It is just not good enough in our world of insurance. No matter how minor or petty it might seem at the time, you must document every conversation and contact on each policy. If you don’t thoroughly note every contact, you are subject to attack from every conceivable direction about the content of every conversation.

Many agencies have used the inside cover of the manual file folder to note each contact with the insured, the company, the lien-holders, and certificate holders. This method was effective, but not always reliable or readable. How many times have you gone to review the transactions on a manual file, only to find something missing or the handwriting so poor you could not understand the note, even if you wrote it yourself? If you have ever been questioned in a claim review or had to testify in court about a policyholder and stumbled in your attempt to clearly explain everything that has occurred on a policy, you understand this dilemma.

Good notes and diary entries are essential in maintaining the integrity of a file. From the first time a client enters your office and every event that occurs during the policy period, good notes are critical to handling customer files in a professional manner. Good notes will eliminate debate and hard feelings with a customer on changes they “thought” they requested. With good notes a complete history of what actually occurred on a file is easily understood. It is also essential that every note is complete and makes sense.

Notes need to be concise and abbreviations are acceptable provided they are consistently used throughout your office so that everyone understands what your note says. This is especially true in the automated agency on the electronic file. Since most activities are entered into the transactional history of the file in accordance to the sequence of events, the notation of phones calls and office visits is crucial to interpreting the history of the file. A clear, concise note must be entered every time a customer calls, comes into the office, or
any other even that affect his file event occurs.

If your agency management system makes an automatic note, such as an activity that is recorded when an endorsement is done and the description says what you did (“replaced 89 ford/added 99 Chevy/+c/c 500 ded”), then obviously there is no need to add another note that duplicates that entry. If the insured calls back later with a correction for the lien holder, note that phone conversation in the history log.

Here is a note example based on phone conversations: Customer called and asked why he received a cancellation notice, when he had already made the payment. You called the company and they received the payment and they just crossed in the mail. (That is a good note, but a little wordy) Remember our goal is to create good, short, readable notes where possible. Sometimes you must spell it
out, because it is too complicated to use abbreviations or shorthand. If this should happen, spell it out in full so everyone will understand the note. The main point is that everyone uses the same methods of shorthand.

Here are some examples abbreviations or shorthand that you might start with and expand for your own agency. Using a long method you might describe a situation as follows: “Insured called and said lien-holder was wrong on policy, he gave me the new information and wanted me to fax it to the lien-holder and send a
copy to the company, I told him I would.”

A more effective method might be:
“CUPH-Lien wrong, faxed to lien & co.” (Says exactly the same thing) CUPH stands for “customer phoned agency.”

The most common codes might be:
CUPH, OV=office visit (by customer),
APH = Agency made phone call to:,
COPH = Company called agency about:).
Here are some examples of how the codes can be used:
CUPH-to chk on pay sch. (customer called to check on payment schedule)
APH-(Joan@PROG) Pay due 4/5 $87.00 (agent called Joan at Progressive to check on next payment due: she said, “that insured needed to pay $87.00 by 4/5.
APH – Told insd what Joan said
COPH-(mary@AtlCas) Vin on 99 Chevy Wrong. (Mary at Atlanta Casualty called and informed us the vehicle identification number on the 99 Chevrolet was wrong and we need to get the correct number)
APH-Insured to get corr vin (agent called the insured to the get the correct Vehicle identification number)
FAX chg req to Mary@ATLCAS (I faxed the change request for the VIN to Mary at Atlanta Casualty.

This should give you an idea of how good, concise, and understandable notes will help you understand what has occurred on any file. You can see the effectiveness of good understandable notes. Abbreviations should be common sense easy 3 letter codes that everyone understands. Some examples I know you will understand are: New, Ren, Can, Rei, End, D/L, VIN, DRV, MVR, D/P, etc.

No matter which code you use, make sure everyone in the agency is on the same page. Otherwise you will spend too much time trying to understand someone’s abbreviations. The key to good note taking is do it consistently and using a standard code each time you touch a file, if an automatic entry is not created by some
action that occurs on the file. The rewards for are the elimination of
misunderstanding and possible E&O exposures plus greater efficiency… and greater efficiency means more profit.

As important as automation is to your agency, effective use of the automation is key to your continued success and profitability of your agency.

Excited About Automation Yet?
Or do you dread changing your ways?

When you read or talk about insurance agency automation, do you get excited about the future … or is all this talk about change just too scary to face?

When I see an agency getting ready to take the plunge into the world of automation, I get excited. I am excited because of the doors that are about to open for that agency. These doors will lead to good, consistent, standardized practices. These same doors often open opportunity for business growth and expansion while closing the door to potential E & O problems.

Most agencies after opening the door to automation, never look back, or even imagine returning to their old ways and methods of doing business. Some that dreaded changes most are now the ones singing its praise. I will never forget one reluctant East Texas lady that kept telling me she could not do it. She said she was too old and set in her ways to try something new. Today, she will tell you that if her boss stopped using automation, she would quit and go look for an agency that had automation and used it to the fullest. I hear this kind of story over and over again from all over the country.

It isn’t just working with computerized files that is selling these agents on automation. The automated work flow requires tasks be completed more thoroughly, efficiently and consistently and agency owners and managers like that. Many times the old manual methods and standards were such, that if a task wasn’t completed, it got put to the side to completed later. Seeing that a task should be and can be completed immediately and on time, is what is selling agents on automation.

Is automation for everyone? Yes, it is. Will everyone be successful with automation? I will be the first to admit, some do fail. The reasons are many, but mainly due to lack of commitment and conviction to do it once and do it right the first time. Some new users are not committed and are convinced that it will not work for them and with that attitude, they are right.

Over the past 12 years I have talked to hundreds of new automation users and the ones that are excited and have a thirst to learn more about their new software are the agents that not only succeed, but also soar. They soar to new heights of premium volume, retained commissions, and reduced cancellations and
E& O exposure.

It all goes back to the question of being positive or negative on any
subject. The positive and excited person will always exceed the negative and sour attitude about any subject. Change is scary, no matter what part of your life is being affected. Whether it is in your personal life, social or business life, change is life altering. But positive attitudes about change and the desire to make something work will certainly make success more attainable.
You might call me a positivist as compared to a pessimist. Because I have seen the light at the end of the tunnel and I know the wonderful feeling that automation can bring to the average agency. It is a wonderful feeling to know that you are doing a professional job for your clients and companies and know they recognize it. Ask any marketing representative about the difference they feel when they enter a positively charged agency compared to the opposite. When that same representative walks into a negatively stagnant agency, they immediately see, hear and feel the difference. Most of these reps tell me the loss ratios back up their feelings. When people feel good about their jobs, and their work it shows. You can’t hide it and you can’t fake it.

Being excited about automation doesn’t mean you have to jump up and down and preach from the nearest stump. Being excited about automation means having a positive attitude that is not only going to work for your agency, but is going to make the difference in success and failure in the future.

So get excited about automation! If you aren’t using an automation management product today, start investigating them and testing to see which software works best for you. If you are automated and just using it around the edges for a few tasks, look into using more of it and getting your money’s worth out of that investment. Being excited about automation could mean the difference in success or failure
of your agency in the future.

Until next month, keep automating those agencies; I really believe the only way that you are going to survive in the 21st Century is to automate.

Remember, the bottom line is “Automation equals Productivity and Profitability.”

Ron Webber

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